Protect your home, vehicles from inflationary effects with a policy review

BY ADAM CULLER

It’s no small secret—inflation is here to stay for the foreseeable future.

On top of inflation, lingering effects from the COVID-19 pandemic continue to cause supply chain and labor shortages, creating a frenzy among consumers for a limited inventory of homes and vehicles.

Due to these shortages, prices for new home construction and existing houses have soared, as have vehicle prices. In many cases inflation also has driven up the value of homeowners’ personal property.

Although Virginia Farm Bureau Mutual Insurance Co. products include automatic value increases at the time of policy renewals, it’s still advisable for homeowners to regularly review their policies and ensure they have adequate coverage.

“Meeting with your Farm Bureau agent will help make sure everything on your policy is where it needs to be value-wise in the event inflation affected the value of your property, whether it’s your home, automobile or anything else of value,” said Lisa Whitus, VFBMIC personal and commercial lines underwriting manager.

“These sit-downs really benefit the customer because agents can point out where the policyholder may have a shortage or a coverage gap and help them secure coverage that protects the full value of their property.”

Like new home construction, automobile production was down millions of vehicles in 2022 due to supply chain challenges.

Market research for 2022 reported new vehicle prices rose over 6% due to inflation and parts shortages, and a lowerthan-usual inventory of used vehicles led to prices surging by over 40%.

With consumers spending more on cars than usual, Whitus said customers should consider adding supplementary coverage to their auto policies to protect a vehicle’s full value.

“The financial investment being made by drivers has grown—in some cases exponentially,” Whitus said.

“Even though drivers are fetching great prices for their used vehicles, automobiles will still depreciate as they get older,” she added. “If you’re purchasing a car in the current market, you should be looking at obtaining coverage that will protect your vehicle’s value and your bank account.”

With Virginia Farm Bureau, auto insurance customers can opt for auto loan/lease payoff coverage and new vehicle replacement coverage, which provide additional protection for total losses.

Auto loan/lease payoff coverage is designed to cover the difference between the unpaid amount on a vehicle’s loan or lease and the actual cash value of the insured vehicle at the time of a covered loss. This coverage often is referred to as “gap insurance.”

The endorsement may be applied to any new, used or leased vehicle while a lienholder or leaseholder is listed on the auto policy, and vehicles must already be covered with collision and comprehensive coverages.

With new vehicle replacement coverage, customers who own new vehicles two model years or newer can have their vehicles replaced in the event of a covered total loss.

When a covered loss occurs, the endorsement pays the difference between the car’s value at the time of the loss and what it costs to purchase a new vehicle of the same make and model.

To qualify for the new vehicle replacement coverage, vehicles must already be insured with collision and comprehensive coverages and may not be previously owned or titled by another party. Additionally, the endorsement only pertains to a vehicle’s model year, not length of ownership.

Coverage is available to any new passenger and utility-type vehicles listed on the insured’s auto policy.

To learn more about home and auto insurance products, visit vafb.com/ insurance or call your local Farm Bureau agent.