Have you noticed how quickly prices rise these days? It’s enough to make your head spin. ‘Inflation’ impacts how much we pay for necessities like food, gas, utilities, housewares and services.
This should make you think about your insurance.
Is your current coverage enough to protect you against the ‘inflating’ costs?
When you bought your house, several years ago, $600,000 property coverage was sufficient. Today, with construction prices so high, that might not be enough to replace your home.
The same applies for your business property insurance. The current value of your inventory and/or machinery may be much more now than it was when you first purchased your insurance policy. Are you covered?
With inflation so high we recommend a careful review of your policy to ensure you have enough property coverage in the event of loss.
We do want to share that many policies today include a coverage called INFLATION GUARD.
What is INFLATION GUARD?
Inflation guard on a policy increases your property coverage every year, usually by 2-8%. For example, let’s say you bought a house in 2015 with $500,000 of building coverage which included an inflation guard. Today, 7 years later you might automatically have more than $650,000 of coverage on your property because of the annual inflation increase. The Inflation guard on your policy will grow your coverage annually, so you will not find yourself severely underinsured several years after you buy a policy.
When you notice that your premiums have gone up, there’s a good chance that the inflation guard affected that -- in which case we strongly advise against lowering your coverage limits.
Unsure whether you have enough coverage in this inconsistent economic time? Give us a call, and we will review your coverage to ensure you are properly protected.