Did you know that out of the 76 million households in the United States, about 4.3 million are multi-generational households? A multi-generational household consists of at least two adults or two non-sequential generations. For instance, a household with grandchildren and grandparents of any age.
The Cause behind the Sudden Rise of Multi-Generational Households
The rise of multi-generational households in the United States is due to the recession followed by its recovery. Often, you will find unemployed adults living in multi-generational households than working adults.
According to the Pew Research Center, the long-term increase in multi-generational household reflects the changing racial and ethnic composition of the country. 27% of Asian-Americans live in a multi-generational household whereas 14% Hispanic whites live in a multi-generational household.
Other factors that lead people to live in a multi-generational set-up include health and disability issues, the growing need for easy access to caregivers, people marrying later and choosing to live at home, and Baby Boomers wanting to provide for their elderly parents by moving them into their home.
For this reason, the importance of having home insurance for multi-generational households has grown. The greater the number of people reside in your household, the more insurance coverage you will need due to increased activity at home of people coming and going, including their guests.
If you live in a multi-generational household, it is time you reevaluate your insurance coverage to ensure you have the required policies needed to protect yourself.
The Policies You Need to Add to Your Home Insurance Coverage
If you are moving your parents or grandparents in or your children are still living with you, consider adding the following policies to your existing home insurance coverage if you haven’t already:
Add Another Driver
If your parents still drive or your adult child has moved back in with you, you will need to add them to your auto insurance coverage. If you do not add them to your coverage, you are putting yourself at risk in the event your parent or adult child get into an accident. Remember, the more drivers you add to your policy, the higher the rates will be. If their driving record is not clean, the rates may be even higher.
Usually, rates tend to be lower for people aged 40 to 60. You can ask your insurance company beforehand if that’s the case. If you are moving your parents in with you, consider having the “talk” with them. The “talk” involves discussing if they should be driving or not. If you conclude that they should, request them to drive the car only in the morning, not night, and only travel short distances.
Protect Personal Belongings
Most home insurance policies provide coverage for about 50% to 75% of your home’s value. Therefore, you need to re-evaluate your insurance coverage limits after your parent, grandparent, and/or adult child moves in with you.
For instance, you can add a valuable-article rider or scheduled personal property policy to your home insurance coverage. The reason why you need to consider doing so is because they might bring in family heirlooms, valuable furniture, antiques, jewelry, and/or art with them.
The need for protecting their personal property and items becomes even more important if they have sold their home and discontinued their own homeowner’s insurance coverage. Even though your adult children will not be bringing expensive items such as jewelry with them, you cannot discredit the value of other items like electronics, furniture, clothing, and among other items.
Lastly, if you are renovating your home because you want to either customize the existing space or add a space for your parents or grandparents, you will benefit in doing so, as you are increasing the value of your home. Additionally, any structure changes that you make to your home like converting your personal office into a bedroom for instance, you will need update your homeowners insurance.
Protect Against Natural Disasters
Have you paid off your mortgage? If you have paid off your mortgage, you cannot buy flood coverage from a mortgage company. If your loved ones are living in your basement and your area is prone to floods, you should obtain flood coverage.
Flood coverage will protect your loved one’s personal belongings as well as yours if you have any stored down in the basement. If your area announced that your house is a flood zone and you have paid off the mortgage before they declared it, you probably do not have flood insurance, as you did not have a need to get it, but you do now.
Protect Yourself Against Lawsuits
If you have your parents, grandparents, or adult children residing with you in your house, you need to obtain personal liability insurance. Their guests will come to the house as well. If one of them slips and falls or your dog bites them, you will find yourself facing a lawsuit if they decide to sue you.
If you have personal liability insurance, which you most likely do, as it is a part of your home insurance policy, you will protect yourself against potential lawsuits. Moreover, if your elderly loved one is living with you and they need a caregiver, you may also need to buy workers’ compensation insurance. However, this also depends on the state you reside in.
If you are thinking about asking your parents, grandparents, or adult children to come live with you, you need to evaluate your home insurance coverage. You can consider buying umbrella insurance coverage.
Umbrella Insurance Coverage: Here’s Why You Need to Consider It?
Umbrella insurance coverage can protect you in certain situations such as landlord liability, bodily injury liability, slander and libel, and property damage liability. Some of the instances that this type of coverage can protect you against include auto accident and a guest sustains an injury.
If you are thinking of evolving your household into a multi-generational household, add policies to your existing home insurance coverage or obtain umbrella insurance coverage.
Do your parents have the right insurance policy. Check in this article!
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