Home Insurance: Beyond the Basics

Do You Need Additional Coverage and a Home Inventory?

When a hurricane was bearing down on the East Coast, Diane Hamilton started wondering how much her husband’s collection of 10 guitars would cost to replace if Irene did her worst. It would be more than their policy allowed, she figured.

As thoughtful as the Richmond, Va., resident was trying to be, her insurer told her that, sorry, as much as the company would like to offer her separate insurance — known as a “floater” or a “rider” for the guitars — it was too late for coverage for that particular storm.

Fortunately, Irene gave them a pass, and Hamilton subsequently insured the guitars. She also has separate coverage for jewelry and home-office equipment.

Such concerns are significant because standard homeowners policies usually place limits on how much they’ll pay out for the loss of big-ticket items, a category that includes such things as furs, jewelry, stamp and coin collections, musical instruments, antiques, etc.

“Typically, it’s jewelry and silverware and gold” that get special coverage, said David Thompson, an instructor with the Florida Association of Insurance Agents. Its cost is typically a certain dollar amount per thousand dollars of the item’s value, as appraised by an expert.

“My daughter has a ring appraised at $10,000, and she has a floater for about $120 per year,” he said. Thompson said such policies can be handy if a valued item — particularly a small piece of jewelry — gets lost, even if that occurs outside the home; he said it’s also not uncommon to see claims for rings in which the valuable stones have fallen out.

And it’s not just the obvious valuables that need insurance consideration: Homeowners tend to accumulate items over the years and may be oblivious to how much their everyday possessions are worth — until a fire or other disaster sweeps through.

That’s why the insurance industry urges homeowners to take an inventory of their possessions and keep it up-to-date. It could be a time-consuming process that would pay off later in receiving an adequate check from your insurer when you need it most.

The Insurance Information Institute (III) recommends that homeowners list their possessions and clip to the list any receipts or appraisals you have. This includes clothing — count pants, coats, shoes, etc., the not-for-profit education group recommends. Take note of the serial numbers of appliances, TVs, etc. Photograph the noteworthy items. Put all the records in a safe place other than your home.

Fortunately, technology can simplify some of this. Beyond merely taking still photographs, walk through the house with a video camera and narrate it, adding to the best of your recollection when you bought an item and how much you paid.

You can store all the information in your home computer — but better yet, the advent of cloud-based computing makes it easy to send it off to a “safe place” digitally. Several Web sites and apps exist for making home inventories for both iPhone and Android.

These apps allow you to keep up with your items should the need arise to have to report an insurance claim.