When it’s safe to shred insurance documents

Q. How long should we keep expired insurance policies for auto, home, and personal liability? We renew them every year. Is there any reason to keep the expired ones? If so, is it enough to keep just the declarations pages and toss the actual policies and endorsements?
— Trying to reduce clutter

A. We’re all for reducing paperwork, but of course there are documents you should be more careful with.

Although there are some financial documents that need to be kept from one year to the next— property and casualty insurance policies — those for home, auto and personal liability are not among them, said Claudia Mott, a certified financial planner with Epona Financial Solutions in Basking Ridge.

“When you receive your new policy, the previous year’s documents can be shredded,” Mott said. “You may choose to keep the entire policy, but the summary or `declarations’ page is what you must hold onto.”

She said your agent and the insurance company both maintain copies of client documents in the event you need to obtain the actual policy.

Mott said the exception to this would be any policy-related documents for which there is a claim in process or one that has been settled but might be reopened.

“Either you or an attorney may need to have copies of the documents that were in force at the time the claim was filed and it would be good to have them for reference,” She said.

With other insurance policies such as life, disability or long-term care, Mott said, it is important to keep all of the policy documents and any amendments until the policy expires or is cancelled.

Good luck with the clutter reduction!

Email your questions to ask@njmoneyhelp.com.

Karin Price Mueller writes the Bamboozled column for The Star-Ledger and she’s the founder of NJMoneyHelp.com. Click here to sign up for the NJMoneyHelp.com weekly e-newsletter. Like NJMoneyHelp.com on Facebook and follow it on Twitter. 

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