A Comprehensive Guide to Reviewing Your Colorado Insurance Policy Annual Renewal

As a responsible homeowner or policyholder in Colorado, you know that reviewing your insurance policy annually is crucial. Your insurance needs may change over time, and it’s essential to ensure that your coverage still meets your requirements. In this blog post, we’ll guide you through the key points to consider when reviewing your insurance policy’s annual renewal in Colorado, with a focus on homeowners’ insurance policies. We’ll discuss coverage amounts, deductibles, policy type, and special clauses to look out for.

1. Coverage Amounts

The first step in reviewing your insurance policy renewal is to evaluate your coverage amounts. Ensure that your coverage aligns with your current needs, considering factors such as:

• Home Value: The coverage amount should reflect the current replacement cost of your home, considering any improvements or renovations you’ve made.
• Personal Property: Assess the value of your personal belongings and ensure they are adequately covered. Remember that specific high-value items may require additional coverage.
• Liability Coverage: Verify that your liability coverage amount is sufficient to protect your assets in case of a lawsuit.

2. Deductibles

Deductibles play a significant role in determining your policy’s cost and how much you’ll pay out of pocket in the event of a claim. Consider the following deductible options:

• Standard Deductible: This is the amount you’ll pay before your insurance coverage kicks in. Review and adjust your deductible based on your financial situation and risk tolerance.
• Secondary Deductible: Some policies have secondary deductibles for specific types of claims, such as wind or hail damage. Understand these secondary deductibles and how they apply to your policy.

3. Policy Type – RCV vs. ACV

In Colorado, it’s essential to ensure that your policy is a Replacement Cost Value (RCV) policy rather than an Actual Cash Value (ACV) policy. RCV policies will replace or repair damaged items with new ones, while ACV policies factor in depreciation, resulting in lower payouts. Verify that your policy specifies RCV to maximize your coverage benefits.

4. Special Clauses

Colorado’s unique climate and geography may introduce specific insurance considerations. When reviewing your policy, pay close attention to any special clauses that may affect your coverage:

• Roof Payment Schedule: Some policies in Colorado may have special clauses related to roof damage. Ensure you understand how your policy handles roof replacement, repairs, or maintenance.
• Cosmetic Exclusions: Cosmetic exclusions can affect coverage for aesthetic repairs. Familiarize yourself with these exclusions, especially if you live in an area prone to cosmetic damage from hail or windstorms.
• Wildfire, Hail and Flood Coverage: Given Colorado’s susceptibility to wildfires and occasional flooding, make sure your policy adequately covers these risks or consider purchasing additional coverage if necessary.

Reviewing your insurance policy’s annual renewal in Colorado is a proactive way to ensure you have the right coverage in place. By considering coverage amounts, deductibles, policy type, and special clauses, you can better protect your home, belongings, and financial well-being. Don’t hesitate to reach out to your insurance provider for clarification or to discuss any necessary adjustments. Staying informed and adequately insured is the key to peace of mind in the Centennial State.