Why a Home Insurance Review Is More Important Than You Think

You bought your home insurance policy years ago when you closed on your house. Your insurance agent explained the coverage, you signed the paperwork, filed it away, and haven’t thought about it since.

Sound familiar?

For most homeowners, insurance is a “set it and forget it” purchase. You pay the premiums when they’re due and hope you never need to file a claim. But here’s the uncomfortable truth: that policy sitting untouched in your filing cabinet (or buried in your email) may be leaving you dangerously exposed.

Your home, your belongings, and your financial future deserve better than outdated protection. That’s why a regular home insurance review isn’t just a good idea—it’s essential for protecting what matters most.

Let’s break down why you should review your home insurance coverage annually, what specific areas need your attention, and how a simple check-in could save you thousands while preventing future headaches.

What Is a Home Insurance Review?

A home insurance review is a systematic assessment of your current homeowners insurance policy to ensure it still meets your needs and provides adequate protection. It’s not the same as shopping around for new insurance (although that might be an outcome).

Think of it as an annual wellness check for your financial protection. During a home insurance review, you or your agent will examine:

• Your dwelling coverage limits (the amount to rebuild your home)
• Personal property protection
• Liability coverage
• Special endorsements for high-value items or specific risks
• Deductibles and out-of-pocket expenses
• Potential home insurance discounts you might be missing

The goal isn’t necessarily to change home insruance carriers or save money (though both might happen). The real purpose is ensuring your coverage has kept pace with your life and your home’s current replacement value.

Why You Need a Home Insurance Review

Life Changes That Impact Your Coverage

Life doesn’t stand still after you buy home insurance—and neither should your coverage.

Renovations and Home Improvements

Imagine investing $75,000 in a kitchen renovation with top-of-the-line appliances and custom cabinetry. Your home’s value increases, but your insurance coverage remains stuck at the pre-renovation amount. If disaster strikes, you could be short tens of thousands in rebuilding costs.

Other improvements that often go unreported to insurers include:

• Bathroom remodels
• Finished basements
• Deck or patio additions
• Solar panel installations
• New roofing or siding

Family and Household Changes

Got married? Had a child? Empty nest? Each shift in your household can impact your insurance needs:

• Marriage often brings additional belongings that need protection
• A new baby might prompt you to increase liability coverage
• Adult children moving back home may bring expensive electronics or collections
• Divorce might necessitate policy changes and reassessment of covered belongings

High-Value Acquisitions

That anniversary jewelry, art collection, or high-end electronics? Your standard policy likely has strict limits on these categories, often far below their actual value. Without scheduling these items during a home insurance review, you might discover they’re barely covered when it’s too late.

Market Forces and Inflation Impact

While your policy sits unchanged, the world around it shifts dramatically.

Building costs have skyrocketed in recent years, with lumber prices, labor shortages, and supply chain issues driving reconstruction costs to historic highs. A home that cost $250,000 to rebuild five years ago might now require $325,000 or more.

Many policies have an “inflation guard” feature, but these automatic adjustments rarely keep pace with actual construction cost increases, especially in today’s volatile market.

This creates dangerous “insurance-to-value” gaps where your dwelling coverage falls significantly short of your home’s true rebuilding cost. Without a thorough home insurance review, these gaps widen every year.

Carrier and Policy Changes

Insurance companies constantly adjust their risk appetite, policy language, and coverage options. Without regular reviews:

• You might miss new, broader coverage options that weren’t available when you first purchased
• A carrier could be reducing coverage through subtle policy language changes
• Premiums might be increasing while coverage remains static
• You might be paying for endorsements you no longer need

In today’s consolidating insurance market, carriers sometimes non-renew entire regions or move policyholders to less comprehensive coverage options. A regular review helps you stay ahead of these changes.

Liability Considerations

The standard $100,000 liability limit from a decade ago is woefully inadequate in today’s litigious society. Medical costs have soared, and a single slip-and-fall on your property could trigger a lawsuit exceeding your policy limits.

A proper home insurance review assesses whether your liability protection needs expanding, possibly with an affordable umbrella policy that provides millions in additional coverage for a relatively small premium.

How Often Should You Review Your Home Insurance?

While there’s no perfect answer, insurance agents recommend annual home insurance reviews as a best practice. This yearly check-in aligns with your policy renewal and gives you an opportunity to catch coverage gaps before they become problems.

Additionally, you should review your coverage whenever:

• You complete home renovations or improvements
• You make significant purchases (jewelry, art, electronics)
• Your family situation changes (marriage, divorce, children)
• You start a home-based business
• You install security systems or protective devices
• You experience major life events that change your financial situation

Many homeowners find it helpful to schedule their home insurance review during a specific annual event — like spring cleaning, end-of-year financial planning, or home maintenance — to establish a consistent routine.

What to Look for During a Home Insurance Review

Dwelling Coverage: The Foundation of Your Policy

Your dwelling coverage (Coverage A) should reflect what it would cost to rebuild your home from the ground up at today’s construction prices—not its market value or what you paid for it.

During your home insurance review, verify that your dwelling limit accounts for:

• Current local construction costs per square foot
• Your home’s specific features and finishes
• Built-in systems like HVAC, electrical, and plumbing
• Attached structures like garages and decks

If your policy is even a few years old, chances are your dwelling coverage needs adjusting. Remember, being underinsured by just 20% could trigger coinsurance penalties that reduce claim payments across the board.

Personal Property Protection

Most policies set your personal property coverage (Coverage C) as a percentage of your dwelling coverage—typically 50-70%. But is that enough for your belongings?

A thorough home insurance review should include:

• Verifying whether you have Actual Cash Value (depreciated) or Replacement Cost coverage
• Checking category limits for high-value items like jewelry, art, and electronics
• Ensuring you have appropriate scheduled property endorsements for valuable items
• Confirming coverage for items stored away from home (college dorms, storage units)

Pro tip: Create a home inventory with photos and descriptions of valuable items. Not only does this help in a claim situation, but it also makes your home insurance review more accurate and effective.

Liability Protection

Your homeowners policy protects more than just your stuff—it shields your financial future from lawsuits.

Standard policies often start with $100,000 in personal liability coverage, but in today’s world, that’s rarely enough. During your review, consider:

• Increasing your liability limits to at least $300,000 (we always recommend $500,00)
• Adding an umbrella policy for $1 million or more in additional protection
• Assessing additional liability risks (pools, trampolines, dogs, home businesses)

The good news? Increasing liability limits is surprisingly affordable. During a home insurance review, you’ll often find that doubling or tripling your protection costs just a few dollars more per month.

Endorsements and Additional Coverage

Standard policies have significant limitations and exclusions. Your home insurance review should identify gaps that need addressing through endorsements like:

• Water backup coverage for sewer and drain backups
• Ordinance or law coverage for rebuilding to current codes
• Equipment breakdown coverage for home systems
• Identity theft protection
• Scheduled personal property for high-value items
• Special computer coverage
• Home business endorsements

Without these add-ons, you could face expensive surprises when you file a claim.

Deductibles

Your deductible is what you’ll pay out-of-pocket before insurance kicks in. But not all deductibles are created equal:

• Fixed-dollar deductibles (like $1,000 or $2,500) apply to most claims
• Percentage deductibles for wind/hail (common in storm-prone areas) are based on your dwelling coverage — so a 2% deductible on a $400,000 home means you’re paying $8,000 before insurance helps

During your home insurance review, consider whether your current deductible balance offers the right trade-off between premiums and out-of-pocket exposure.

What Most People Miss in a Home Insurance Review

Even when homeowners check their policies, they often overlook critical gaps that can lead to financial disaster. Here are the most common mistakes:

Undervalued Dwelling Coverage

Most underinsurance happens gradually as rebuilding costs rise while coverage remains static. Your policy might show a dwelling limit that sounds impressive, but would it actually rebuild your home today? Professional insurance reviews often find homes underinsured by 20-40%.

Fix it: Work with your agent to calculate an accurate rebuilding cost based on current local construction pricing, not market value or tax assessments.

No Water Backup Coverage

Standard policies exclude water damage from backed-up sewers and drains—one of the most common and expensive household disasters. A finished basement can sustain tens of thousands in damage from even a minor backup.

Fix it: Add water backup coverage with adequate limits (minimum $10,000, but $25,000+ for finished basements).

Actual Cash Value Instead of Replacement Cost

With Actual Cash Value coverage, you’ll receive only the depreciated value of damaged items. That five-year-old TV? You’ll get a fraction of what a new one costs.

Fix it: Upgrade to Replacement Cost coverage for your belongings, which typically costs just 10-15% more but provides significantly better protection.

Missing Extended Replacement Cost

If a widespread disaster strikes your area, building costs can temporarily surge due to demand. Extended Replacement Cost coverage provides an additional 25-50% above your dwelling limit if needed.

Fix it: Add Extended Replacement Cost coverage to protect against disaster-related cost increases.

Inadequate Coverage for Home Offices

If you’re one of the millions who now work from home, your business equipment might have limited coverage, and liability related to business activities could be excluded entirely.

Fix it: Discuss home business endorsements or a separate business policy during your next home insurance review.

How to Conduct a Smart Home Insurance Review

The DIY Approach

If you’re comfortable with insurance terminology and have time to research, you can start with a self-assessment:

1. Locate your current policy and declarations page
2. Create a checklist of coverage limits and endorsements
3. Document changes to your home and belongings since purchase
4. Research current rebuilding costs in your area
5. Identify potential gaps based on your situation

We’ve created a comprehensive Home Insurance Review & Bonus Inventory Checklist you can download to guide your self-assessment.

The Professional Approach

While DIY reviews are better than nothing, they often miss nuances that professionals catch. At IronPoint Insurance Services, our home insurance review process includes:

• A comprehensive analysis of your current coverage
• Identification of potential gaps and recommendations
• Assessment of your home’s current rebuilding cost
• Exploration of multi-policy discounts and savings opportunities
• An updated inventory of high-value possessions
• A review of available endorsements for your specific needs

As independent agents, we’re not tied to a single insurance company. We can compare options across multiple carriers to find the perfect balance of coverage and value.

What You Gain from a Home Insurance Review

Taking the time for an annual home insurance review delivers benefits far beyond peace of mind:

Financial Protection

The primary purpose of insurance is transferring financial risk. A proper review ensures you’re transferring the right amount of risk while remaining prepared for the portion you retain (deductibles).

Premium Efficiency

Surprisingly, better coverage doesn’t always mean higher premiums. A thorough review often identifies:

• Missing home insurance discounts you qualify for
• Bundling opportunities with auto or other policies
• Unnecessary coverages you’re paying for
• More competitive options from other carriers

Claims Confidence

There’s nothing worse than discovering coverage gaps during a claim. Regular reviews mean you’ll know exactly what’s covered before disaster strikes.

Keeping Pace with Life

Your insurance should evolve as your life does. Annual reviews ensure your protection grows alongside your home equity, possessions, and family responsibilities.

Market Awareness

The insurance market changes constantly, with new coverages, carriers, and options emerging. Regular reviews keep you informed about better alternatives as they become available.

Your Next Step: Schedule Your Home Insurance Review

Your home is likely your largest investment. The financial security of your family depends on having the right insurance protection in place when you need it.

Don’t leave that protection to chance or outdated coverage decisions.

At IronPoint Insurance Services, we specialize in thorough, no-obligation home insurance reviews designed to identify gaps, find savings, and ensure your coverage keeps pace with your life.

Contact us today to schedule your complimentary review or start the conversation online. Our experienced team will help you understand your current coverage, identify potential improvements, and ensure your home and family have the protection they deserve.

Because when it comes to protecting what matters most, “good enough” simply isn’t good enough.