Do You Have Enough Insurance?

Unfortunately far too many homeowners insurance policy holders are not carrying enough coverage in the event of a major problem. Surveys which are carried out on a regular basis vary in their view of the extent of the problem but the majority agree that between 60 and 70 percent of all homes are under-insured and that, on the average, these properties are under-insured by about 20 percent.

In most cases of course you do not find that you have inadequate cover until disaster strikes by which time it is too late. In states such as California, in which wildfires are commonly seen, many folks were amazed following the latest outbreak of fires to learn that when it came time to rebuild there was insufficient money available to replace their homes.

The problem does not only concern the amount which you are insured for but also involves the kind of coverage you have. You might be surprised to discover, for instance, that a lot of the victims of Katrina said that they had been informed by their insurance agents that they did not need to be covered for flooding.

So why are a lot of homeowners under-insured? After all, surely it should be in the interest of insurance agents, who are the experts in this particular field, to make certain that their clients are properly covered, not only to protect their own reputations but also because they are often paid a portion of the premiums for every policy sold.

Regrettably, the answer is simple. All too many insurance agents are working on volume and so they do not take the time to ensure you have the best policy but merely sell you whichever plan they can as fast as possible and then move on to the next customer. Additionally, the market these days is highly competitive and so many agents would rather persuade you to purchase a policy at a lower premium and with lower cover than you require than risk you purchasing from somebody else.

As with many things in life you receive exactly what you pay for when it comes to home insurance. Naturally, you can reduce your costs by having a low sum assured and by excluding particular forms of cover from your plan but is it really wise to do so?

For almost all of us our homes are the single most expensive purchase we will ever make and our lives, along with the lives of our family, can quite literally be turned upside down if we are unable to replace our home if disaster strikes. And, if you think this could not possible happen to you and your family, just think back to the many awful stories that you have heard recently from the victims of Katrina and the folks who lost their homes in the California wildfires.