You’re probably underinsured!
It's no secret that the rate of inflation has been on the rise lately. This is especially true in Pennsylvania, where home values have skyrocketed in recent months. If you're like most people, you probably purchased your homeowners insurance policy a while ago, when home values were much lower than they are now. This means that you may be underinsured today! You need to check with your agent and review your policy coverages right away.
Home is where the heart is, and for many of us, it’s also where our bank account goes to die. With housing costs rising faster than the national inflation rate, it’s becoming increasingly difficult to find affordable housing in the Keystone State. So if you're already a homeowner, consider yourself lucky.
Prices on average are up between 30-45% in some areas, depending on whether you’re buying, and what city you’re in. Homeowners have seen a massive spike in the value of their home, but also in the cost to replace it. This means that your home is probably underinsured.
According to a report from housing data firm CoreLogic, about 60% of all homes in the U.S. are underinsured—by an average of 20%. This means that if these homeowners were to experience a covered loss, they would only receive 80% of the insurance payout they need to fully repair or replace their home. Given the high cost of housing, elevated market costs, insurance fraud, and the frequency of natural disasters, this is a worrying trend. Homeowners who are underinsured are at risk of being left financially stranded if their home is damaged or destroyed. And more frequent and intense storms, the risk of catastrophic damage is only increasing. For these reasons, it's essential for homeowners to make sure they have adequate coverage. Otherwise, they could find themselves facing a daunting financial recovery process—or worse.
If you're not sure whether you have enough coverage, contact your insurance agent or company and ask for a review of your policy. They can help you determine whether you need to adjust your coverage limits or add any additional riders or endorsements.
