Creating a Household Inventory for Insurance
Tuesday, November 18, 2014
It can happen when you least expect it. A flood deluges entire neighbourhoods. A fire tears through a block of houses. A thief steals your antique collectibles or valuable jewellery.
For those unfortunate events, the majority of people have home or tenant’s insurance to cover the loss. However, many are not able to maximize their home insurance because they don't have proper documentation or an inventory of household items.
A home inventory is a list of your household items and assets. It can help you determine the actual amount of insurance coverage you need. In the event of an emergency, a household inventory can maximize the return you will receive from insurance. It is much easier to document items you have in your home now than trying to remember what was once there in the wake of a disaster.
How to create a household inventory
Creating a household inventory is not necessarily quick and easy, but it can be done in a very efficient way. Here are some smart tips.
Tip #1: Document what you own
One of the easiest ways to document your items is to take a video of your contents. Start in one room and slowly make your way through the rest of the house. As you go, mention specific items that stand out or are of high value and importance. The video does not need to be professional quality. It can be done on any camcorder, camera or smart phone.
Along with the video, taking digital pictures of the items individually will help the insurance adjustor identify certain makes and models of items like televisions, appliances and power tools, and their current condition. It is important to get pictures of any serial numbers or codes pertaining to the items. If you are robbed, police can track items by serial numbers in the event the thief attempts to sell the stolen items.
Create a spreadsheet or list that contains all the items in your household from clothing, appliances, dishes, cookware, children’s toys and jewellery. This should include the quantity, colour, serial number, size and brand of each item. It is important to be as detailed as possible in this process, especially for the higher valued items4 so it is easier for the adjustor to see what you have actually lost.
By documenting your household items in these forms, you are able to prove that you did own the items listed on your insurance claim.
Tip #2: Retain your receipts and appraisal values
In the event of a disaster, your insurance adjustor will ask for specifics when it comes to the lost and/or destroyed items. While adjustors are not in the business of disbelieving clients, there may be a level of doubt when it comes to value of certain items.
You should be able to prove to the adjustor that the vacuum you purchased was of a certain value and not bought at a flea market, or that the Hermès luggage is authentic. If you have the receipts of valuable items, there can be no doubt.
Jewellery is often among the most expensive items in a household. However, the real value can fluctuate and there is always the question of authenticity. Get your jewellery appraised and keep a copy with your other receipts. A professional appraisal can also be done on artwork, antiques or one-of-a-kind items.
Tip #3: Store the documents in a disaster-safe form
After going through the effort of taking video and pictures of your household items and documenting them in a spreadsheet, it would be unfortunate to lose that information in a disaster. There are a number of options to download or save your important documentation on online file storage sites such as DropBox.com. Or keep everything on an external hard drive and off the property or in a fireproof safe. It is also important to store your receipt copies and files in the same manner. Some people store their household inventory in a safety deposit box.
Tip #4: Choosing the right coverage
Once you have determined what inventory you have in your household, it’s a good idea to sit down with your insurance broker and determine the right type and amount of coverage for you. Certain policies will only cover a specific amount of loss, and if the total value of your items is over that limit, then your insurance coverage is insufficient. These limits can also exist on certain individual items like jewellery. In certain circumstances, you may need to increase your insurance or take out a rider on those items.
Some things just can’t be replaced. But should disaster strike, you’ll be glad that you took the time to compile a household inventory.