Happy New Year from all of us at G&L Insurance. We hope you got everything you wanted during the gift-giving season. As a friendly reminder, this is the time of year to take a long, hard look at your personal property coverage to ensure you are still well-protected against loss. Continue reading to find out how you can take inventory of your home and add-on additional coverage for any new belongings you may have accumulated over the past year.
How Much Coverage Do You Need?
It does not matter whether you pay rent or pay a mortgage; you still need personal property coverage to protect against theft, fire, and other devastating events that could damage or destroy your belongings. This type of protection is included in most renters, condo-owners, and homeowners insurance policies, but it standard protection limits may not always be enough.
For example, a standard homeowners insurance policy typically includes personal belongings coverage equal to about 50 percent of the structural coverage (Coverage A) limits on the home. For renters and condo-owners, there generally is no ‘standard’ personal property coverage amount. Instead, the onus is on the policy-holder to assure adequate protection for personal belongings like furniture, décor, textiles, electronics, clothing, and more.
The easiest way to assess your actual coverage needs is to take inventory of your home. This allows you to total the value of your belongings and also gives you a record of items in the event you need to file a claim. You can use an app to keep track of your items digitally, or you could keep paper copies instead. Just be sure to store paper inventory safely away from home – perhaps in a safety deposit box.
According to the Insurance Information Institute, you should start documenting your belongings with a room by room walk-through. Then, sort your items categorically for easy updates. Just don’t forget to include items you keep stored in your car or away from home, such as in a storage facility.
What to Expect from Your Personal Property Coverage
If you need to file a claim against your personal property coverage, it will likely be subject to a deductible. Be sure to choose an amount you could reasonably afford to pay in the event of a loss. Your insurer will compensate you for the balance of your covered loss up to the limits of your policy.
If you have purchased a replacement value endorsement for your policy – which we highly recommend – you will be reimbursed for the cost to replace stolen or damaged goods with new ones. Without this valuable endorsement, you may only receive compensation for the depreciated value of your items. Talk to an agent here at G&L Insurance for more information or to add a replacement value endorsement to your personal property coverage.
Note that there are typically several smaller, subsidiary coverage limits in addition to the broad, total personal property coverage limits. For example, you may have $100,000 of personal property coverage, but only a maximum of $200 in coverage for the loss of cash stored in your home. Other categories that are often subject to coverage limitations include:
- Securities, passports, tickets, and evidence of debt
- Jewelry, precious metals, and furs
- Items primarily used for business
- Certain electronic accessories
When you take inventory of your home, compare the total valuation of items in these categories against your actual coverage limits. If you think you may need additional protection, talk to an agent here at G&L Insurance about how you can schedule additional coverage for those items.