The first time you apply for homeowner's insurance, the question takes you off guard; in fact, it almost makes you want to laugh: "What would you estimate to be the dollar worth of your personal possessions?"
You scan the room quickly, suppressing a snicker as you survey the old chipped table-turned-TV stand in the corner, the faded chair you inherited from your parents, the sofa with the pillow strategically placed over the cushion with the hole in it. And yet, it's an important question for reasons that extend beyond your homeowner's insurance application. We've all been told by our homeowners' insurance providers, our local police departments and security experts that we need to conduct an inventory of our personal possessions. And most of us put it off. We're busy, and creating an inventory is hovering near the bottom of our "to do" lists. Besides, where would you start? What's valuable, and what isn't? How would you guess the worth of your possessions, and just how thorough do you have to be?
First of all, it's important to stress why you should conduct a personal inventory of your possessions. In the event that you suffer a loss - from fire, water, Mother Nature (a tornado or hurricane, for example) - your ensuing stress will be greatly reduced if you've taken the time to conduct an adequate inventory long before disaster strikes. Consider the stress you face immediately following a disaster. Your insurance company asks you for specific details concerning the possessions you lost. If your home is a total loss, how would you begin to attempt to compile a thorough list of those possessions, especially in your frame of mind?
Having an accurate inventory will help speed up the process of filing and processing your claim. The bottom line is that you'll be compensated much faster if you have documentation that allows your insurance company to determine an accurate estimate for your losses.
The easiest way to begin your inventory is to create a chart with the categories listed below. Make multiple copies of the chart, using one chart per room.
Your categories should be the item, the approximate date/year of purchase, their approximate price at the time of purchase, and their estimated value now. These will be very "ballpark" estimates, of course, but you'll want to give this project careful consideration. Don't shortchange yourself, but don't exaggerate, either. If you're a compulsive receipt-saver, you're in luck, since you'll be able to look up your expenditures and record each price to the letter. If you simply can't remember how much you spent on any given item, leave it blank, and come back to it later.
Your possessions of "value" are the ones you're concerned with as you walk from room to room. You don't have to record every last item in your house; it would probably take you years to accomplish that feat. What's "chart-worthy," and what isn't, then? The most obvious priority items on your list, of course, will be such possessions as jewelry; fine China, crystal and tableware; heirlooms; artwork; and electronics. But your home also contains a multitude of items - some of which nearly everyone homeowner possesses regardless of his/her budget - which you probably wouldn't remember to put on your list.
Those forgotten-yet-valuable items include:
Your first attempt at a home inventory probably won't be complete; you'll undoubtedly remember additional items later that you need to add to your lists, so leave yourself room to do so, and make plenty of extra copies of your empty charts for that purpose. And speaking of copies, you'd be wise to make a few photocopies of your completed charts for your records, and store one complete set in a safe.
In an upcoming article, we'll discuss more ways to protect your possessions, particularly in the event of theft.