Paul Dreher Director of Personal Insurance View Bio

Thank you to our friends at International Risk Management Institute, Inc. who originally published this tip in the IRMI personal lines pilot. View IRMI’s website here: www.irmi.com

Catastrophes can strike at any time; thus, preparation and risk control are key risk management tools for homeowners. A home inventory is a necessary ingredient in this preparation. Insurance companies use these inventories in many ways, such as to account for insurable assets and in the subrogation process. And yet, a National Association of Insurance Commissioners’ survey indicated that nearly 60 percent of consumers lack a list or inventory of their possessions, putting them at risk for home insurance coverage gaps.

One of the easiest ways to create a home inventory is with your smartphone. Approximately 80 percent of Americans own a smartphone, with young adults ownership around 95 percent. So, spend an hour or 2 creating your home inventory. Your insurance agent, adjuster, and pocketbook will thank you should a property loss occur. The following are some useful tips in developing such an inventory.

  • Check out some of the free home inventory apps on your smartphone. Two apps with great reviews are the Insurance Information Institute’s Know Your Stuff app and Belongings Home Inventory app. These apps walk you through the process.
  • Use a smartphone app or your PC to make a list of your important possessions, including their make and model (if applicable), description, and estimated purchase price. On some programs, you can create the list by category or by room.
  • Some insurers often provide home inventory software on their website and/or via smartphone apps. For example, Allstate offers its Digital Locker. This free and easy to use application lets its policyholders create an inventory of their valuable home items and store the information (and digital photos) in the cloud.
  • Another option (on some apps) is to take a video of your possessions as you walk through your house (describing the items) and store the video in the cloud.
  • Big ticket items may have increased in value since you purchased them. Examples include diamond rings, works of art, collectibles, and wine collections. Contact your agent to ensure adequate protection is in place since special coverage may be needed. In some cases for very high-value items, your agent may ask for an updated appraisal.
  • A home inventory should be reevaluated and updated as needed on an annual basis.

 

©International Risk Management Institute, Inc. | www.irmi.com