5 Steps to Create a Home Inventory for Insurance Protection

Do you have an up-to-date home inventory? If not, you’re not alone: According to a 2023 Insurance Information Institute (III)/Munich Re Consumer Survey, only 47% of homeowners reported having such an inventory. All homeowners should have this important tool, for two reasons. 

First, a complete, up-to-date inventory will help you determine the correct amount of insurance coverage you need. A current inventory will also pinpoint the need for additional insurance riders to cover items excluded from your homeowner policy.

Second, in the event of a theft, fire or other disaster, having an accurate list will not only make it easier to report your losses, but also help make your case with the insurance company about a fair settlement.

Relying on Memory Alone Can Hurt Your Insurance Claim

Could you name every item in your home, when and where you purchased it, and what it would cost to replace it? Could you name every item in one room of your home? Have you ever searched for something in a closet, cabinet, basement or attic and discovered things you’d forgotten about? These are some of the reasons why having an up-to-date inventory of everything in your home is so important.

Another reason is that supporting your claim will be difficult without photos, receipts or other documentation. Does your family room have a $500 sofa from a discount store or a high-end designer piece that cost 10 times that amount? If your house burns down, the charred remains of that sofa might not support your claim.

5 Steps to Producing a Home Inventory

These five steps will guide you through the often-daunting process of setting up a home inventory.

Room-by-Room: How to Document Your Belongings

Make a list of each room of your house, and jot down what furniture and other possessions are in each. Walk through the house. Tackle one or two rooms per day, and you should have a complete inventory in a week. Record the following information:

• Description
• Estimated value
• Purchase date
• Serial number (if applicable)
• Receipts and appraisals (if available)

Consider scanning any official documentation that shows proof of value, such as receipts or credit card statements.

Take Photos or Videos for Proof of Ownership

Take photos or video of every room, opening closets, cabinets and drawers to capture what’s inside. This type of record can be especially useful for items like clothing or kitchenware. (Note: You don’t have to inventory every single item. A photo of your pantry will likely be all your insurer needs to approve a bulk claim, such as “contents of pantry, $300.” No need to itemize each box of cereal.)

Another option is to use an app. There are dozens of home inventory apps for Apple and Android phones. Take advantage of free trials and read the reviews: some are particularly well suited to people with large collections or especially valuable items.

Safely Store and Update Your Home Inventory

Safeguard this document against the same types of loss that spurred its creation. Store your home inventory in a fire-proof safe or, better yet, in a safe deposit box. Also, consider keeping a digital copy of your inventory in cloud-based storage, so you can retrieve it from anywhere. The best practice is to have multiple copies, either physical or digital, stored in multiple places.

Discuss Big-Ticket Items with Your Insurance Agent

Valuable items like jewelry, furs, silver and artwork may have increased in value since their purchase date. Also, homeowners’ policies generally limit the amount of coverage on such items. You may want to purchase additional protection in the form of Personal Article Floater policies.

Include Off-Site Storage in Your Inventory

If you have belongings in a separate storage facility, don’t forget to include them in your inventory as well. These items should also be covered in your homeowner’s policy, provided you have the right amount of coverage. This also applies to possessions you store in your car, which typically fall under homeowner’s or renter’s insurance, not auto insurance.

And here’s one big DON’T . . .

Don’t Commit Insurance Fraud

Some people have the mistaken impression that their insurance company will lowball them on a claim, so they add “extra” to their inventory list to compensate. That’s fraud.

Next Steps: Review and Update Your Home Inventory for Optimal Protection

After investing the time to create a home inventory, you’ll want to gain the maximum benefits from your efforts.

• Review with your broker. Once a year, or whenever your homeowner’s policy renews, review the inventory with your insurance broker. He or she can help make sure you have the right protection for your belongings.
• Update your inventory. Any time you make a major purchase, add the item to your inventory while you have all the information at hand. At a minimum, update your inventory once a year. This annual exercise is also a good time to delete any items that you no longer own.

If you have any questions about these tips or your homeowner’s insurance policy, or if you would like a free insurance review, please call us at 877-576-5200.