We take precautions by purchasing a home insurance policy, installing smoke detectors, building strong windows, and checking our pipes. But, when it comes to documenting our home items, we aren’t as prepared as we should be.
The fact is the items in our home are all valuable in some way, whether it’s jewelry, photographs, clothes, furniture, or financial documents. The best plan of action to protect your home inside and out is to create a home inventory of all your belongings.
Obtaining a comprehensive home inventory:
- Ensures you have the necessary amount of insurance coverage.
- Identifies items that have limited coverage. You can then decide to purchase additional coverage to insure items for their full value.
- Allows an evaluation on whether to insure your property and contents at “replacement cost” or “actual cash value.”
- Results in a higher appraisal for your home, since it documents and provides proof of home improvement projects, which add value to your home.
- Verifies the condition of your assets before moving or placing them in storage in case of loss or damage.
There are five main ways to document what’s in your home.
Start room by room
Documenting your belongings may seem like a daunting task, but it doesn’t have to be. The best way to do this is to start at one end of your home and work to the other end. Go room by room. When you’re finished, go to your garage and then move to the exterior of your home.
Video your belongings
Creating a video of your entire home provides proof that the belongings are part of your residence. Speak to the camera while you video everything, so the insurance company knows which items you are documenting. Make sure you include the garage and any other buildings on your property that are listed in your homeowner’s policy.
Take photographs
Photographing your items is another way to document your possessions for insurance purposes. Take clear pictures of everything you want to be covered. When you print them out, document what the item is and where it can be found in your home.
Create a written list
This process is similar to creating a financial inventory: start by writing down everything you want to be insured. List 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 to your insurance agent.
Know when to bring in a professional
If you own one-of-a-kind or irreplaceable items, it’s best to bring in a professional appraiser or hire a reputable company to compile a home inventory for you. A third party brings credibility, saves time, and can provide the most accurate accounting of your personal items.
Finally, remember an insurance claim requires a detailed list of all the items destroyed, damaged, or stolen. Proper documentation ensures a faster and smoother claims process. It will also maximize your insurance reimbursement.
In fact, you must provide documented proof of ownership to receive a settlement covering the full extent of the loss. According to the National Association of Public Insurance Adjusters, most policyholders do not realize that the burden of proof rests with them.
Whatever documentation you gather, whether by yourself or through a professional, you should keep copies in a safe deposit box, with a relative or close friend, with your insurance agent, or upload it to an online file storage service like DropBox, Google Drive, Apple iCloud, or Microsoft OneDrive. If you have a fireproof safe, keep a copy of your documentation there for safekeeping.
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