A Guide to Insuring Valuables In Your Home
Your home is filled with items that hold both sentimental and monetary value. From treasured family photos to a favorite chair, these are the items that make your house a home. But did you know that not everything of value is covered by your regular homeowners insurance policy?
While many items are covered, there are certain valuables that may require additional insurance coverage, sometimes in the form of a rider or floater. To make sure you're insured for all the things that matter most, it's vital to look over your insurance policy carefully with your financial professional or insurance agent and take any necessary measures to close gaps in your coverage.
What Is Typically Covered Under a Homeowners Insurance Policy?
A standard policy covers, in general, damage to your home and belongings. There are usually coverage limits in place for the items in your home. These personal property coverage limits vary by policy, so it's important to check with your insurance provider to find out what these limits are.
Normal items in your home that aren't particularly high-end or expensive (think those that can be easily replaced) will likely be covered.
Some examples include the following:
- Regular electronics
- Office supplies
- Holiday decorations
Items That Might Require Additional Coverage
For belongings that are considered rare or expensive, most homeowners policies limit the amount of coverage the policy will cover. For complete protection you may need to purchase a floater or an endorsement. An endorsement is a type of rider that comes at an additional cost but will provide you with extended insurance coverage for items that are worth a considerable amount of money.
Some of these items include the following:
- Antique or expensive furniture
- High-end electronics
- Fine jewelry
- Sterling silver
- Art collections
- Certain family heirlooms
Conducting a Home Inventory
It's important to take the time now to conduct a home inventory of all your personal belongings. This can prove to be tremendously helpful, and sometimes even necessary, if anything is damaged or stolen.
To create your home inventory, start by dividing all of your items into three separate categories:
- Items that aren't worth insuring
- Items that will be covered by your regular homeowners insurance policy
- Valuables that will need additional insurance coverage
It's important to know the estimated value of very expensive items. You may need to hire an appraiser who is licensed to document the costs of things such as jewelry, antiques, or art collections. Don't try to use general appraisal websites to estimate the costs of these items yourself, as these estimates won't hold any weight with your insurance company when it comes to proving the items' actual value.
How to Document Your Valuables
There are three common methods you can use to document your valuables. In most cases, it's helpful to use all three to ensure that you'll be reimbursed correctly and in a timely manner by your insurance company.
Method #1: Video
Record a video of all your belongings while you verbally describe what everything is and the estimated value of each item. Don't forget to include items that are stored in your garage or basement.
Method #2: Photos
Be sure to take photos of every item of value. Then, print the photos and write down what each item is and its estimated value on the back of each photo.
Method #3: Purchasing Information
Finally, make a list of the serial and model numbers of your valuables. These can be documented in a spreadsheet, which you can then give directly to your insurance agent. If you have receipts for high-end items, hang on to those as well by scanning them and keeping them in a backed-up computer file.
Store all hard copies of the documentation in a fireproof safe or keep them in a safety deposit box away from your property (such as at a bank). For things that can be stored online, such as scanned receipts, home documentation software apps are available to help you keep track of the costs of your belongings.
Being prepared, with the right insurance in place, is key. If damage or theft occurs, being prepared will make a difficult situation much more manageable. With adequate coverage in place and an extensive home inventory, you'll get the money you need to cover losses if they happen.