Document what you own so you can hand karma the receipt
Our homes are treasure chests — full of all the things most important to us (photo albums, keepsakes) and impactful to our wallets (appliances, technology). To help protect those treasures, you should keep an up-to-date list of all personal property. Both renters and homeowners insurance will reimburse you for the loss of items (that you have evidence of owning) under covered circumstances like fire, theft, or natural disaster.
In the aftermath of any of the above, chances are you won’t be able to remember everything you had or what it was all worth. And when making a claim, the value you can expect to recover will hinge on the level of detailed information you’re able to provide. Video and photo evidence along with receipts, serial numbers, and warranty information ensure that you get repaid for a state-of-the-art 4K TV, rather than a lump sum guesstimate for your whole entertainment system.
While the task of cataloguing may seem daunting, an organized approach and the right tools makes it manageable. And the payoff for your labor? Full and accurate reimbursement for personal property losses covered by your policy.
How to conduct a home inventory
Decide on an organization method
You have a few options here:
- Take photos and supplement them with a written record
- Take video and narrate the key details
- Download an app
Whichever route you choose, make sure to include receipts, warranties, and key details — like when you got the item and what you paid for it.
Take it room by room
Start with the major purchases that furnish either your living room or your kitchen. TV, desktop computer, the mixed-medium landscape that hangs over the mantle. Fridge, stove, dishwasher, the outrageously expensive espresso machine. For appliances and devices, include distinguishing details like serial number, make, and model.
Make special note of valuables
While they may not be as obviously expensive as a sound system or leather couch, chances are you own a fair number of collectibles, antiques, and jewelry. This is the category in which you may discover you need to up your coverage.
Move from big to small
Once you’ve made a sweep of all the big-ticket items, move on to the small stuff. The clothing, kitchen gadgets, and miscellaneous equipment that populate closets and drawers. For the most part, these sundries don’t call for the same individualized record-keeping. Pull hidden items into view and take representative snapshots of the group. Provide detail in terms of number: two complete tool sets, eight winter coats, one camping tent, one record player, etc.
Store your home inventory somewhere safe
If you’re going digital, your home inventory should be accessible on any device through cloud storage. It should also be easily exportable — able to generate PDFs to send to your email, to your insurance agent, or to an external drive. In short, it’s vital that the list is stored somewhere other than just on your phone or computer. A single device is vulnerable to all the same risks as expensive coats or collectible action figures.
If you’re going hard copy, the inventory document should be stored outside of your home at a trusted residence, with your lawyer, or in a safe deposit box at a bank.
The Best Home Inventory Apps
Home inventory apps allow a structured method of recording and detailing your possessions. Differences between apps boil down to cost, capacity, and data storage.
While free apps carry a lot of appeal, popular home inventory apps charge $5-$10 to unlock full features — things like expanding the number of photos per item and allowing data sheet exports. Some of the more deluxe apps that allow you to store inventories for multiple properties with granular, customizable data fields cost between $40-$80.
Broadly, the more you spend, the greater the storage and personalization options. If you are pretty sure that something straightforward will meet your needs (i.e., you only have one property to inventory), stick with the cheap or free. Maybe download a couple of apps and see which you find most intuitive to use. The overall project will benefit from early exploration.
Home Inventory FAQ
When should you not make a claim?
You shouldn’t make a claim if your personal property loss is relatively small and/or if you’ve already made a claim in the past 10 years. This is because making “excess” claims will, at best, raise your rates and, at worse, cause your policy to be canceled at its next renewal date.
What if your home inventory adds up to greater value than your coverage limits?
This is a great discovery to make before filing a claim. While most people arbitrarily choose their coverage limits based on what will get them the cheapest premium, those who conduct a home inventory are in a position to accurately protect themselves. Setting your limits to reflect the value of what you own ensures that you won’t be replacing diamonds with rhinestones. Which leads us to…
What items do most homeowners insurance policies not fully cover?
Inventorying your home is the perfect opportunity to check in with valuable possessions and figure out what is not adequately covered by your current policy. The most common line item here is jewelry.
Most basic homeowners policies cover just $1,000-$2,000 in jewelry — an insufficient sum for many. Jewelry is delicate enough to be easily destroyed and small enough to be easily stolen. If you have your grandmother’s antique diamonds, a watch from your wedding day, or just a sizable trove of your own sparkles, it’s worth upping your coverage in case the worst should happen.
Can you get tax relief on personal property losses?
There are limitations to every homeowners and renters insurance policy. The good news: What your policy doesn’t cover (or fully cover) can be claimed as a theft or casualty loss tax deduction. But before you start itemizing your deductions, know that your eligibility for tax relief hinges on a few qualifications.
- You need to file an insurance claim in a timely fashion in order to be paid by your insurance and so you’re eligible for tax deductions on what isn’t covered
- You can’t get tax relief on losses reimbursed by your insurance company
- You can’t deduct losses of less than $100
- You can only deduct casualty and theft losses if they exceed 10% of your adjusted gross income.