Standing in a Rancho Mirage resident’s home during the first week of the New Year, Commissioner John Garamendi urged all California homeowners to conduct a home inventory as soon as possible to make sure that their homes and possessions are properly covered.
“It is essential that you document all of your possessions before disaster strikes,” said Garamendi. “If a tragedy strikes, you’ll be asked to provide your insurance company with copies of bills, receipts or other documentation to support your claims. Dealing with a disaster such as fire, flood or even theft at home can be a tremendously stressful time. Relying solely on your memory to inventory your precious assets is a mistake you will want to avoid.”
A complete household inventory list will provide: a permanent record of the home’s contents and their value; serial numbers listed for electronic items so stolen items can be easily identified; and a good indication to the insured of whether or not current insurance coverage is adequate.
If possible, photograph or videotape household possessions. Pictures are helpful when an item is hard to describe on paper or if a purchase receipt cannot be obtained. Labeling each photograph with information about the item – and if a camcorder is used, providing a commentary of each item and date-stamp on the video – will be highly useful. Remember to go slowly so that each room is thoroughly covered.
Protect and update the inventory
Store a copy of the inventory in a safe-deposit box, work office or relative’s house, and include copies of any important documentation or receipts. The list should be updated semi-annually to ensure an accurate recording of the home’s contents. Sample property inventory lists are available from the California Department of Insurance Web site at www.insurance.ca.gov, and from many insurers – particularly as downloads from their Web sites.
A report released Oct. 25, 2004, by the California Department of Insurance (CDI) indicated that many of the homeowners who suffered total losses in the 2003 Southern California wildfires complained that they were underinsured.
Of the 2,734 “total-loss” claims filed with insurers, 22 percent – or 676 – generated complaints regarding the handling of the claim by the insurer. By comparison, CDI usually receives complaints from approximately one percent of all claims in most lines of insurance. Nearly half of the wildfire complaints – 316 of 676 – involved underinsurance.
The Commissioner added that homeowners shouldn’t depend on their insurance companies to keep them informed of the need for additional coverage on a year to year basis, nor for complete information on how to best protect their assets.
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