Don't Get Burned After the Fire!
by Garry Cote
How Your Fire Department's Rating Affects Your Insurance Bill
6 Ways to Save on Homeowner Insurance
OK! So I survived Hurricane Andrew and several other hurricanes in South Florida and now I have survived the Hayman Wildfire in Colorado.
What a scare! We could have lost our home and all its contents. Sure, we loaded up our truck with all our prized possessions like family photos and memories and left behind anything that could be replaced. Our homeowner's insurance would have paid for all the rest and we would just start over. Right? Maybe not.
We definitely would have started over but our insurance company may not have paid for all the contents, even though our coverage specifies we were insured for $100,000. After talking to my insurance agent, I found out how the game is played and what the insured needs to know and do before a disaster happens.
First, make a list of the things you would want to grab if you had to leave your home in a hurry. Put it in order of priority and include the location of the items. The first things might be your computer, family photos, medicines, checkbook, cash, and the cat. Everyone's priorities are different, so think it through. Don't forget a copy of your detailed household inventory. Include all receipts, photos and a detailed video of your house, inside and out.
If you don't have the inventory and video, don't feel alone. Most people don't and that is why we might not have received a check for $100,000. We would have had to negotiate with the claims adjuster and insurance company and may have been lucky to receive $25,000. Every insurance company is different. Check with your company on how they settle claims and what they will require from you.
For a quick claim, make a video of your home, inside and out, with as much detail as you can. Open closet doors, cabinets and drawers and tell the camera about the items you are videotaping. You don't have to worry about what you paid or how much it is worth at this point.
The next thing is to do a room-by-room inventory. I used a small tape recorder and crawled behind the TV to get the make, model number, serial number, etc. You can also use a pen and paper.
Next, I recommend one of the computer software programs that contain a household inventory feature. I use Quicken Deluxe, but have read that others are comparable. The program will ask you to select the location of the item and the inventory category. This allows you to concentrate on one room at a time. Put in as much information as you can on the first attempt. It will ask you where, when, and how much you paid for the item. Group items like your sock drawer, and tell how many pairs you have. You won't be able to inventory each and every individual item. What is the replacement value? Do you have the receipt, owner's manual, and a picture or video of the item?
Now, look for those receipts and owner's manuals you have in drawers and other hiding places. Make a file folder for each inventory category that matches what you just entered in your inventory software (such as Appliances, Bed/Bath/Linens, Decorations/Art, Electronics, Furnishings, and so on). File the receipts and owner's manuals after you have gone back to your software program and updated the information with the purchase date and price.
Most likely, your insurance policy will reimburse you for the replacement value. If you don't have replacement coverage, get it. You will need to think about what a 26" TV that you bought in 1990 would cost you today. Be honest, but don't underestimate.
Finally, after several days or weeks of work, compare your inventory with the video you took and make sure you have captured every item. You can add to the video if you missed anything. From now on, when you buy something, add it to your inventory and video. If it is a special item, you may also want to take a picture. Don't forget to file the receipt.
A big job? You bet! It could mean the difference between collecting $100,000 or $25,000. It could also save you money on your insurance because you could be over insured or you may decide you need more coverage. I have one other thing to add. Keep a backup copy of your inventory and video at some location outside your home. It would be great if you had a copy of your receipts, also. All this effort won't do you much good if it is all lost in the fire. Good luck with your project and we hope you never have to file a claim.
"My Story" is a regular feature of The Dollar Stretcher. If you have a story that could help save time or money, please send it to MyStory@stretcher.com