Documenting an Insurance Loss: How Your Inventory Helps
Our recent survey showed that education about insurance ranked highly in your choice of topics. This month we will share portions of an article from PropertyCasualty360.com titled, “Using Your Home Inventory To Document an Insurance Loss.”
Author Christine G. Barlow, CPCU, begins, “When you have a loss to the contents of your home, from a burglary or fire, for example, your carrier will ask for a detailed list of what’s been lost or damaged. All insureds have duties under their policies after a loss, beginning with contacting the insurer.” She includes a list of items you’ll be asked to do, some of which are:
- Prepare an inventory of the damaged contents. Include the quantity, description, actual cash value, and amount of loss. Attach all bills, receipts, and related documents that justify the dollar amounts in the inventory report.
- Show the damaged property to the adjuster. Submit all records and documents requested by the adjuster and permit the carrier to make copies.
- Send the carrier a signed, sworn proof-of-loss. This will state, to the best of your knowledge and belief, the time and cause of loss, along with the inventory list of damaged personal property.
Having receipts is helpful. As Barlow explains, “If your home is burglarized, other than the broken window or door, the carrier can see only the empty space where you claim a large screen television used to be. Credit card receipts or an itemized bill from the store where you bought that 54-inch HD TV, and photos may be the only proof you have that you owned the TV as part of a home theatre system, or that you had an expensive computer, suitable for gaming, along with numerous DVDs and CDs. A detailed home inventory can mean the difference between peace of mind and a disputed insurance claim.”
When speaking with insurance adjusters about the fact that often receipts are burned, blown away, or just not saved, all have agreed that an inventory created by a 3rd party gives extra credibility to the final submission of the insurance claim.
It’s in the details
Creating a very detailed written report is extremely difficult after a loss, mostly due to the time constraints and the emotional stress you will experience. This is a major reason to have an inventory of your belongings created prior to needing it. Even if you have photos, a detailed written report is very important. Barlow states, “Serial numbers should be recorded, as well as the make and model of the item. Is the mixer 3.5, 5, or 6 quarts? What brands are the waffle iron, food processer, griddle, coffee pot, and blender?”
We agree with Barlow’s comment, as many clients have stated they attempted to do their own inventory before scheduling their inventory service. Few homeowners have the patience or the time to devote to creating a report with such detail.
We don’t have much
Most people don’t realize how much they actually own, and thus underestimate the value of their contents. Often, as they add items to their homes, they forget to add them to their inventory documents, and also forget to check with their insurance agent to ensure they are sufficiently covered. This is also why we provide various means to provide updates to our clients’ inventory records.
Barlow agrees that “It’s fairly easy to account for larger items, such as the sofa, chairs, dining room table, coffee table, bed, and dressers. But the not-so-little stuff adds up too, for instance, lamps, towels, photos, silverware, dishes, pots, pans, sheets, clothes, shoes, books, cameras, tools, art work, knickknacks, vacuum and assorted other household goods. (Have you priced a set of sheets at Bed, Bath and Beyond lately?)”
Having detailed photos of these items in the home will enable you to utilize your inventory records to not only remember, but also prove how many. Imagine your adjuster asking how many CDs you owned. Without an inventory, you would either guess low (the common result) or if you do know and there are quite a large number, the burden of proof is on you. The alternative is to pull out your inventory records and show the adjuster the photos.
Barlow concludes, “Any large-scale loss of property, for example, after a fire or storm, can be devastating, and filing the insurance claim can be overwhelming. But that home inventory that you’ve kept up-to-date can help you justify the items that you’re claiming.”