Part of my motivation for writing about homeowners insurance this week was personal—as a new homeowner last year, I made a colossal mistake when it came to my own insurance. I didn’t have any. That’s right—for about three months, my home was completely unprotected, which means any kind of damage, from a burst water pipe to a fire, could have destroyed me financially.
Here’s what happened: When we bought our home, our real estate agent helped us get homeowners insurance, and we paid for the first year of coverage at closing. Then, when our policy was up for renewal a year later, the bill was mistakenly sent to our real estate agent, and not to us. We never received the renewal notice, or the cancellation of policy notice. We assumed we were paying for homeowners insurance through our monthly mortgage payments, but we weren’t, and we had no idea that our policy had been canceled.
Fortunately, I discovered this mistake when I was organizing our financial paperwork one day. (Another reason to keep those household papers organized.) After making a few calls, I discovered the miscommunication and realized we had no coverage. A few quick emails later, and we bought a new policy—and triple-checked that the future renewal notices would be mailed directly to us.
The lesson, for me, is that no one is going to stay on top of the paperwork for you—not your insurance agent, mortgage broker, or insurer. After all, no one cares more than the homeowner herself if her home is suddenly destroyed. And in addition to all of the trends in homeowners insurance that make news, such as the rise in deductibles and possible hallowing out of coverage that I wrote about this week, sometimes ensuring that you have adequate coverage is as simple as keeping up with paperwork.
Now, I make a note to myself to check that our coverage renews automatically each year so we don’t have another lapse.