Is your home really protected from natural disasters?

OPINION — As temperatures rise and storm season approaches, it's a good idea to review your homeowners insurance policy. Tornadoes, hurricanes, wildfires, flooding and other natural disasters can strike with little warning. If your coverage is outdated, you could find yourself without adequate protection when you need it most.

Many people set up a policy but rarely revisit it. But rising costs and changing risks in your area can affect the coverage you need and how much it costs. By reviewing your policy now, you can help identify gaps in coverage before an emergency exposes them.

To check that your homeowner's policy protects against a natural disaster's damage, consider these three things:

Coverage amounts: These should reflect what it would cost to rebuild your home in today's market, not what you paid for it years ago. One option is to add inflation protection, which automatically adjusts coverage amounts based on current costs in your area.

Personal property coverage: Make a list of important belongings and their estimated values to gauge whether your existing coverage is adequate. Keep in mind that high-value items, such as jewelry or fine art, may require additional coverage.

Loss of Use or Additional Living Expenses (ALE): If a disaster makes your home unlivable, this coverage helps pay for hotel stays, temporary apartment rentals and even extra meal costs while your home is being repaired or rebuilt. These costs can add up, so this coverage can be a big help during a crisis.

Standard homeowners insurance doesn't cover every disaster and typically excludes floods – including those that follow a hurricane – and earthquakes. These require separate policies. If you live in an area prone to either, those add-ons could be worth the additional expense.

If your premiums feel too high, there are ways to lower them without sacrificing coverage. You might qualify for savings with automatic payments or by bundling your home and auto policies. Raising your deductible is another option, although it means you'll pay more out of pocket before coverage kicks in, so make sure your emergency fund can handle the difference.

If you need help after a disaster, contact your insurance agent or broker quickly. Keep their information somewhere you can access at any moment, even if your phone is dead or the power is out. It's also smart to keep your financial advisor's contact information handy for help assessing the financial impact of a disaster and prioritizing short-term cash needs.

It's also a good idea to review your homeowners policy at least every five years. You might need to review it sooner if something could affect your coverage needs, such as a home renovation or a significant increase in construction costs. Ongoing reviews help ensure your coverage keeps pace with your home's value and the risks in your area. The time you spend going over your policy now could save you stress when it matters most.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

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