Protecting your property with insurance
Help shield your property and financial future from harm and consider these factors when purchasing homeowners, auto or umbrella insurance.
When protecting your physical assets, property and casualty insurance can not only help protect you from the financial consequences of physical damage to your property, but also liability if someone else is harmed.
But with the breadth of insurance options out there, it can be difficult to understand what type and how much coverage you may need for your unique situation.
An Ameriprise financial advisor is here to help you understand the protection you have and identify potential gaps in coverage. Here are factors to look for when purchasing or reviewing coverage:
Homeowners insurance
Why buy homeowners insurance?
Homeowners insurance helps protect your home and belongings against various damages, such as theft or fire. It typically includes liability coverage, which may help protect you if you're found legally responsible if someone is injured at your home or you cause damage to someone else's property.
What to consider when deciding on coverage
As you review your options, it’s important to understand what a basic homeowners policy does and doesn’t cover, and how high — or low — of a deductible you’re comfortable paying in the event of an unexpected event. For example, will your policy cover the cost of damages to your roof, if it’s older? Will it cover rental expenses, while your home is being repaired from damage? Consider how much protection a basic homeowners policy offers, and then determine if you’re comfortable with that level of coverage, or if you would prefer more to help ease your mind.
| What a basic policy generally covers | What a basic policy generally doesn't cover |
|---|---|
|
Repairs or replacement of your home, other structures on the premises, your personal belongings and temporary living expenses for damage due to fire and smoke, tornadoes, hail and wind, power surges and theft.
Liability protection, covering the costs of damages that you or your family are responsible for causing to others while they are in your home, including property damage and the cost of defending you in lawsuit. |
Damage from sewer/septic and sump pump backups, floods, earthquakes, mold, wear and tear, neglect, pest and home maintenance. |
Know if you need additional protections
Here are some scenarios where you may need additional coverage:
- If your home is in an area that is at higher risk for natural disasters, you may need to have additional coverage for events like wildfires, hurricanes and floods.
- If your net worth exceeds your default liability coverage, consider increasing your coverage or adding an umbrella policy if someone is injured at your property and sues.
- If you have a lot of valuable personal assets such as art or jewelry, consider a scheduled personal articles policy. Though your basic policy covers personal possessions, there are usually limits. Adding a scheduled personal property policy allows you to increase those limits so you’re fully covered.
- If you have made upgrades to your home or added any buildings to your property, consider reviewing your coverage to ensure that you have adequate coverage. Upgrades like a new roof or siding can even reduce costs or prevent exclusions on your policy.
Look for opportunities to save money
Small improvements in your home can often lead to discounts. Insurance companies typically offer premium reductions for making your home safer and more energy efficient with security systems, carbon monoxide detectors, sprinkler systems, insulation and weather stripping.
Advice spotlight
Review your property and casualty insurance annually to capture additional savings. In general, it’s wise to review all insurance policies annually, but especially important for property and casualty coverage because your insurance premiums can change significantly from year to year. Consider reviewing your policies regularly with multiple carriers to ensure you receive the coverage you need at a competitive rate.
Umbrella insurance
Why buy umbrella insurance?
Sometimes known as excess liability or personal liability insurance, umbrella insurance can be vital if you have considerable assets, including property or savings, since it can help protect them if you’re sued. It works by supplementing other liability policies you likely already have in place from your auto, homeowners or renters insurance and is designed to kick in when the liability coverage on those policies has been exhausted. In some cases, umbrella policies can cover legal fees and damages stemming from libel, slander or defamation claims. Though umbrella policies tend to be relatively inexpensive, they can provide an extra layer of financial protection against the unexpected.
What to consider when deciding on coverage
In assessing your appropriate level, consider the value of all assets to be protected, including the potential loss of future income, since liability lawsuits can stake a claim on both assets and potential future income.
Know if you need additional protections
Those who may want to consider an umbrella insurance policy include individuals who:
- Have substantial assets
- Own a pool, trampoline or pet
- Are a landlord
- Are elderly or disabled
- Employ individuals to carry out household tasks
- Volunteer or coach children’s sports
- Participate in recreational activities that could injure others
- Have young drivers in the family
- Frequently host parties
Auto insurance
Why buy auto insurance?
Most states have minimum insurance requirements to legally drive an automobile. Auto insurance provides protection for injuries or property damage due to an accident, and driving without it is against the law in almost every state. Failing to have adequate insurance can be extremely costly if you ever get in an accident — especially if you’re at fault.
What to consider when deciding on coverage
Auto insurers offer varying levels of protection for drivers to safeguard themselves while on the road, and you’ll need to determine how comprehensive of a policy you’ll want. There are many additional protections that you can add onto your policy, such as liability coverage, collision coverage, comprehensive coverage, uninsured motor coverage and personal injury protection. You’ll want to carefully review them all, understand what is and isn’t covered, and consider how high of a deductible you want to pay. You’ll also want to factor in your external circumstances. For example, if you live in a city with a higher risk of car theft or in an area that has extreme weather, then you may want to add on comprehensive coverage, which covers theft and damage to your vehicle due to floods, hail, fire, vandalism, falling objects or if you hit an animal.
Look for opportunities to save money
Seek out and ask about discounts. Most insurers have different programs that will reduce your premium, including those for safe drivers, good students, seniors and those who bundle other coverage or have been long-time customers.
Advice spotlight
Keep your liability coverage in line with your net worth to help protect yourself financially. As your wealth grows, consider reassessing your auto, home or other property insurance to ensure it aligns with your net worth. Having that level of coverage can help protect you financially if you’re ever involved in a lawsuit.
Learn more: Debunking 10 common myths about insurance
Renters insurance
Why buy renters insurance?
Renters insurance helps replace your belongings such as electronics, furniture and clothing if stolen or damaged. It also provides liability coverage if someone else is injured or gets their property damaged in your home. Finally, if your rental is damaged or destroyed, it can pay for accommodations elsewhere while it’s being repaired.
What to consider when deciding on coverage
Renters insurance typically covers a wide range of circumstances, but it does not cover everything: Damage due to floods, earthquakes and landslides are not usually covered, nor are pest infestations. Depending on your insurer, you may have the option of purchasing a separate policy to cover these events.
Learn more: Protecting your earned income with disability insurance and life insurance
We’re here to help you prepare for the unexpected
Your Ameriprise financial advisor can help you understand how your property protection options — whether auto, home, renters or umbrella insurance — fit with your overall financial goals.
When you’re ready to reach out to an Ameriprise financial advisor for a complimentary initial consultation, consider bringing these questions to your meeting.
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