Let’s try a little exercise: Can you list everything you own from memory? Didn’t think so.
The fact is most people own more things than they realize. It’s easy to remember the cars, the computer, the TV. But what about that holiday china in the garage? Or every pair of shoes?
All of it is regarded as personal property for insurance purposes. And if your home is destroyed by fire or some other disaster, having a list of your possessions makes filing a claim easier — and helps you put your life back together.
Why should I complete a home inventory? What’s the best way?
Comparing the value of your belongings to the “contents” limit listed in your policy helps you make sure you have enough insurance to replace them if they are lost, stolen or destroyed as a result of a covered loss. The easiest way to take an inventory is to use a video camera, recording and describing items as you walk through your house. Or, you can use a regular camera and create a home inventory checklist.
Here are a few tips for completing and storing your inventory:
· Add brand names and descriptions where you can, especially on large-ticket items. Serial numbers are helpful to note.
· Keep any receipts you have with the list to make the claims process easier. You may not be in the habit of keeping receipts, but here’s a new reason to start: Some insurance companies may expect a proof of purchase for big-ticket items like electronics, furniture, jewelry and tools.
· Store your video or photo inventory offsite so you won’t lose it if your house is damaged.
· Update your personal property records when you purchase new furnishings and valuables. Though the task may seem daunting, it’s important to try. An incomplete inventory is better than nothing at all.
How much insurance do I need?
We can assist you in analyzing your insurance needs and help you decide how to most effectively protect your personal property. You should consider full-value coverage, which will pay for the replacement value of your personal belongings. A standard policy typically covers personal property only up to its actual cash value, determined by taking the replacement cost and deducting depreciation, which can be substantial. (For example, a 5-year-old TV is usually worth much less than what it would cost to purchase a new one.)
Finally, remember your homeowners policy covers valuable items such as jewelry, furs, art and antiques, only up to set dollar amounts. If the cost of replacing them exceeds these limits, you may want to purchase scheduled personal property coverage.
The Insurance Information Institute has a FREE online tool that can help you create your inventory. Just visit www.knowyourstuff.org for more details.