The new year is a time to reflect on the previous year and plan for the year ahead. As we begin anew, we should give thought to policies, agreements or plans we have in place that may need revisiting due to life changes. Most of us have multiple insurance policies – life, health, home, auto, etc. – and these should be reviewed annually.
Now is an ideal time to check in on our policies and make sure nothing new has come to fruition that may warrant a policy change or update.
Below are a few reasons to reevaluate the various insurance policies you may have:
Auto – Auto insurance is required in 49 states, only New Hampshire doesn’t mandate car insurance, so it’s important to periodically evaluate your policy to see if any changes need to be made. There are a variety of things that can impact your auto insurance policy including marriage, purchasing a home, new car, having a baby, retirement or even a new job. Are you working from home now vs. driving to an office each day? This can impact your auto insurance since you may be driving less. Have you started driving for work or for ride-share or food delivery service? This can impact your coverage. Some professions also qualify for discounts and maybe you want to consider bundling auto with homeowner’s insurance. There are quite a few instances where life changes may require updating your auto insurance.
Homeowner’s/renter’s – Homeowner’s or renter’s insurance can also fluctuate depending on various life circumstances. For example, if you get married, you’ll want to revisit your homeowner’s or renter’s policy. The more items you own, them more insurance you’ll need so multiple people under one roof means more stuff. Did you get a new piece of expensive jewelry for the holidays? Don’t forget to add it to your homeowner or renter’s insurance. If you bought a new home or renovated your current one, you’ll definitely want to update your policy. Anything that adds value to your home means changes to your policy. Did you add safety features such as a gas detector, smoke alarm, home alarm, etc.? This could mean a discount on your policy.
Health – Things that impact your health insurance coverage are of course a new job or loss of a job, marriage or divorce, if you are pregnant or had a baby or perhaps you are expecting a surgery or health concern for you or a family member or you moved to another state. These are all life events that can affect your health insurance. Also, plans change so even if you’ve had your plan for a few years and you haven’t had any life changes, you should still review it to make sure your coverage will remain the same and your providers are still covered by your plan.
Life – Life insurance policies are based on your annual income, so if you got a promotion, demotion, raise or pay cut, it’s important to update your policy. Additionally, your policy should align with your retirement date, so if that’s changed, you’ll want to update your policy accordingly. Your health can also affect your life insurance. If you’ve lost weight, stopped smoking or have significant changes to other health related issues such as high cholesterol, it may also warrant a policy update. If you’ve had children since previously reviewing your policy, you’ll need to add them as beneficiaries. Life insurance covers financial obligations, so if you’ve paid off your mortgage, bought a new home or second home, then your policy may need to be updated. Or maybe you just want to shop for a better rate. These are all reasons to reevaluate your current life insurance plan.
Evaluating your policies annually cannot only often save you money but it is a good reminder to make sure your coverage aligns with your current needs. It’s very important to check all your policies each year. Here’s to a healthy and fruitful 2023!
Kelton Busby is a senior member at The Cavanagh Law Firm licensed to practice in Arizona and Utah. His practice includes defending trucking and transportation companies, recreational vehicle manufacturing companies and auto makers in wrongful death and catastrophic actions.