Evaluate Your Insurance Coverage

Insurance can be one of your greatest costs, so it pays to evaluate it annually. But you’ll definitely want to ensure that policy terms and regulations, as well as your own needs, haven’t changed. Are you on the best plans possible at the least possible insurance cost? Be sure that each insurance company you use still is highly rated. Are beneficiaries correct? Are there any new provisions available that are important? We’ve heard of people who had gotten divorced, yet forgot to update the beneficiaries on their life insurance policies. As a result, proceeds inadvertently went to ex-spouses!

Here’s a yearly checklist to make sure your insurance coverage is adequate:

- Life insurance—Do you have adequate life insurance? If you’ve had another child this year, you may need more. You may also need more if your assets have grown so much that you’ll owe estate taxes. Have you married, divorced, or added children to the family? In that case you may need more insurance. You also may need to change beneficiaries.

- Disability insurance—Do you have enough disability insurance? Again, if you’re making more money, you may need more coverage.

- Auto and homeowner’s coverage—You might need more coverage if you live in an accident-prone area or are more vulnerable to tornados, earthquakes, hurricanes, or floods. You might want to consider getting umbrella insurance. Got a new diamond ring? You might also need to add personal articles insurance coverage for any new valuables.

- Long-term care—Do you have enough long-term care insurance coverage? This insurance keeps changing, so you need to watch it. For example, today, it’s common to be insured for home health care, nursing home living, and assisted living. This was not the case several years ago, when each peril was covered by separate policies.

- Health and dental—Review your health insurance and dental insurance coverage. You want to make certain your company still is financially sound. You also want to review your coverage to make sure it is adequate. Plus, you want to keep it as inexpensive as possible.