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A new national survey reveals that many families do not have enough insurance
protection, or may even have too much or redundant coverage that is needlessly
costing them money.
 In
exploring a variety of home ñ or work ñ related events that may have occurred
in families during the past three years, the survey provides insight into the
haphazard shopping behavior of insurance consumers, who sometimes over-insure
for specific events and often ignore or overlook major gaps in coverage. The
findings illustrate the importance of an annual policy checkup and the New Year
is an excellent opportunity for a review.
Among those homeowners who said they "significantly remodeled their
homes" since 2003 - including a structural change such as adding a room,
porch or deck - nearly 40 percent had not updated their homeowners insurance (or
weren't sure if they had done so) to reflect the new value of their homes. This
equates to almost 8 million American households that may be inadequately
insured.
And, of those owning a valuable collection, such as wine, fine art, jewelry
or antiques, nearly half (47 percent) said they didn't own special insurance
coverage for the collectibles.
More than 4 of 10 families who said they had a young driver move away from
home hadn't updated their family's auto insurance coverage to reflect that
change. Of those who are frequent carpool drivers to a job, school or activities
with children, an alarming 85 percent hadn't changed their liability insurance
coverage to reflect the increased risk of additional passengers in the
automobile.
And a third of those families with a new baby, or 5 million households,
hadn't updated their life insurance protection. Some 30 percent experienced a
significant change in their salary, but 68.5 percent of these had not updated
their life insurance either.
 Insurance
isn't foremost in the mind of most consumers as they go through these changes in
work and in life, but an annual review typically would uncover some coverage
deficiencies. The survey found that fewer than 60 percent had performed a
"comprehensive review" of all their insurance coverage in the last two
years, with half of those saying they haven't done a review since 2002, and an
equal percentage saying they've never done a review. (Another 10 percent
couldn't recall.) That means almost half of all respondents may have outdated
policies.
Reviewing insurance is an important activity for families - and it doesn't
always mean buying more coverage. The review does help you be a smart consumer
and truly understand what coverages you have, what you don't have, and the
reasons why. It sometimes means combining coverages to get the best deal. It may
mean examining deductibles to understand what you can afford, and saving money
on premiums in the long run.
The survey also demonstrates a lack of understanding about property and
liability risks faced by renters. Of families who rent, nearly 7 of 10 said they
don't have renters insurance, and another five percent weren't sure. Landlords
typically insure building structures, but not the contents or liability of
individual tenants.
The survey also reveals the extent to which consumers will purchase
individual policies for specific risks, even though those specific risks
typically are covered by a more affordable homeowners or health insurance
policy. Nearly 14 percent said they bought coverage for eyeglasses, and another
6 percent specifically are covering cancer. Flight insurance was purchased by
more than 7 percent of respondents, and baggage insurance, 4 percent.
Now is an excellent time to contact your BWD Personal Lines Account Executive
and/or Life Insurance representative for a review of your current circumstances. |
