We have all been spending a lot more time at home in the past couple of months and it has given many of us a chance to do some much-needed reorganizing, redecorating, and possibly remodeling. Whether you are an owner or a renter, it is important that you have the proper insurance coverage to protect your assets and the hard work that you have put in to creating a home full of things that are useful, valuable, and meaningful to you.
We all put a lot of time and effort into creating a home environment that serves our needs but, we do not often think about the reality of losing some or all of what we have created. It is hard to think about the possibility of experiencing a loss or damage to our property, so we often put it off.
If you were to suffer a loss in your home due to a theft, fire, or natural disaster, would you have the proper documentation to prove your losses?
Many of us fail to take the simple step of creating a home inventory for insurance purposes. A home inventory can make the process of filing a claim faster and easier. We all know that creating a detailed list of our possessions is important but, many of us would not know where to begin.
How will you record it?
- Photo – An easy way to get started on a home inventory is to walk around your home and take pictures of each room. Open drawers and cupboards and take pictures of the contents. Take pictures of your closet and medicine cabinet. Simply having photos of the items in your home can help you to remember and to prove what items you had before a loss.
- Video – Can be another good way to make an accounting of your home. You can take video of the different rooms in your house listing the items that you have. You can even state the year that you bought an item and the store that you bought it from. Again, this can be an easy way to get started and it will not take too much time or effort to get a comprehensive list.
- App – As with most things in our lives these days, there is an app for that. There are several home inventory apps that make it easy to track and manage all your household items. Of course, they all vary in price and functionality but, with the sheer volume of apps, there is one that is right for everyone. Do your research to find an app that has the features that you need at a price that you can afford. It is also important to research the security settings of the app to. Then, enjoy the convenience and peace of mind that come with keeping your home inventory in one safe, easy to access location.
- Spreadsheet – There is a lot to be said for keeping a simple spreadsheet of your home inventory. Creating your own spreadsheet allows you to customize fields and create a document that exactly fits your needs. You can keep track of things such as the date and place an item was purchased, purchase price, serial number, etc. The best part is, you can use a computer program that you already have and are comfortable with or even use a notepad and paper so you will not need to learn new software.
Where to begin?
- Latest additions and purchases – One of the hardest parts of creating a home inventory can often be deciding where to begin. A simple place to start is with recent purchases. It should be easy to track the purchase date, location, and cost with these new purchases. Additionally, you can get pictures of them in mint condition.
- Room by room – Once you have tracked your new purchases, you can go through your house room by room cataloging items. If you experience a loss that only impacts one or two rooms in your house, you can simply pull the inventory from those rooms making it easier to track the items that may have been lost or damaged.
- Big ticket items first – Most of us would not be too concerned about losing the stained Tupperware that was bought 10 years ago. However, you might be terribly upset if you were unable to prove that you had replaced all your kitchen appliances with top of the line models a few years ago. It can be beneficial to start your inventory with things that you would most want insurance help replacing (electronics, artwork, jewelry, appliances, furniture, etc.). Start with these items and then tackle the smaller, less significant items.
- Category grouping – It might be easier and make more sense to you to tackle your inventory by category. You could start with all the electronics in the home then move to other categories such as appliances, furniture, jewelry, clothing, hygiene and cosmetics, art, collectibles, etc. If this is the way you think about your belongings, it might be much easier to create your inventory using this method.
Where to put it when I am done?
- Paper copy – Whether it is a bulleted list or a detailed document, it is a good idea to have the paper copy of your home inventory stored in a fire safe, safe deposit box, or some other safe location.
- Digital Copy – It is good to have a digital folder that contains all photos, videos, spreadsheets, receipts, and all other supporting documents needed for your complete home inventory so it will be easy to access everything if you should need it. It is even better if this storage is cloud based so you will still be able to gain access even if your hard drive is lost or damaged.
- Back up files – Whatever methods you use to create and/or store your home inventory, it is important to create at least one back up file. If you have a paper copy, store a digital version somewhere as well. If you store your inventory digitally, print a copy and put it in your fireproof safe. All our clients can store a copy in the digital vault of their Wealth Plan. It is wise to have a few different ways to access your inventory in case your other methods are inaccessible.
- Check with your insurance agent – Once you have updated your home inventory it is good to share the information with your insurance agent so you can be sure that you have enough coverage. If you have jewelry, artwork, or other highly valuable items, you may need additional coverage specifically for those items. You should review your insurance coverage every year or so to ensure that you are fully covered and getting the best rate possible.
- Keep it up to date – When you go to the trouble to create a complete home inventory, it is important to keep it up. When you get new items and get rid of old items, update your inventory to reflect the changes.
Creating a home inventory, keeping it up to date, and regularly reviewing your insurance coverage will help to ensure that you are prepared in the event of a loss. No one wants to go through the loss or damage to personal property but, those who have prepared will have a much easier time receiving compensation. While it cannot always bring back treasured possessions that have been lost, it can make it easier to start over.
If you would like to discuss more ways to protect your assets and ways to store your home inventory in your Wealth Plan, please give us a call and we can discuss ways that we can help.
For more information about insurance or creating a home inventory please visit https://www.iii.org/article/how-create-home-inventory
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All investing involves risk including loss of principal. No strategy assures success or protects against a loss.