You have made sure your home itself is protected against a fire or other disasters, but what about the things inside it? Have you taken time to ensure you are covered for damage or loss of your furniture, fitness equipment, clothes, jewelry, electronics, cookware, and other belongings? As we kick off a new year, there is no better time than for a fresh start with your personal property coverage. Take time this month to review your coverage, update your home inventory, and make any changes necessary to better protect your family in the year to come.
Understanding Personal Property Coverage
Personal property coverage helps compensate you for the loss of your possessions when they are damaged, stolen, or destroyed due to a covered event. If you have a standard homeowners insurance policy, you already have personal property coverage listed under Coverage C of your policy. Unless you have customized your coverage, the limits are probably set by default at 50 percent of your total Coverage A limits, which is the amount your home itself is insured for. If you rent or own a condo, you were probably given the option to set your own personal property coverage limits.
So how do you know if you have enough protection?
Take Inventory of Your Home
Experts agree that taking an inventory of your personal property is a great first step to knowing whether or not you have adequate coverage. Unfortunately, few people keep an updated copy of their home’s contents and the things they own stored outside or away from the home. Considering you probably added several shiny new gifts to your household during the holiday season, this is a good time to either update your existing inventory or create one for the first time. While this may seem like a daunting task, it can help you better determine your coverage needs, as well as help you declare your losses after a fire or other covered event.
You could create your inventory manually with a list in Word or Excel for example, or you could download an app or select a cloud-based software program to help you store your inventory where you can safely access it from anywhere in the world. Then, begin listing items one room at a time, sorting them into categories like apparel, jewelry, electronics, etc. Finally, take pictures of all the purchase receipts you have for ‘big-ticket’ items, as well as photos or video of the items themselves. Record serial numbers, and make a point to update your inventory as you acquire additional items in the future.
Are You Fully Covered?
The question then becomes, “Are your personal belongings fully covered?” You can find out by adding up the total value of your belongings and comparing it to the limits of your policy. If you are covered for the actual cash value of your items (ACV), you will only be reimbursed for the depreciated value of your belongings. If you have a replacement value endorsement, which we recommend for nearly all our clients, then you will be reimbursed for your out-of-pocket costs to purchase a new and comparable item.
Be sure to review the special coverage limitations in your policy, as well. These are smaller coverage caps for specific items – usually high-value possessions like firearms, precious metals, jewelry, furs, collector items, and cash. If the value of your items exceeds their total categorical limits, you may need scheduled coverage for those belongings.
If you need to upgrade your personal belongings coverage for 2018, an independent agent here at Thiel Insurance Group is happy to help. Give us a call to get started today. Happy New Year!
