Question 1

Why is a Personal Property Inventory List Important?

Accepted Answer

As with anything, it is helpful to understand just why you are doing it. When it comes to your homeowner policy, the majority of your personal property is covered on line item “C”. This typically is calculated as 70% of the dwelling limit on your policy. In other words, if your Dwelling is insured for $300,000, you will have a $210,000 limit for your personal property in the home. If you don’t have an inventory list and your home sustains a total loss, you will be required to work with an adjuster to determine the personal property lost so that a replacement cost for those items can be determined. You might ask yourself, “why, given this “automatic” coverage, do I need to compile an inventory list?” That’s a good question! There are multiple reasons as to why establishing a personal property inventory is in your best interest.

Reduces Stress and Speeds up the Claims Process

First, if your home is lost in a devastating fire, your life will be in plenty of disarray. Even with the best insurance coverage, this will be the case. One thing that will speed up the loss adjustment process and get rebuilding on track is being able to quickly calculate the loss amount and settle the claim efficiently. Without a personal property inventory, this task becomes much more labor-intensive. You will have a lot of things going on, and trying to remember all of the personal items that you lost will be difficult at the time of loss. It is also very easy to forget items that were completely destroyed in the loss. Making an inventory list makes both of these things much easier!

Makes Sure You Are Fully Reimbursed for the Loss

When you have a personal property inventory list, you can simply provide the list to the adjuster, who will no doubt be very thankful for your organization, and move on to putting the pieces of your life back together. Plus, you will ensure that you receive a full settlement payment that is precisely representative of the actual amount of property you lost. Many homeowners are surprised by the amount of personal property they actually have in their home and what sounds like a lot of coverage is quickly realized to be an insufficient limit! With an inventory list, you can make sure everything is accounted for and that there is enough coverage.

Ensures You Have the Right Types of Coverage

Taking inventory of your personal property items will ensure that you are covering the property in the right ways. Exclusions and limitations exist in homeowner policy language. By taking an inventory and providing it to your independent insurance agent, they will be able to explain any sub-limits that are present on your policy for specific types of items. For instance, your homeowner policy may limit jewelry losses by theft or mysterious disappearance to just $2,500. If you have a $10,000 engagement ring and wedding band that is not specifically scheduled on your policy, you are walking around with a potential out of pocket loss of $7,500 if your spouse lost a diamond because it fell out of a ring setting! Personal property inventory lists can help you decipher what is covered by line item “C” on your policy and what you should be scheduling for additional coverage.

Question 2

What Do I Need to List on My Personal Property Inventory List?

Accepted Answer

The answer likely will not be the same for everyone, but generally speaking, you should list all your “large-ticket” items. Expensive pieces of furniture, antiques, artwork, fine china, silver, jewelry, cash, firearms, etc. should all be listed individually. This way your independent agent will know what property items you have that may be required to be scheduled in order to receive a full loss payment in the event of a theft. 
Since there may be several new items added during the holidays, it’s just one more reason why this time of year is a great opportunity to keep personal property lists up-to-date. You don’t need to list every piece of clothing or every toy that you own, but you should categorize these items into a general column and try to calculate a realistic and honest replacement value for them.

Question 3

How Do I Make a Personal Property Inventory List?

Accepted Answer

The best way to go about creating an inventory is by downloading a spreadsheet and keeping the file electronically. Paper documents get lost and are harder to update. If you do wish to make a hard-copy list, be sure to scan a copy into your computer once you are done. The advantage of writing the list out on paper is that you can walk around your home and ensure that you don’t miss any items. However, digital copies are still a must. 
Save your list on a remote drive, such as Dropbox or Google Drive, so that it can be accessed from a computer even if your home computer is lost in a fire or becomes inoperable. If this is not an option, make an additional paper copy and store it at a trusted relative’s house or, better yet, a security deposit box at the bank. Having a list is only as valuable as your ability to produce it after an unforeseen loss occurs, so be sure that you take the care and due diligence to create the appropriate back-up copies in one way or another!

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