Written by Suzanne Johnson
There is no time like the present to create a home inventory strategy. We can all find excuses to put off the task of going through our belongings and documenting what we own for insurance purposes. Maybe we’re waiting to really organize our closets and cupboards, or finally have that garage sale we’ve been talking about for years.
But should disaster strike, insurance companies require documentation for each item lost, along with its brand, age, and value, before they can reimburse the insured. Imagine the ordeal of trying to recreate your possessions from memory, room by room: clothing, furniture, kitchenware, linens, tools, bikes and skis…it would be a daunting challenge.
While it may seem like a chore that most of us are all too willing to postpone, taking the time now to assess and document possessions can bring the peace of mind of knowing that you are prepared and resilient in case the unexpected happens.
Three Ways Home Inventories Make a Difference
Whether a homeowner goes about the process by way of a photo collection, a video or a written list, home inventories serve multiple purposes, explained Jim Ignozzitto, Vice President, Insurance at AAA Oregon/Idaho. “The primary use is to expedite insurance claims, of course. That process goes much more smoothly with documentation. However, an inventory is useful before any disaster even happens, to know whether you’ve got the right coverage,” he said.
The process of creating a home inventory can highlight gaps in insurance coverage. A differential between what a person owns and what their insurance covers often happens over time. Growing families add sports gear, electronics and personal items that all add up; recent trends in home gyms and offices can involve expensive new equipment and furniture to consider. Unique artwork or jewelry may need an appraisal by an independent expert who can set the true value for insurance. With a current inventory in hand, homeowners can talk with their insurance agent to fit their coverage to their needs, in case of a major loss.
What about the items that are not totally covered by insurance? Home inventories can make a difference in these cases, too. When homes, vehicles or personal property have been damaged or destroyed, the losses may qualify as tax deductions. Only the amount that was not reimbursed by an insurance policy is considered. The home inventory serves as a backup for the claims listed on that year’s income tax form.
Start With a Home Inventory
The simplest way to begin is to walk through every room with a smartphone, taking photos or videos. Videos take just a few minutes to make: simply pan the room, while recording a spoken description of important items. Open closet doors and cabinet drawers to document the contents. Spend time working through every room—especially basements and garages, where gear like fishing rods, camping equipment and paddleboards reside. Upload the videos to the cloud or online storage instead of on the phone to protect against damage or device loss. This quick and easy method is helpful for renters and homeowners alike, especially before moving to a new location.
Videos are quick and comprehensive, but photos offer more detailed documentation. Insurance companies prefer photos of specific items—and isolating one image from a video can be a tedious job. Smartphone cameras can zoom in on serial numbers, brand names, artist signatures and other identifying marks used to establish replacement values. Photos also work well to digitize paper documents such as auto titles, health and vaccine records, diplomas and authenticity certificates for original art, which may be on the backside of a canvas, leaving them vulnerable to damage.
Taking inventories to the next level is easier with the help of apps that specifically track personal assets. Many home inventory apps offer easy templates for storing photos and purchase details. Some link to warranties and manuals, and some can track multiple properties or collections. Look for one that fits your needs, or one with a free trial option. Spreadsheet-savvy homeowners might skip the app and design their own system, with fields organized by room or by category. Like all home inventory records, just be sure it backs up to online storage.
Moving Forward with Confidence
Kick off the new year with a solid inventory strategy in place. You’ll be setting your family up for a confident—and adequately insured—2022 and beyond.
Tips for a home inventory
- Scan and save receipts as you acquire major items, ensuring that you document the date, location and cost of important purchases.
- Write down a description of each important item that you own, including brand name and serial number.
- Take a photo or video of important objects with a timestamp to prove their most recent condition to your insurance provider.
- For extremely rare or expensive items, record the most recent appraised value, the date of the appraisal, and the company or professional who conducted the appraisal.
- Keep important documents and passports in a fireproof home safe or a bank safety deposit box.
- Scan important documents and backup your data in the cloud or on a drive kept in a safe place.