Military Officer - October 2008 - (Page 48) financialforum P&C Coverage Shop for and update your property and casualty (P&C) insurance to ensure your coverage is adequate and fair. Phil Dyer, CFP, provides some tips for you to consider. W The True Cost to Replace Your Home I Web sites such as www.zillow.com can help you determine the market value of your home so you can ensure you’re getting enough coverage. ith home prices in turmoil in many areas of the country, a number of insurers are changing their policies on what cases they are willing to underwrite, their claims policies, and replacement costs for homes with skyrocketing prices. Because of this, it might be time to update your property and casualty coverage; you could be paying too much for the coverage you have, not have adequate replacement coverage, or be missing specific endorsements or riders that are needed to cover expensive items. Consider the following tips. Shop around: Costs for the same coverage can vary from company to company in the same geographic area, depending on claims history, underwriting guidelines, financial strength of the issuing company, and other factors. If you have not shopped for your auto, home, and other property insurance in the past three years, consider doing so. If you have been a good customer, let your current insurance company know you are shopping for coverage and give them the opportunity to keep your business. You often will receive additional discount offers if you let them know you might move to another company. When shopping, get quotes in writing so you can compare them side-by-side. Make sure you have enough coverage: agent to make sure you are not getting shortchanged on coverage and that you will be fully covered in case of a total loss to fire or other covered peril. Many people rely on assessed tax value to determine how much coverage to carry, but this can be a mistake, because their assessed tax value might lag significantly (in rising markets) or significantly overstate (in declining markets) the true cost to replace a home. The same holds true for auto insurance. The standard property coverage of $25,000-$50,000 required in many states might be inadequate if you own an expensive vehicle. The cost to replace two late-model luxury cars easily could exceed $100,000, and a gap in coverage could leave you personally liable for the difference. Cover your valuables: If you have electronics, jewelry, or collectibles, typical home insurance covers very little — usually only $1,000-$2,500. Make sure you discuss buying a personal articles rider to ensure you have adequate coverage in case of theft or loss. Consider wall safes or secure cabinets to further protect valuables, and you could be eligible for a discount on coverage. Your insurance agent likely has additional tips, so don’t be afraid to ask! MO — Former Army Capt. Phil Dyer, CFP®, is deputy director, Benefits Information and Financial Education. To find a financial planner near you, contact Garrett Planning Network at (866) MOAA-GPN (662-2476) or www.moaa .org/garrett, or visit www.moaa.org/financial center for other resources. PHOTO: SEAN SHANAHAN Despite the housing downturn, replacement costs — especially for homes made with expensive materials, such as brick or stone — remain high. You should have an annual review with your insurance 48 MILITARY OFFICER OCTOBER 2008 http://www.zillow.com http://www.moaa.org/garrett http://www.moaa.org/financialcenter http://www.moaa.org/garrett http://www.moaa.org/financialcenter
For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.