Many people assume they are fully covered until something goes wrong. What are the most common gaps in coverage you see, even among well-informed clients?
The most common gaps I see are in both auto and home insurance policies. On the auto side, many households are underinsured from a liability standpoint. Too many people carry limits that are barely above the state minimums, which can leave them exposed to major lawsuits after an accident. Increasing liability limits to a more appropriate level is usually much more affordable than people realize, especially when compared to the financial risk of being underinsured.
For homeowners insurance, many people unknowingly have Actual Cash Value coverage instead of Full Replacement Cost coverage. The difference in claim payouts can be substantial. I also recommend homeowners add service line coverage and sewer/drain backup endorsements, as these are among the most commonly used coverages in the Kansas City metro area.
How has the insurance landscape changed in recent years in ways consumers may not have noticed?
The auto insurance industry has changed significantly, particularly with the rise in uninsured motorists over the last 5–7 years. As more drivers go uninsured, rates increase because insured drivers are more likely to rely on their own policies after an accident caused by someone without coverage. This makes it especially important for consumers to carry strong uninsured and underinsured motorist limits.
What are some lesser-known factors that can significantly impact premiums or eligibility?
Claims frequency is a major factor. Insurance carriers have become much stricter with underwriting guidelines for both home and auto policies. On homeowners policies, having more than two claims within five years can make households ineligible with many carriers. For auto insurance, drivers with two or more at-fault accidents within three years may struggle to qualify for preferred coverage options.
When reviewing a policy, what details do people tend to overlook?
Deductibles and liability limits are often overlooked. Many consumers focus only on price and choose the cheapest option available, which usually means higher deductibles and lower coverage limits. Insurance should be viewed as financial protection, not simply an expense. I like to review quotes with clients so they understand the differences in coverage and the potential financial impact of choosing one option over another.
How do life changes affect coverage needs in ways people may not expect?
Insurance needs constantly evolve, which is why maintaining a good relationship with your agent is important. One of the biggest areas families overlook is life insurance. Major milestones like buying a home or having children should prompt couples to review their coverage and make sure they have enough protection in place to maintain financial stability if one income provider is no longer there.
What does taking a strategic approach to insurance look like in practice?
The best approach is scheduling an annual policy review with your agent. These reviews help uncover new insurance needs, identify necessary adjustments, and ensure clients fully understand their coverage. It also gives clients an opportunity to ask questions and make sure they are properly protected as their lives change.
What is something homeowners should watch out for in their homeowner’s policies?
Homeowners should be familiar with both their roof coverage and their deductibles. Over the last 4–5 years, many major insurance carriers have changed how roofs are covered on homeowners policies. Coverage can vary depending on the age of the roof, so it’s important to know whether your policy provides Actual Cash Value coverage or Full Replacement Cost coverage, as the payout difference can be significant after a claim. Homeowners should also pay close attention to their wind and hail deductibles. Many carriers have increased minimum deductible requirements in the Midwest, which can leave homeowners with larger out-of-pocket costs than expected if they are not aware of their policy details.
Office: 913-586-0020
Email: dlame@farmersagent.com
Insurance should be viewed as financial protection, not simply an expense.