Wherever you live in the country, the occasional natural phenomena probably serve as good reminders of Mother Nature’s uncontrollable force. Thankfully, having the right insurance can go a long way toward restoring your peace of mind as well as all your stuff.
In honor of National Preparedness Month, here are a few tips for disaster-proofing your insurance.
Review your insurance policies
Whether you live in Tornado Alley or earthquake country, it’s always smart to make sure you’re properly insured.
If you live in an area prone to flooding, windstorms, or other natural disasters, it’s wise to carry both comprehensive coverage and liability coverage on your car insurance policy. If your car’s damaged by a flood, fire, earthquake, or other natural disaster, liability won’t pay for any of the damages — but comprehensive will!
You might also want to add rental car reimbursement coverage, which will help with the cost of a rental vehicle should your car be inoperable for awhile.
Home and renters insurance
Keep in mind that most home and renters insurance policies don’t cover earthquakes or floods. Consider adding flood insurance (obtainable through The National Flood Insurance Program) and earthquake insurance if you live in a high-risk locale.
Additionally, when reviewing your home insurance or renters insurance, check to see whether your policy includes actual cash value (ACV) or replacement cost coverage. ACV coverage will help you repair damage to your home and replace your damaged belongings, minus depreciation. Replacement cost coverage, on the other hand, will restore your home and your belongings without taking depreciation into account. Needless to say, the difference in coverage could translate into thousands if you have to file a claim.
Though most insurers make it easy to access your account online, in the event of a natural disaster, Internet connections are often spotty at best. Be prepared by keeping a hard copy of your policy ID number and your insurer’s phone number should you need to contact them to file a claim.
It’s also smart to keep a physical copy of your declarations page — generally the first page of your insurance contract, which details the specifics of your policy — stored in a secure, off-premises location.
Having a complete inventory of your belongings will make the claims process a lot easier if you ever have to file a home or renters insurance claim. Be sure to update your inventory annually and to keep your list in a safe place, preferably away from home.
Make sure you’re not under- or overinsured
It can be tempting to buy only bare-bones coverage to save on monthly premiums. But minimal coverage also means minimal protection. In many cases, increasing your limits will only cost a few dollars more, and will provide the coverage you need should a disaster (or accident) occur.
That said, you don’t want buy more protection than you need either. To determine the right level of coverage for you, speak with your insurer (or use our online Coverage Counselor®).