You've purchased auto and homeowners or renters insurance like a responsible consumer. However, you could have insurance coverage gaps that threaten your assets. Here are a few common ones that you should consider closing as you save money, protect yourself and gain peace of mind.
Common coverage gaps to check
- Transportation Expense Coverage Your auto insurance covers medical expenses and liability. Does it also provide you with a rental car or other transportation after an accident? Transportation Expenses coverage can cost as little as $8 per vehicle per year and gives you access to a rental vehicle or other form of transportation. It lessens your stress after an accident and minimizes disruptions to your daily life.
- Personal Catastrophe Liability Coverage Also known as an umbrella policy, personal catastrophe liability coverage protects your assets if you are sued after an accident. It can cover any expenses related to a personal injury or liability lawsuit and any lawyer fees, hospital bills and related expenses you may incur. This coverage starts at $150 per year and provides priceless peace of mind for you and your family.
- Valuables Coverage The average homeowners insurance policy includes a $3,000 limit on personal items. Does that amount cover the replacement of your expensive electronics, jewelry, artwork and furs? If not, buy an endorsement or rider. It gives you extra coverage for valuables and protects your items if they are lost, stolen or damaged.
- Flood Insurance While you might not live in a high-risk flood area, one in five flood claims occur outside of high-risk flood areas, and an inch of water can cause major damage to your home and possessions. Protect yourself with flood insurance. In many cases, there's a 30-day waiting period for this coverage, so apply for it early to reduce your risk.
- Life Insurance Your group life insurance policy may cover you for twice your annual salary, but that money is probably not enough to cover your final expenses and care for your family. Purchase your own policy with a death benefit of six to eight times your annual salary. Investigate different types of life insurance policies and coverage amounts as you care for your loved ones.
- Outdated Insurance Policies You pay your insurance premiums on time so that your policies don't lapse. When was the last time you reviewed your coverage? Adjust your homeowners coverage after renovations or when you sell collectibles. Check your auto coverage, too, to ensure it's sufficient for your household vehicles and drivers. Policy reviews take a few minutes but can save you thousands of dollars and give you hours of priceless peace of mind.
Your insurance coverage protects your assets. Consider closing any gaps today. For guidance on liability limits and excess coverage, see Comprehensive Personal Liability, and for an overview of personal insurance options, see Personal Lines Insurance: Your Financial Safety Net. If you'd like assistance, talk to your agent.
Frequently Asked Questions
Does my regular auto policy usually include a rental car after an accident?
Not always—transportation expense coverage is often optional, so check your policy and consider adding it for minimal cost.
How much umbrella (personal catastrophe) coverage do I need?
Coverage needs vary by net worth and risk; many consumers start with $1 million but review options with an insurance professional to match your situation.
Should I schedule jewelry and expensive electronics separately?
Yes—high-value items often exceed standard policy limits and are best covered with an endorsement or rider listing each item and its value.
Is flood damage covered by my homeowners policy?
Generally no; flood damage typically requires a separate flood insurance policy, which may have a waiting period before it becomes effective.