The devastating impact of the Coastal Fire in Laguna Niguel should serve as a wake-up call for all California homeowners to regularly make sure your insurance coverage is sufficient.
This is particularly important as prices for many goods and services are at a 40-year high. Rebuilding costs you may have calculated years ago no longer apply.
The first thing to do is call your insurance agent and ask him or her to crunch the numbers and see if your current coverage reflects market conditions. Insurers closely monitor rebuilding expenses.
Lumber, concrete, contractors — all these could be a lot more expensive now than you previously estimated.
Here’s a tip: Ask your agent about what’s known as an extended replacement cost endorsement. This is a rider you can add to your home-insurance policy that can help cover unexpected cost increases.
Such a provision may add a little more to your premiums, but it can also protect you from sticker shock if the price tag for rebuilding tops your original coverage amount.
Another tip: Once a year or so, make a point of going from room to room in your home videoing your possessions.
This can protect you from unwanted headaches should you have to submit claims for damaged or destroyed property such as your big-screen TV or kitchen appliances.
The last thing you want after a major fire is to have to bicker with your insurer over whether you really had a top-of-the-line home entertainment system, or if your couch was really as expensive as claimed.