Paying for property insurance can sometimes feel futile, especially if you’ve never had to file a claim. However, recent disasters that have destroyed or significantly damaged homes, such as in western North Carolina and Southern California, show how quickly and unexpectedly you could need that insurance coverage. It’s also crucial to have optimal coverage and endorsements for protecting your financial security.
While homeowners insurance policies typically cover losses from fire, wind, and hail, separate policies may be needed for hurricane and earthquake damage. More than 100,000 homes were damaged or destroyed in North Carolina due to Hurricane Helene in 2024, it was estimated.1 Most of the shocking amount of destruction was due to flooding. Sadly, only around 3% of homeowners in North Carolina had flood insurance.2
In January 2025, nearly 13,000 households were impacted by the devastating Palisades and Eaton fires in the Los Angeles area.3 It’s estimated that around 75% of homeowners don’t have policies with enough coverage for losses and, of those, 36% have less than 75% of their home’s replacement cost covered.4 This means that with the average value of an Altadena home being $1.4 million, if a homeowner lost their property in the Eaton fire and had only 75% coverage, it might cost them about $350,000 to rebuild.5 There’s a difference between a home’s market value vs. its replacement cost.
Determining which type of insurance you need and how much can be difficult to navigate. Property and casualty (P&C) insurance are often bundled in a policy to help protect your physical assets as well as provide liability protection. Here’s a breakdown of the main points to know when considering P&C insurance.
P&C insurance definition
Property insurance covers damage to or loss of your physical property, such as your home, car, or personal belongings. This can include damage from disasters, theft, vandalism, or accidents. Separately, casualty, commonly known as umbrella insurance provides liability coverage, protecting you if you’re held responsible for injuries or damage to other people or their property. For instance, let’s say you had a houseguest who was injured when the wind blew in a window. The property insurance would be for covering your house damage; the casualty insurance would be for protecting your finances from legal liability due to your houseguest’s injuries.
Types of P&C insurance
Multiple and varied types of insurance are included in the broad category of P&C coverage. These are some of the commonly known and key policies to consider:
- Homeowners: Covers your home and its contents. It typically includes protection against fire, smoke, wind, hail, and theft, but often excludes floods, hurricanes, and earthquakes which may require separate policies. Your home financing lender likely requires that you have homeowners insurance, with limits varying by lender and state.
- Disaster: Some states or high-risk areas might require insurance such as hurricane, flood, earthquake, or wind. If you live in a disaster-prone area where insurance isn’t required, it’s worth considering getting a policy.
- Renters: Protects your personal belongings within a rented property and can provide liability coverage if you are found responsible for damages.
- Condo: Your condominium or homeowners association may cover the building in which you reside, but it won’t cover losses or damage that occur inside. Sometimes overlooked, this insurance could be worthwhile.
- Landlord: A homeowners policy won’t typically cover a home that’s being leased, so review your policy to determine if you need additional coverage when renting out a house.
- Umbrella: Offers additional liability coverage beyond the limits of your homeowners, auto, or renters policies for protection from lawsuits, creditors, property damage, and injuries. If you have significant assets, consider hosting parties, having doggy play dates, or having a pool, this might be beneficial to you.
- Auto: Covers damage to your vehicle and liability for injuries or damage you cause to others while driving. Also consider insurance for boats, RVs, ATVs, and other vehicles that may come with risk.
- Commercial: If you are a business owner or own commercial property, this coverage is important for damage, loss, and liability. Texas does not require businesses to purchases workers’ compensation coverage so you may need to get a separate policy for this protection.
Choosing your P&C insurance coverage
Obtaining the optimal P&C insurance policies and coverage amounts can help you avoid significant out-of-pocket expenses in the event of a loss or liability claim. If these expenses would impact your financial stability, it may be worth considering updating your current policies or purchasing additional coverage. Money matters can cause worry and stress, but knowing you’re adequately covered can ease anxiety before those issues become serious. Additionally, keep in mind that some types of P&C insurance, such as auto or disaster insurance, are legally required in many states.
Remember to review your policies when you experience major life events, such as buying a new home, getting married, or having a child. Regularly check your coverage at renewal time to ensure it still meets your needs and to compare rates.
Take action
Insurance is a critical — and sometimes overlooked — component of a unified and integrated financial plan. That’s why we make it integral to our end-to-end wealth management approach. We work with a range of prominent national insurance carriers without bias, so our insurance solution specialists always think strategically and put your best interests first.
If you are a Mercer Advisors client and want more information about how our insurance solutions can benefit your personalized financial plan, contact your wealth advisor.
Not a Mercer Advisors client and are interested in how to navigate P&C policies, especially as they relate to protecting your wealth accumulation? We provide insurance advice and solutions as part of a comprehensive financial plan, along with investment management, tax planning, estate planning, and more. When you’re ready to amplify and simplify your financial life, let’s talk.
1 “200,000 people impacted by Helene housing damages; many struggling to find homes.” WLOS TV, 8 Nov. 2024.
2 “97% Of NC Homeowners Don’t Have Flood Insurance.” WCCB TV, 8 Oct. 2024.
3 “California’s insurance crisis leaves neighbors facing unequal recovery after wildfires.” AP News, 5 Feb. 2025.
4 “Three-fourths of homeowners may not have enough insurance to fully cover losses after a disaster, study says.” Fortune, 11 Jan. 2025.
5 “New analysis of LA fires reveals property damages top $30 billion.” CoStar, 30 Jan. 2025.
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Mercer Global Advisors has a related insurance agency. Mercer Advisors Insurance Services, LLC (MAIS) is a wholly owned subsidiary of Mercer Advisors Inc. MAIS provides individual life, disability, long term care coverage, and property and casualty coverage through various insurance companies. For Mercer Global Advisors clients who wish to purchase insurance products, MAIS has entered into a non-exclusive referral agreement with Strategic Partner(s), where the Strategic Partner will provide necessary services relative to the marketing, placement, and servicing of the insurance products, including without limitation preparing and presenting illustrations, supporting the underwriting process, assisting with the completion and execution of applications, delivering policies, and servicing in-force business. MAIS and the Strategic Partner will be listed as either “agents” or “co-agents” on the policies. While Mercer Global Advisors does not receive a referral fee, Strategic Partner receives a percentage of the commission revenue. MAIS and Strategic Partner do have a revenue sharing agreement.
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