Do you have enough homeowner’s insurance?
Everyone has some possessions they consider irreplaceable – be it family heirlooms or photographs, jewelry, memorabilia, financial documents, and other valuables. But the items you use every day are just as valuable when you are considering your homer’s insurance and your estate plan.
It’s better to protect yourself now and document your possessions rather than trying to do it after something has happened. A home inventory will give you an accurate recording of your assets for insurance purposes and give you a better idea of how much homeowner’s insurance you need to ensure proper coverage.
How to do a Home Inventory
There are a number of ways to document your possessions, so you’ll need to find what works for you and then discuss your decision with your insurance company to make sure they feel it’s the best way. Here are a few suggestions for you to consider.
Tip: Don’t forget to document everything! The items you use on a daily basis are probably more valuable than you think. Imagine having to replace your furniture, dishes, silverware, clothing, bed linens, your books, CDs, DVDs, etc. The items you use everyday would probably cost more to replace than the items you think of first, such as electronics, jewelry, art, etc.
1. Video Tape Home Inventory
When you video tape your entire home, you’ll show everything you have so it proves what’s in your home. The best way to do this is to start at one end of your home and work to the other end. Speak to the camera while you video explaining each thing you look at so the insurance company knows what you’re talking about.
This video doesn’t need to be professionally done; your home video recorder will work perfectly. All you need to do is walk around your home and take video of the important things that are covered in your home insurance policy. Make sure you include the garage and any other buildings on your property that are listed in your home owner’s policy.
2. Home Inventory with Photos
When you document your possessions for insurance purposes, photos work well. You’ll need to take clear pictures of everything you want covered. When you print them out, document where the item is in your home and what it is, if it’s not obvious from the photo.
As with videos, you don’t need professional photos. Your digital camera will work just fine for the needs of your insurance company. The most important thing is that you take the pictures close enough to see what the item is and where it’s located in your home.
3. Home Inventory via Documentation
This process is similar to creating a financial inventory: start by writing down everything you want insured. Document where the item is in your home, and what it is. Include serial numbers and model numbers if applicable. You can then give a copy of the sheet to your insurance agent.
It is probably a good idea to document your possessions in conjunction with the video or photo documentation, that way you have a listing of serial numbers, model numbers, and other specific information that will be helpful in filing a claim.
Free online home documentation software. You can get a free online home documentation software program from KnowYourStuff.org, which is sponsored by the Insurance Information Institute. The software will help you do a room-by-room inventory of your personal belongings.
4. Documenting One of a Kind Items and Other Valuables
You may wish to get a professional appraisal for jewelry, artwork, antiques, memorabilia, and other one-of-a-kind or hard to replace valuables. Be sure check your homeowner’s insurance policy for limits on single items and take out a rider on these items if necessary (for example, my wife and I took out a rider for her wedding ring).
Tip: Get homeowner’s insurance rate quotes at least once per year to ensure you are getting the best value for your needs. Be sure to include any riders for valuable property in your homeowner’s insurance quotes.
5. Where and How to Store Your Home Inventory
Your home inventory doesn’t do you any good if it is in your house and it is stolen, burned, damaged by flood waters, or otherwise destroyed. You should consider keeping a copy in a safe deposit box if you have one, with a relative or close friend, with your insurance agent if they keep copies for customers, or uploaded to an online file storage service like Mozy or Carbonite. If you have a fireproof safe, keep a copy of your documentation in there for safe keeping.
Better safe than sorry!
You never know when something bad may happen, so it’s better to be protected. The suggestions above will help you to learn how to document your possessions for insurance purposes so your items will be protected if something were to happen.
This information will also give you insight into how much homeowners insurance you should buy, make it easier and quicker to settle a homeowners insurance claim, and make it easier to substantiate any losses for tax reasons.