Is Your Homeowners Insurance Outdated? 5 Signs It’s Time for a Policy Review
Homeowners insurance is one of the most important tools for protecting your property, finances, and peace of mind. But many homeowners don’t realize that their policies—especially if they haven’t been reviewed in years—could be leaving them exposed to costly gaps in coverage.
At the Tom Gotham Agency, we regularly help Michigan homeowners uncover outdated policies that no longer match their property, belongings, or lifestyle. If any of the following apply to you, it may be time for a professional policy review.
1. You’ve Renovated, Expanded, or Upgraded Your Home
Whether you’ve finished a basement, added a new bathroom, installed a deck, or remodeled your kitchen, any structural change can affect the replacement cost of your home.
Your policy is likely based on the home’s original square footage and construction value. If you haven’t updated your coverage since your renovation, your home may now be underinsured—meaning you’d have to pay out-of-pocket to cover the difference in a loss scenario.
What to do: Notify your insurance agent after any major home improvement project so your dwelling coverage can be adjusted accordingly.
2. You’ve Purchased Valuable Personal Property
Standard homeowners policies include personal property protection, but that protection has limits—especially for items like:
Jewelry
Firearms
Tools or equipment used for side businesses
Electronics
Collectibles or artwork
If you've acquired expensive new items in recent years, they may not be fully covered under your current policy. Scheduling these items or adding endorsements can ensure proper protection.
What to do: Create a current inventory of your belongings and talk to your agent about whether you need additional personal property coverage.
3. Construction Costs Have Increased
Michigan’s real estate and construction markets have seen significant price changes in recent years. Labor shortages, supply chain disruptions, and inflation have all driven up the cost of rebuilding a home—yet many insurance policies haven’t been updated to reflect these changes.
If your dwelling coverage is based on outdated valuations, you may not receive enough to rebuild in the event of a total loss like a fire or severe storm.
What to do: Ask your agent to conduct a replacement cost estimation to ensure your policy reflects today’s actual rebuilding costs.
4. You’re Not Sure What’s Actually Covered
If it’s been years since you reviewed your policy—or if you’ve never read it carefully—you’re not alone. Many homeowners are unsure about key coverage details such as:
What’s excluded (e.g., flood, sewer backup, earthquakes)
Actual cash value vs. replacement cost
Coverage limits on personal property
Deductibles for different types of damage
Uncertainty during a claim is the last thing you want. A policy review can eliminate guesswork and ensure your coverage aligns with your expectations.
What to do: Request a policy walkthrough with your agent, especially if your current plan was selected quickly or bundled years ago.
5. Your Life or Household Has Changed
Your insurance should evolve as your life does. Events that may warrant a policy review include:
Getting married or divorced
Having children or becoming empty nesters
Starting a home-based business
Hosting short-term renters or listing your property on platforms like Airbnb
Each of these can affect your risk profile and your homeowners coverage needs.
What to do: Inform your agent about any major lifestyle changes to avoid gaps in liability or personal property protection.
Final Thoughts
A homeowners insurance policy isn’t something you should “set and forget.” As your home, possessions, and life evolve, your coverage should too. An annual review with your insurance agent can help you:
Stay fully protected
Identify opportunities to save
Adjust for inflation or market changes
Ensure peace of mind
At Tom Gotham Agency – Farm Bureau Insurance, we make policy reviews simple, informative, and pressure-free. Call our Fenton or Birch Run office or visit TomGothamAgency.com to schedule your review today.
