Protect Valuables Before You Need Insurance

What to Do Before Disaster Strikes

Protect Valuables Before You Need Insurance
December 4, 2014

Dealing with the aftermath of a home-destroying disaster is bad enough without uncertainty regarding your insurance coverage and replacement costs. A full inventory of your possessions can accelerate the process of sufficiently replacing them and starting the recovery process.

Most of us have a scattering of files and information on our possessions, but not a complete and accessible inventory. Start by inventorying your items as you assess the best pre-emptive protection methods for your case.

Here are some hints to assist you in the process.

  • Avoid Procrastination – The couch is too comfortable. The game is on. You are tired. You will take care of it tomorrow. You don’t really believe that, do you?

    Sometimes the hardest part is getting started. Clear out a block of time and dive right in. You are likely to need more time than you think to do a full and correct inventory, so clear out successive days or weekends if you have to – but get started and build on your momentum.

  • Review Your Policy– If you are the average American, you probably do not know the details – and maybe even the basics – of your homeowner’s policy. Take the time to review your policy for the coverage amounts, exclusions, and any attached riders. This may help you spot concerns with your policy as you conduct your inventory.

  • Efficiently Inventory Your Possessions – Now it is time to get to work. Try to balance time with a thorough assessment.

    For example, trying to determine the value of every piece of clothing or pair of shoes in your closet is futile, but if you try to assess a blanket value, you will almost certainly guess low. Assume an average purchase price, take a percentage of that for use (perhaps 50%), and multiply that by the number of clothing items. Even at a 50% discount, you will be surprised at the number.

    Don’t forget the garage. You probably have more value in bikes, power tools, and other supplies and stored items than you realize.

  • Document Valuables Extensively – Record extra information on your most valuable items, such as the serial numbers on electronics. Pictures help, especially for heirlooms, jewelry, and items like condition-sensitive coins and collectibles – but if you have any other information such as appraisals or initial purchase prices/receipts, be sure to include them as well.

  • Consider Alternate Storage – If you have enough valuable and small items, perhaps renting a safe deposit box at your bank is worthwhile. A fireproof safe is another reasonable alternative.

  • Store Inventory Results Carefully – If you store the results of your inventory on your home computer or in a drawer and your home is destroyed; your inventory list is likely destroyed as well. You should have at least one copy of the inventory list in safe external storage – perhaps in the cloud, in a safe deposit box, or both.

  • Reassess Your Policy – Now that you have read your policy and reassessed all the valuables that you have to protect, do you have sufficient coverage? You may want to increase the coverage amount of your overall policy, or consider riders for specific valuable items.

Third-party home inventory services are available if you are just not up to the job or would rather pay the expense than spend the time.

It may not be fun, but inventorying your possessions is essential to make sure your homeowner’s insurance policy is sufficient and that your lost items are properly accounted for and documented. Do it now, or regret it later in case of disaster.

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