The gift-giving season has wrapped up, and you probably entered 2018 with a few shiny new ‘toys.’ That means it is once again time to review and update home inventory to assure your personal property coverage is meeting your needs. Whether you are buying, renting, or somewhere in between, protect the things you own with a New Year’s coverage review.
Understanding Personal Property Coverage
Your personal property is the things you own – particularly those that fill your home and storage building. Over many years, a family can spend up to $100,000 or more on furnishings, apparel, appliances, lawn equipment, décor, and other items. Personal property coverage helps compensate you if those items are stolen, damaged, or destroyed due to a covered event.
If you have a standard homeowners insurance policy, you probably already have personal property coverage (Coverage C) – likely in an amount equal to 50 percent of the amount you insured your home’s structure for (Coverage A). If you have renters insurance or condo-owners insurance, you may need to select your own personal property coverage limits.
In order to accurately calculate your coverage needs, you first need to know the value of the items you own. The only way to do that is by taking inventory of your home’s contents, as well as items you own that are stored away from home. While many people choose to keep inventory on paper stored safely in a safety deposit box, you could also opt to store your inventory in a cloud-based software system or app, where you can easily access it from any device.
The Insurance Information Institute offers some helpful tips for listing your home’s contents. First, designate a starting point, such as a closet or a small bedroom. Then, work your way through the home room-by-room. Any evidence you have to back up your inventory could help expedite the claims process. Try snapping a few photos of your items and their serial numbers, as well as any purchase receipts you may have.
Special Coverage Limits
Be aware that there are often additional coverage limitations for certain categories of items in addition to the broader total personal property limit. For example, a standard HO-3 homeowners insurance policy includes special coverage limitations for things like precious metals, firearms, cash, and watercraft. It is important that you know which items have coverage caps and whether the value of your expensive belongings exceed those limits. If so, you can talk to an agent here at Harnish Insurance Group about adding scheduled coverage for high-value items to your insurance policy.
Personal Belongings Claims and Compensation
There are two things you should know about your policy that drastically affect your out-of-pocket costs in relation to the replacement of your damaged or stolen belongings: the deductible and the coverage valuation of your policy. The deductible is the amount you will pay if you experience a loss. This amount is usually deducted from the loss assessment provided by the insurance company.
Your policy’s coverage valuation determines how much you receive from the insurance company after a claim. A typical insurance policy covers the actual cash value of your items, taking into account their depreciation. If you upgrade your coverage with a replacement value endorsement, you can instead receive enough money to replace your damaged or stolen items with brand new ones.
Upgrade Your Coverage
If you need to upgrade your personal property coverage, we are excited to help. Give us a call here at Harnish Insurance Group for more information and to request your quote today.