A recent survey found that homeowners inhabit about 66.6 percent of housing units. Conversely, renters live in 33.4% of units. Both these types of occupants should insure their residences and contents.

Homeowner’s insurance is essential since it protects your investment from various losses. Also, every mortgage company requires borrowers to have insurance coverage for their property. The firm will only advance a loan or fund a residential real estate transaction if the borrower can provide proof of coverage.

Many landlords need tenants to have a renter’s insurance coverage as well. As a homeowner, you may need to conduct policy assessments regularly. Evaluations ensure you upgrade your homeowner’s insurance to the next level if necessary.

But there are some advantages and disadvantages associated with upgrading your homeowner’s insurance policy. Read on to discover the pros and cons.

Pros Of Upgrading Homeowner’s Insurance

The home you live in now is likely not the same as when you purchased it. You may have made some home improvements. Based on your coverage and the value or kind of renovation, you may need to upgrade your home insurance.

Some renovations involve expanding your space, whether inside or outside. In this case, your insurance needs an upgrade to include the new value of the increased square footage.

A portion of your insurance rate gets determined by the square footage of your home and the cost of fixing or repairing it. These aspects help in establishing how much protection you need.

Renovations may increase the value of your home, increasing the coverage it needs. If a disaster happens and you have not increased coverage, your current plan may not cover your new home improvements. Therefore, you may need to pay out of pocket.

The same holds true for contents. Many homeowners insurance policies only cover damage that is done to the home itself and do not cover damage done to possessions inside the home. If you have not reviewed your coverage in the past year, and a disaster occurs, your insurance may not cover any new possessions that have been bought in that time.

Upgrading your home insurance ensures you have the correct coverage to safeguard your home and belonging. Also, new discounts may result from upgrading your homeowner’s policy.

Cons Of Upgrading Homeowner’s Insurance

Upgrading your home’s policy is likely to result in higher costs through increased premiums. Home insurance is a costly but necessary home maintenance feature.

Further, home insurance policies may not cover all kinds of damage that occur. For example, the destruction caused by storms and floods is not included in the coverage in some areas. You may end up paying more due to an upgraded plan only to find some damages are not covered.

Be sure to read and understand the components of your coverage. Take the time to consult with your agent for any changes or concerns and to see if a need for upgrades exists.

Protect Your Home

The longer you reside in your home, the more you make changes that drive up its value. Upgrading your homeowner’s insurance as you carry out home improvements has pros and cons.

Your home may be your most prized investment. If any property damage occurs, paying for it on your own might be unrealistic.

The right homeowner’s insurance allows you to let go of such worries. The right coverage is affordable and includes all renovations made.

Contact the Bicknell Insurance Team today and let us help you review your policy to see if you are fully protected.