It’s a tragic picture that’s repeated much too often: A family finds itself on the street, staring shell-shocked at the smoldering ruins of their home, or trying to pick their way through the wreckage after a tornado rampages through their town. What follows is a seemingly endless and gut-wrenching process that can take months or even years as the family tries to regain some sense of normalcy.
In the aftermath of such a calamity, there are a lot of decisions to make and things to do. Homeowners’ insurance is designed to take the brunt of losses and help you get your life back, but most homeowners are ill-prepared to deal with the inevitable question raised by your insurance adjuster: “Do you have a home inventory?”
Simply put, a home inventory is an itemized list (the more detailed, the better) of your home’s contents. Using photos, videos and supporting documents can speed up the claims process. And technology such as smartphones can make the process much easier, but most of us are just not taking the time and effort to do it.
In 2012, the National Association of Insurance Commissioners announced the results of a study that found that only about four in 10 Americans had even attempted to compile a home inventory. That’s probably because it seems like an overwhelming task for homeowners who have more possessions than ever.
The Insurance Information Institute says there are three good reasons to have a home inventory: It helps you purchase the right amount and type of insurance, makes filing a claim simpler, and helps substantiate losses for tax purposes and when applying for financial assistance.
“I tell my clients to think of it this way,” noted Allstate’s Mark Doiron of Madison, who urges all his clients to do a thorough home inventory. “Close your eyes and think about everything that’s in the room around you. Chances are, you are going to miss something. Now, think about trying to do the same thing when your home has just been destroyed.”
Of course, not having a home inventory doesn’t mean you won’t be able to file a successful claim, but it can make the process go much faster, noted Jason Hargraves, managing editor at insuranceQuotes.com. “The inventory is meant to make the process easier for you and the insurance company,” Hargraves told me. “Having to recall your items from memory after a loss can be stressful and you could easily forget something. Giving your adjuster a complete visual inventory also can speed up the process of a claim and serve as documentation for any potential disputes.”
Hargraves advised consumers not to be intimidated by the size of the task at hand, because the best tool to help is probably within your reach right now: your smartphone, which can take and store video. “Just aim, start recording and walk through your house,” he explained. “No special video equipment is required. Several apps are also available to make the process of using your smartphone for this even easier.”
Both Doiron and Hargraves advised consumers to keep receipts for as many items as possible, to document their value. Doiron added that’s especially necessary for any items valued at more than $1,000, such as jewelry, collections or artwork. Update the inventory often, and once you’ve created the record, it’s important to keep it (and supporting documentation) off-site yet accessible, such as in a safe-deposit box. Digital files can be stored in a cloud-based service such as Dropbox.
For more tips, visit the Insurance Information Institute at https://www.iii.org/article/how-create-home-inventory.