Your Home Has Changed. Has Your Insurance Kept Up to Provide You with the Protection You Expect?

By Matthew Blumkin, Esq., Chief Executive Officer & Managing Partner,

The Greenspan Co./Adjusters International

Over the course of owning a home, many individuals undertake renovations, additions, modifications, and improvements that represent a sizeable investment in their property. Concurrently, those individuals often do not consider the insurance protections they will need to account for the upgrades and changes they make to their property. This can often result in an underinsurance situation if there is a significant or sizable insurance claim.

A remodeled kitchen, custom cabinetry, upgraded flooring, or a newly constructed addition can substantially change the cost of restoring a home after a loss. These investments should prompt a conversation about whether the existing insurance coverage reflects the property as it stands today. For families who have spent years personalizing their homes, the details that make a property special can also be among the most difficult to document and value after a loss.

Limiting the risk of being exposed to an underinsurance claim can be undertaken by the homeowner and their team of insurance agents or brokers, contractors and outside professionals. This team should include professionals who understand and are aware of changes in market conditions, the specific changes that have been undertaken at the property, and the insurable interest based upon the terms and conditions of the coverages provided.

Often, the first time the homeowner realizes there is an underinsurance issue based upon a change in the property's condition is after a catastrophic event. At that time, increasing policy coverage will not address a shortfall in coverage for the loss that has already occurred. Therefore, it is critical that, at every annual review of their insurance coverage with their professional team, the homeowner or their team disclose and provide updated information regarding all modifications, repairs, construction projects, or changes at the property.

Maintaining records of the home’s improvements and contents is an important part of this process. Homeowners should retain construction contracts, invoices, architectural plans, and photographs that identify custom finishes and materials. A current home inventory can also help document furniture, artwork, electronics, and other personal property. Including photographs, receipts, descriptions, and purchase dates for higher-value items can provide a more complete record of what the homeowner owns. Keeping copies of these records digitally, accessible from outside the home, helps ensure they remain available if the property is damaged or destroyed. 

When there is an insurance claim, the homeowner should work with their team to present the full measure of the costs associated with repairs to the home, replacing or restoring personal property, and claiming any other applicable policy benefits. Having a clear understanding of the home’s pre-loss condition, finishes, and contents will allow the homeowner to fully develop the post-loss claims presentation. Relying upon the insurance company to determine the values may not fully capture the actual replacement costs given factors such as market conditions, the quality of the home or personal property, and the property’s unique characteristics.

For families, an uninsured shortfall can affect more than the rebuilding process. It may require drawing on savings or redirecting funds intended for other financial goals. Treating property insurance reviews as part of ongoing financial planning helps homeowners better protect both their homes and the resources they have worked to build.

About The Greenspan Co./Adjusters International:

Since 1946, The Greenspan Company/Adjusters International has helped homeowners and businesses navigate property insurance claims. Working exclusively for policyholders, our team manages the detailed work of documenting losses, evaluating repair and replacement costs, preparing and presenting claims, and negotiating settlements with insurers. Through experienced guidance and advocacy, we help clients address the complexities of their claims and pursue the full benefits available under their policies.