The start of a new year is a perfect time for reflection and renewal—not just for your personal goals but for your financial health too. Among the many tasks we tick off in January, there’s one we often tend to overlook: reviewing our insurance policies.

An annual insurance review checklist can save you money, protect your assets, and keep your peace of mind intact. Sounds like a win-win, right?

Taking the time to evaluate your insurance at the beginning of the year isn’t just about ensuring you’re covered in the event of a crisis; it’s also about making sure your coverage is up to date with your life and changing needs. Here’s a step-by-step guide to help you tackle your new year’s insurance review like a pro.

Why is an annual insurance review important?

A lot can change in the span of a year. Perhaps you moved into a new home, added a teen driver to your car insurance, or even welcomed a new member to your family. These changes can have a significant impact on your insurance needs.

An annual review ensures you’re not underinsured or overinsured. Being underinsured can expose you to big financial risks, while being overinsured means you’re probably paying more than you need to. Your insurance should be aligned with your current lifestyle, goals, and assets. No more, no less. Taking stock at least once a year helps you stay ahead and avoid any surprises.

Beyond updating your coverage, this review also can reveal opportunities to save. Insurance companies adjust rates constantly, and you might discover discounts you weren’t aware of or spot areas where bundling policies could lower your premiums.

What to include in your annual insurance review checklist?

When reviewing your insurance, it helps to have a system in place. That’s where a trusty checklist comes in handy. Here’s what you should definitely include:

Homeowners or Renters Insurance

• Coverage limits: Does your policy still reflect the value of your home or belongings? Major home renovations, new furniture, or even pricey tech gadgets might require an update to your coverage.
• Natural disaster coverage: Not all disasters are covered by standard policies. Do you live near a dam or a waterway—even a creek? You might need flood insurance.
• Liability protection: Is your liability coverage high enough to protect you if someone were seriously injured on your property?

Auto Insurance

• Vehicle updates: Did you recently buy a new car or sell an old one? Make sure your auto policy reflects these changes.
• Mileage adjustments: If you’re driving significantly less (or more) than last year, notify your insurer. Your premiums may change based on your annual mileage.
• New drivers: Allowing a teen driver or adult family member to drive your vehicle for a long term? You likely need to add that person to your auto liability coverage.

Health Insurance

• Plan updates: Health plans often change each year. Are your current providers still in-network? Are your prescription drugs still covered?
• Flexible spending account (FSA) and health savings account (HSA) contributions: If have extra money, you may still be able to add contributions to your HSA to count toward deductions on your tax filing in April. If you have an FSA, it’s a good time to check if there’s unused money in that account left to spend or roll over, depending on your employer’s rules.

Life Insurance

• Beneficiaries: Did you experience any significant life events—marriage, divorce, or the birth of a child? Update your beneficiaries accordingly.
• Coverage amount: Is the amount still enough to meet your family’s needs? Factor in income changes, debt, and long-term goals like education for your children.
• Type of policy: If you have term life insurance, check how many years are left. Permanent life insurance? Review its cash value.

Disability Insurance

• Income replacement: Would your current policy provide adequate income if you couldn’t work due to a serious injury or illness? If your income has increased, adjustments may be necessary.

Umbrella Insurance

If you have significant assets, an umbrella policy can provide an extra layer of liability coverage. Re-evaluate your risk and determine if your umbrella policy limits are sufficient.

Business or Self-Employment Insurance

Entrepreneurs and freelancers should consider their professional liability coverage and business property insurance. New services, partnerships, or office setups might mean it’s time for an update.

5 tips for optimizing your insurance coverage

Now that you’ve reviewed your policies, there are a few savvy strategies to make the most of your coverage while keeping costs reasonable.

1.  Ask About Discounts

Many insurance providers offer discounts that you might not be aware of. Bundling (combining home and auto insurance), installing safety devices like smoke alarms, or maintaining a good driving record can lower your premiums.

2. Shop Around

Loyalty to one insurance provider is great, but it doesn’t hurt to compare quotes. New customers often get welcome discounts, and switching insurers could save you hundreds of dollars annually. Just be sure to avoid gaps in coverage during the transition.

3. Consider Higher Deductibles

Raising your deductible (the amount you pay out of pocket before insurance kicks in) typically lowers your premiums if you can afford it. This is especially useful for policies like auto and homeowners insurance.

4. Take a Look at Coverage Nuances

Review your auto policy for coverage of rental cars. You may be able to avoid substantial upcharges at the rental counter if your personal insurance covers vehicles you lease.

5. Review Long-Term Goals

Your financial goals evolve, and so should your insurance. If you’re saving for retirement, downsizing your home, or planning for future health expenses, adjust your policies to reflect those goals.

An annual insurance review doesn’t have to be overwhelming. By breaking it down into manageable steps with our checklist, you can confidently cross this task off your to-do list. Not only will this save you headaches down the road; it could also save you significant money in the present.

The team at IOA is here to help you with every step of the process. Whether you need advice on adjusting your policies, finding better rates, or understanding your coverage, we’re just a click away.

For help finding the best personal insurance coverage for you, call 1-833-546-2872.