Local insurance agent Jo Barsh says regular insurance reviews are critical to ensuring you have the right amount of coverage for your home.

It’s understandable. You buy a new house, which means a new home insurance policy. You go with all of your agent’s recommendations, and you check that off your to-do list.

That policy renews every year without input from you. It’s set-it-and-forget-it, and you’re fine letting everything just continue as usual.

But of course, life never stays the same. Over the next 10 years, you have significant family changes. Maybe you get married or have a baby (or babies). Maybe you launch a home-based business. You make some large purchases — jewelry, firearms, etc.

Even if none of this applies, most certainly, the cost of goods and labor increases. And that’s precisely why local insurance agent Jo Barsh recommends regular home insurance checkups.

“They don’t want to call, because they don’t want the rates going up,” Barsh said. “But they don’t understand the backlash of that. If your house is not (insured) at full-replacement cost and you have a catastrophic loss, there’s a chance we’re going to put the outside back together, and we’re going to go, ‘OK, we’re done. We can’t put any walls up because you don’t have enough money.’

“So, if you’re not keeping your home (insurance) up to a catastrophic-loss level, that’s where you could essentially lose out,” she said.

THE COST TO REBUILD

Certainly in West Orange, the costs associated with building homes have increased. Those include the prices for goods such as tile, wood and fixtures, as well as the cost for labor.

Many policies have an inflation guard in place to accommodate for some of these increases. That guard typically ranges from 2% to 8%.

However, that increase might not keep pace with the increase in costs to rebuild your home. For example, if a homeowner paid $400,000 for his or her home in West Orange eight years ago, it might be worth $800,000 today. And although it wouldn’t cost $800,000 to build it back, it might cost $600,000. And if your policy doesn’t cover a $600,000 replacement cost, your money will run out.

Reviewing your policy and raising the replacement cost value will cause your premium to increase. But when you buy insurance, you’re paying to offset risk. If you’re paying for insurance that doesn’t adequately cover replacement costs, you’re not offsetting all of the risk.

LIABILITY

Another critical component of your insurance policy is the amount of liability coverage you carry. Like replacement cost, this amount should change as your life does.

“You want to make sure you have enough liability in there, because if they sue you and you don’t have enough liability in your policy, (your) life changes,” Barsh said.

Attorneys will examine your wealth and earnings, and if you’re found liable and don’t have enough insurance, your wages could be garnished.

“If you only have $100,000 (in liability coverage), and that’s what (Florida) requires you to carry in an insurance policy, is your home worth more than $100,000?” Barsh said. “Why would you carry less than what your home is worth? If you hurt someone in a car accident (and your house is paid off), that’s a lot of free money sitting right there. (And then you might have to) get a loan against your house to pay restitution.”

DON’T ASSUME

Anyone who has lived in Florida for any length of time has been through a hurricane. The wind and rain sounds like a freight train outside, and when it’s all done, you wait and watch for leaks or obvious damage.

If you see none, you breathe a sign of relief.

Not so fast.

Even if you see no damage, Barsh said it is a good idea to have your roof inspected following a major storm. Sometimes, the damage isn’t obvious, and symptoms might not appear right away. And if it does — and you have no documentation — it will be nearly impossible to prove the damage was related to a storm.

“You can’t file a claim on something that happened five years ago,” she said. “(Have) somebody come check. … Most roofers will come out and check your roof for free.”

For more information or to schedule your checkup, contact Barsh at (407) 299-0301 or https://jobarsh.com/.

TIPS FOR A SUCCESSFUL REVIEW

•  Confirm your home is insured for the estimated cost to rebuild. Ensure any replacement cost estimate reflects the actual characteristics of your home. Insuring your home for at least 100% of its estimated replacement cost — not the current market value — could give you the means to replace your home entirely in the event of a loss.

• Ask questions about current coverages, limitations and exclusions. You can get the best out of a meeting with your agent by asking about your current coverages and understanding any limitations and exclusions to the homeowners policy. You might be better prepared for a loss when you know what is covered and what is not.

• Create a home inventory. A home inventory is a listing of the property in your home, the date you bought it and what you purchased it for.

• Review home renovations. If you have added on to your home or updated any rooms in the house, tell your agent to ensure your coverage reflects the changes as your property’s value might have increased. Furthermore, share any changes to major appliances, because these might increase your home’s value.

• Share any significant life changes with your agent. Getting married, having a baby, starting a new home business or even getting divorced might trigger changes to your property that are worth a conversation to address the correct coverage with new needs.