If you feel in a quandary when you look at your homeowner's insurance, take heart; you are not alone. In fact, a recent study conducted by Harris Interactive for Travelers Insurance shows that a large number of American homeowners are unsure of their coverage specifics. Many of these homeowners are underinsured and the smallest disaster could send them into a financial hardship.

The researchers questioned more than 1,300 homeowners to determine exactly what they knew about their coverage. They also asked the study participants how often they reviewed their policy to ensure they maintained appropriate coverage and how they conducted their review.  According to the survey data, more than 44 percent of those surveyed had not examined their insurance coverage in the past year. Some respondents had not reviewed their insurance policy in the last 10 years.

The "Travelers In-synch Homeowner's Insurance Study" also indicated that nearly 27 percent of these homeowners weren't sure whether their policy would cover the cost of rebuilding their home. Thirty-six percent didn't know whether their policy would cover damage caused by a hurricane. Forty-two percent were unsure if they had earthquake coverage. Twenty-six percent didn't know if they had coverage against flood damage, and 37 percent didn't know whether their policy would cover a prolonged hotel stay if their home were damaged.

Many items impact the amount of homeowner's coverage you need. That's why it is important to review your coverage frequently. Here are some criteria to use in your review:

·   Have you recently remodeled your home?
If you've improved your home, chances are you've increased its estimated replacement cost.

·   Has the inflation rate increased since your home was last appraised?
Certain conditions, such as severe weather, can increase the demand for labor and materials, which raises costs beyond the normal inflation level. It is important to update your coverage each year to account for changing inflation.

·   What factors influence building costs in your area?
Replacement costs are directly proportionate to factors, such as the availability of labor, the current demand for labor, and the cost of construction materials. Adjusting your coverage regularly can ensure your policy will provide the money you need to rebuild.

To determine whether you have adequate coverage you should know your home's estimated replacement cost. Keep in mind that your replacement cost could be higher or lower than your home's market value. You should also consider the building materials used to construct your home. The more difficult the building materials are to find, the higher your replacement cost. Your coverage needs to reflect these increased costs.

The best way to stay ahead of changing costs is to contact your insurance agent annually to discuss your current coverage and your changing needs. They can help you manage risk by updating your coverage so there won't be any surprises should your home be damaged.

Rocklin Homeowners Insurance, Roseville Homeowner's Insurance can be had for a really good rate and if done right can cover all the holes.