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10 Reasons Your Insurance May Need a Checkup

If you answer yes to any of these questions, you need to make changes to your coverage.

It's a good idea to review your insurance coverage annually, but it's one of those tasks that most of push to the back of our to-do lists. If you haven't gotten around to it lately but have had a lifestyle change or made a major purchase, you shouldn't put off this important financial task any longer.

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According to the Insurance Information Institute (III), all of the situations below could affect your insurance needs and rates. If you answer yes to any of these questions, talk with your insurance agent to update your policy.

Have you gotten married or divorced? If you got married, you may get a discount on your auto insurance, according to III -- or find that you can save money by switching to your spouse's carrier. You might need to update your homeowners insurance to provide coverage for new valuables, such as wedding rings and gifts (see Upgrade Your Home Insurance). And you should review your life insurance needs now that someone else may be depending on your income. See how much life insurance you need.

If you got divorced over the past year, let your auto insurer know that you need a separate policy from your former spouse. And you might need renters insurance if you moved out of your home and into an apartment.

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Have you had a baby? Review your life insurance and disability income protection. You may need more life insurance to cover the costs of raising your child if something happens to you. Be sure to update the beneficiary designations on your policy to include the new child. And make sure you have disability insurance to help if you get sick or injured and can't work.

Did your teenager get a driver’s license? Your auto premiums likely will rise when your teen starts driving. But it is generally cheaper to add your teenagers to your auto policy than for them to purchase their own coverage, according to III. Here are eight ways to cut insurance costs for teen drivers.

Have you switched jobs or experienced a significant change in your income? You may need to purchase your own life insurance or disability policy if your former employer provided this coverage and your new employer does not (or doesn't provide as much coverage). If you got a pay raise with your new job and took on additional financial commitments (a bigger mortgage, for example), III recommends making sure that your life and disability insurance can cover those commitments. If your income decreased, you may want to cut your life insurance premiums (see 4 Ways to Save Money on Life Insurance).

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Have you done extensive renovations on your home? If so, report the changes to your insurance company so you won't be underinsured. And if you bought new furniture, electronics or exercise equipment for your addition, you may need to increase the amount of insurance on your personal possessions. The III's free Know Your Stuff tool will help you take an inventory.

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Have you decided to buy a vacation or potential retirement home? Make sure you research the availability and cost of homeowners insurance before you commit to the purchase. According to III, the factors that make a vacation home seem ideal, whether it is a waterfront property or a mountain retreat, can make it costly and difficult to insure. Be sure to ask about flood insurance if the property is close to water. If you already bought a vacation home, don't skimp on insurance because the risk of theft or disaster is no less in your second home than in your primary residence.

Have you acquired any new valuables such as jewelry, electronic equipment, fine art, antiques? According to III, a standard homeowners policy offers only limited coverage for highly valuable items. So you'll need extra coverage. You can do this by getting your items appraised and adding a “floater” to your policy to provide additional coverage for your valuables.

Have you signed a lease on a house or apartment? The landlord must insure the building, but you're responsible for insuring your possessions. Renters insurance isn't expensive, though, and provides liability coverage, which protects you if others are injured at your home or apartment.

Have you joined a carpool? You could lower your premiums if you're driving less. However, if you're the carpool driver, you might need to boost your liability insurance to cover the increased risk of additional passengers in your car.

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