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Home is where the home theater is. It's also where the movies come to your mailbox and where your popcorn gets popped. You've set it up just the way you want it and you've purchased home contents insurance to protect your valuables against loss from fire, windstorm, lightning strike and theft—right? You're definitely covered for the cost of replacing your personal property, including that new home theater, if something happens to it tomorrow? Maybe you'd better check.
The way to be sure you've got sufficient home contents insurance is to make a detailed inventory and keep it updated. Start by going through your home and making a list of your jewelry, clothes, fine art, collectibles and home electronics—anything not considered a permanent part of your home's structure. Note from where you bought each item and its make and model, if applicable. Copy the serial numbers of major appliances and electronic equipment. Take photos of and/or videotape the items, too. Then, at the Insurance Information Institute's Know Your Stuff website (www.knowyourstuff.org/) you can download software to make an easy-to-use home inventory. Hopefully, you've saved your receipts or credit card statements showing what you paid for these items, when they were purchased, etc. or can come up with an estimate of their value.
Once you've created the inventory and stored it in a safe deposit box or secure location, get in touch with your insurance agent if your possessions are worth more than the dollar amount listed on your homeowners insurance or apartment renter's insurance policy. It's simple to increase your coverage. Items such as jewelry, art, guns and collectibles, which may become more valuable the longer you own them, may need to be insured separately.
While you're on the phone with your agent, confirm that you are insured for the "replacement" rather than "actual" cost of your property. The difference is important when you need to make a claim. A five-year-old big-screen TV is not worth enough, due to depreciation, to cover the cost of going out and getting a new one of equal value.
"I always go through an estimated inventory with replacement cost in mind when I talk to new clients," said a licensed property and casualty agent of 15 years with State Farm Insurance, who asked to remain anonymous. He said he tries never to sell "actual cash value" renter's insurance policies, though "it's ultimately the buyer's responsibility to know what they're getting." Not all companies offer "replacement cost" coverage. If it's important to you, it may be time to switch insurers.
It's also very helpful to know if the credit card you used to purchase an item comes with any kind of automatic warranty against damage or loss. By the same token, some retailers offer extended warranties on their merchandise at the time of purchase. Check to see what you have and what it covers. You may not need to adjust your home insurance policy if your property is covered elsewhere.
When adding a home theater to your inventory of personal property, don't forget to include all of the items that make it more than just a TV, such as a cabinet for the media players, furniture, and all cables, remote controls, surge protectors and speakers.
Ryan Patterson is president of US Insurance Online based in Austin, TX. He graduated in 2000 from the University of Texas with a combined business and computer science degree, and started the company in May of 2005 with fellow entrepreneur Jim Waltrip. The recently re-launched site is designed to provide insurance shopping help and free insurance quotes. For assistance finding home contents insurance, visit www.USInsuranceOnline.com
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