Are You Protected? The Five Most Common Homeowner Shortcomings

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This time of year can be a stressful time for homeowners.Homeowner shortcomings

Hurricanes threaten America’s East Coast most years while wildfires and floods often plague the West. Meanwhile, tornadoes remain a concern throughout much of the country’s midsection.

Residences often bear the brunt of all this wild weather, so right now would be a good time for you to double-check your coverages to make sure there’s enough protection in place should the worst happen to your home.

According to a recent study by a provider of building cost data, nearly 60% of U.S. homes are underinsured, leaving almost two out of every three American homeowners at risk of financial disaster in the event of a catastrophe. “Underinsured” is defined as any property that only carries enough insurance coverage to pay up to 78% of potential replacement costs.

Are you among this 60%? Chances are good that you are!  Here are some of the more common mistakes that homeowners make to earn entry into this less-than-ideal risk group.

#1: Just Covering Your Mortgage

In an ideal world, the amount you owe on your home should be less than the actual value of your home. The 2008 real estate crash pretty well laid that “rule” to rest, but the fact remains that too many people just think about their mortgage value when selecting their homeowners policy. In the event of a loss, these homeowners can pay off their mortgage, but not necessarily rebuild their home.

This is a great reason to give us a call to help shop your homeowners insurance. A basic analysis of costs at the time of purchase will help avoid this problem entirely.

#2: Remodel and Forget It

Renovating a home can be a costly and stressful experience, but the good news is that such projects usually result in higher property values going forward, meaning homeowners can often recover that investment when they sell their home.

Why not increase your property coverage once the renovations are done? Many people forget to call and update their home’s value. Others are unaware that certain property improvements might even trigger new types of coverage as well.

For example, if you put in a pool, you may need to upgrade your homeowners insurance, but you may also need umbrella liability insurance.

#3: Forgetting About Flood Insurance

As a general rule, flooding is not covered by typical homeowners policies. If you own a home near a body of water — including lakes and streams – you should buy a flood insurance policy to protect your property.

Almost as serious of an oversight as forgetting about flood insurance entirely is thinking that you don’t need it just because you live inland. You’re at risk if you live anywhere near water of any sort.

#4: Updated Building Codes

Construction standards have evolved greatly over the decades. A lot of the work that was done years ago on older homes may not pass muster with today’s more stringent building code standards. In the event of a disaster, older homes wouldn’t just need to be rebuilt, but to be brought up to code as well.

This can get expensive and needs to be taken into account when choosing a homeowners insurance policy. If you own an ‘older’ home, we really should discuss your home’s age and construction costs for this very reason.

#5: Material Costs are on the Rise

Inflation impacts everything we buy and construction materials are no exception.

According to, replacement costs have risen by roughly 7% per year since 2001 due in large part to surging prices for building materials, energy, and labor.

These are all reasons why 1) your coverage needs to be revisited each year and 2) insurance costs continue to rise.

At Warwick Agency, we re-shop your policies each year to ensure that you’re receiving the best coverage at the best price.

Be sure to keep us in the loop when things change, though, like an upgrade or construction to your home.  Call us today at 203-775-2564 and let’s look over your coverage to make sure you are fully protected before it’s too late.

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