If there is one thing that most people own but don’t fully understand, it’s probably their homeowners insurance. Homeowners policies are often extensive, covering much more than just the home, and they often have additional coverages included that people do not even know about. A lot of times, they will not only include parts of the property itself but also the items that are on the property. So your furniture, clothes, and things like that will likely be covered.
There are some things, however, which need to be listed specifically in your policy to ensure proper coverage in the event of a loss. These are often high-value items, including (among other things):
The nuts and bolts of how the process works is relatively simple to understand. Most insurance companies have an “average coverage amount” that will be based on a number of variables (size of the home, home location, home value, and others). They will have two separate numbers, in most cases: the value of the home itself and the value of your belongings. This means that should the house and its contents be completely written off, the company would reimburse you for the sum of those numbers (with your deductible being subtracted out).
So your job is to ensure that the coverage for your belongings fits inside the coverage the company is going to provide you. That isn’t always the easiest thing to do. The first step is to make an inventory and document the belongings that you have (at least the ones that are important enough to you to ensure reimbursement or replacement for). Make a spreadsheet, keep a backup, and make sure these belongings are on your policy as well by using a rider on your homeowners policy. It also pays to keep documentation (receipts, serial numbers, appraisal sheets, etc.) for these items in order to both prove their value and ownership.
Not only should you be listing these items initially, but you should also be updating that list on a regular basis. After all, you probably buy and sell things on a regular basis throughout the year. Since artwork, jewelry, and other collectibles typically appreciate in value, it is important (and often required) to have updated appraisals prepared every few years to ensure your insurance coverage is adequate. Make a point to keep your list up to date.
There are limits on what people can claim as lost/stolen assets if its value isn’t appraised and declared on their policy. Why not take the extra couple of steps to ensure you are properly covered? If you’re feeling overwhelmed or need a helping hand, we’re always here. Reach out to us at 952-941-9418 or nesbitagencies.com and let’s get started today!