“Paper or plastic, sir?” … “Yes …”
This resembles conversations we have with clients in evaluating their property and liability insurance coverage. They know they have it, but that is about it.
Though we do not sell home or auto insurance, our financial planning process involves helping clients address their unique financial risks. And one often overlooked is sufficient property insurance coverage.
The day Hurricane Sandy made landfall, Les Christie published an article on CNN Money’s website about the perils of “hurricane deductible” provisions in homeowner insurance policies. (See the article here at http://money.cnn.com/2012/10/29/pf/insurance/hurricane-deductible/index.html?iid=SF_PF_Lead.)
Now we may not have beachfront homes in East Tennessee, but we do have hail storms and other natural disasters that can severely damage your home and other property. And after these events, you have doubtless encountered complaints about what insurance will and will not cover in repairing this damage. Unfortunately, much of what is disputed is clearly spelled out in the policies that homeowners have failed to properly understand.
So more than simply having insurance coverage on your home and property, you should understand what it covers and how it works. To help you better understand home insurance, the National Association of Insurance Commissioners provides a free guide, which can be accessed at http://www.naic.org/documents/consumer_guide_home.pdf.