Before catastrophe strikes and you're faced with a loss, make a home inventory that includes lists, pictures or a videotape of the contents of your home. After all, would you be able to remember all the possessions you've accumulated over the years if they were destroyed by a fire, tornado, storm or other natural disaster? Having an up-to-date home inventory will help you get your insurance claim settled faster, verify losses for your income tax return and help you purchase the correct amount of insurance.
According to a survey from the National Association of Insurance Commissioners (NAIC), more than half of Americans don't have a home inventory of their possessions, putting them at risk for inadequate home insurance coverage, should severe weather strike.
- Close to half (44 percent) of homeowners have a home inventory, and the majority (54 percent)who do, have reviewed or updated it within the last year.
- One in 10 homeowners have not reviewed or updated their homeowners insurance policy in more than five years.
- Millennials are more likely to have reviewed/updated their insurance policy within the last five years, to have a home inventory and to have reviewed/updated their inventory within the last five years.
- Gen Xers (15 percent ) and baby boomers (15 percent) are significantly more likely than millennials (4 percent) to have reviewed or updated their policy more than five years ago
Start by making a list of your possessions, describing each item and noting where you bought it and its make and model. Clip to your list any sales receipts, purchase contracts, and appraisals.
Photos and videos offer easy ways to document your stuff. Most insurers offer free home inventory apps. Ask your insurance company about home inventory apps they provide that help take the guesswork out of creating documentation lists by walking you through each room and allowing you to download and add videos, photos, receipts and appraisals. This also allows you to store and back-up documentation and simplify claim filing.
- For major appliances and electronic equipment, record their serial numbers usually found on the back or bottom.
- For clothing, count the items you own by category pants, coats, shoes, for example - making notes about those that are especially valuable.
Don't be overwhelmed! If you are just setting up a household, starting an inventory list can be relatively simple. If you've been living in the same house for many years, however, the task of creating a list can be daunting. Still, it's better to have an incomplete inventory than nothing at all. Start with recent purchases and then try to remember what you can about older possessions.
Big ticket items: Valuable items like jewelry, art work and collectibles may have increased in value since you received them. Check with your agent to make sure that you have adequate insurance for these items. They may need to be insured separately.
Take a picture: Besides the list, you can take pictures of rooms and important individual items. On the back of the photos note what is shown, where you bought each item, and the make. Don't forget things that are in closets or drawers.
Videotape it: Walk through your house or apartment recording a video and describing the contents.
Use technology: Use apps or your computer to make your inventory list. Personal finance software packages often include a homeowners room-by-room inventory program. Check with your insurance company about what technology they provide. The National Association of Insurance Commissioners has a general inventory checklist and My Home App. https://www.insureuonline.org/home_inventory_checklist.pdf https://itunes.apple.com/app/myhome-scr-app-book/id414273863?mt=8
Storing the list, photos and tapes: Regardless of how you do it (written list, photos, video, Apps or computer software),keep your inventory along with receipts in a safe place off premises, Cloud, back-up or email it to family or friends. That way you'll be sure to have something to give your insurance representative if your home is damaged. When you make a significant purchase, add the information to your inventory while the details are fresh in your mind.
Creating Your Inventory
You can list your items by category, or by room. For many items like books, clothing, bed sheets or pots and pans, you can make a general estimate of how many you have. For expensive items, note the make and model, the store where the item was purchased and the approximate date.
Sample list: Living Room Inventory
||ABC Electronics, 2017
||Panasonic, srl # 1234567
||Antique Turkish 6' x 8'
||Anniversery gift 2009
||ABC Electronics, 2018