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Multigenerational Homes and Insurance: What Happens When My Kids or Parents Move Back Home?

Family .

Has an older parent or adult child recently moved back home? If so, your household is a part of the growing trend toward multi-generational living. More than 57 million Americans now live in multi-generational homes, according to the Pew Research Center, which reports rapid growth in multi-generational housing for Americans over the last decade. This uptick in multi-generational living is especially pronounced for older Millennials. In addition to navigating a new set of family dynamics, your insurance needs have most likely changed.

Whether you’re welcoming your adult son or your elderly mother back into your home, your current insurance policies may not provide sufficient coverage- leaving you or a loved one vulnerable in the event of an accident or emergency. From adding an adult child to your auto insurance policy to updating you homeowner’s policy to cover your parent’s belongings, getting the right coverage today can save you from a future financial or legal nightmare. Talk to your agent about the following policies:

Adding Another Driver

First, you’ll need to decide whether you’ll be adding your adult child or parent to the policy. If your adult child or parent will be driving your car - even occasionally - it’s a good idea to add them to your policy. Otherwise, you may open yourself up to a liability risk in the event of an accident. Keep in mind that additional drivers may also mean an increase in your rate, especially if their driving record is less-than-stellar or they’re significantly older or younger. Generally policy rates tend to be lower for individuals aged 40 to 60. Also, consider whether it’s truly a good idea to have your adult parents on your policy. With your mom or dad moving in, now may be a good time to talk about whether they should continue driving, and if so, whether driving should be restricted to daylight hours or short trips to the store.

Protecting Your Loved Ones’ Property

Most homeowner’s policies provide coverage for approximately 50 to 75 percent of your home’s value, up to a set limit. It’s a good idea to re-evaluate coverage limits after a loved one moves in. You may need to buy a valuable-articles rider or scheduled personal property insurance to ensure adequate coverage. This is especially important if your parents move in with family heirlooms, jewelry, art, antiques or valuable furniture. Cash value policies may not cover antiques. If your parents have sold their house and discontinued their own homeowner’s or rental policy, these valuables may be left without any coverage.

While your adult children are less likely to move in with expensive jewelry or art, don’t discount the value of their electronics, as well as clothing, furniture and other personal items. Take inventory of the personal property in your home and talk to your agent about adjusting coverage levels.

Finally, if you’re undertaking a home renovation to customize existing living space or adding on a small addition for your parents, you’re likely increasing your home’s value. Structural changes, like converting an office into second master suite, may also require a policy update.

Paid Home Care

Will your loved one require paid home care? Ask your agent whether additional policies like umbrella liability coverage may be necessary to keep you, your family protected, and your parent’s nurse protected.

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