Greetings! This month we want to focus on something that often gets overlooked: property and casualty insurance. Property and casualty insurance covers your home, auto, and umbrella (excess liability) policies. Basically, it is a) the physical items in your life and b) your liability exposure. While it is not one of the most exciting subjects (as our first video will point out), it is incredibly important. Second only to estate planning documents, it is one of the most overlooked pieces of a client’s financial portfolio. As a result, we have adjusted more than 75% of our client’s property and casualty policies. So, what is the most common issue? Insufficient insurance protection in your home or auto policy. To be underinsured is a HUGE risk! Do yourself a favor – go through the links below and consider your individual/family situation.
- Watch: The first is a quick and basic video just to get your feet wet. It goes over some common terminology and concepts. If you feel comfortable with insurance in general, feel free to give it a pass and check out our second video featuring The Money Guy Show. This gets further into depth and they provide great tips, such as videotaping your home for a visual inventory in case of a loss. It’s an easy watch without a lot of fluff or a sales pitch.
- Read: Our reading this month comes from the Insurance Information Institute. While it is difficult in this realm to find impartial information – most articles or content available online are from said companies hoping to sell more policies – an essential piece to take away from the article is the correct amount of homeowner’s insurance to have (i.e. the actual cost of rebuilding the home; this is not the same as the real estate value, and does not include the land value).
- Listen: Our final link covers another critical and often overlooked policy, the umbrella policy. Most clients assume that their current auto and home policies are sufficient, but they are usually not. This is especially true for clients with more considerable net worth, businesses, or assets like a rental property. If you are in an accident or cause injury or damages in excess of your homeowners or auto policies, an umbrella policy will step in to pay over the difference. This policy can be the difference between a bad day versus a devastating event.
As financial planners, it is our job to assist our clients in making good decisions. Unfortunately, when it comes to insurance coverage, it can sometimes be a struggle to fully convey the importance of something that often feels like a sunk cost at the end of the day. As stewards of your life savings and your family’s well-being, we cannot stress the value of appropriate insurance coverage enough. If you have any concerns about your current coverage, please reach out, and we will be happy to review your policies. It is always better to be safe than sorry!
We hope you’ve found value in this reading. Please feel free to reach out with questions and comments. Also, feel free to share this newsletter with your friends and loved ones!Make it a great month!
The Bona Fide Family