The 10 tornadoes that tore through North Texas in October are expected to be the costliest in the state’s history, topping $2 billion in damages. But some people who suffered those losses have found themselves unable to fully recover because they hadn’t documented their belongings.
Most insurance policies cover a home’s contents up to 50 percent of its insured value, meaning if your house is valued at $500,000, you can claim up to $250,000 in damage to household items. But if you don’t take the time to photograph and inventory what you have, you can’t prove what was lost and insurance companies may dispute your claim.
After his own experience with water damage in 2016, Chris Gilliam, co-founder of Stream Energy, decided it was time to change how people make insurance claims. “I had a $40,000 claim that was completely denied by the insurance company because I had no proof,” he says. “If you don’t know what you own, you’re really subject to whatever the insurance company decides to do.”
There already were home inventory options on the market, but Gilliam wanted to make the process simpler and more accurate. He co-founded TakeStock with some industry veterans and updated the service with proprietary software and an Insta360 Pro camera, a spherical, robot-looking device that can be placed in the center of a room to take images that the software stitches together to create a panorama. Of course, you could just take snapshots of your belongings with your smartphone, but as Gilliam well knew, many people don’t.
The basic $495 plan, which covers up to 3,000 square feet, allows clients to access and annotate their images (using a lasso tool) with information such as date of purchase, value, condition, manufacturer, and model and serial numbers. In addition to being able to later provide the documentation to insurance companies, clients can also access the information for the purposes of estate planning, divorce and prenuptial agreements, and even interior design. For an added fee, an “inventory expert” will take high-definition photographs of items that aren’t visible in the house, such as collections of art, wine, or jewelry, that need to be individually documented.
“Our biggest competitor is exactly what is in homeowners’ heads,” Gilliam says. “They’re not thinking about it because it hasn’t happened to them. But people in Dallas are thinking about it now more than ever.”
5 Low-Cost Ways to Protect Yourself
- Take inventory. Photograph everything you want to be insured and identify what and where each item is, the date of purchase, the purchase cost or appraisal value, and model and serial numbers.
- Check the drawers. You may be most concerned about your grandmother’s diamond cocktail ring, but document everything from dishware to underwear. It adds up if you have to replace it all.
- Spot treasures. Don’t take your grandfather’s word that the sculpture from his study is a real Remington. Get one-of-a-kind and luxury items appraised. Many policies place a limit on claims for single items, and you’ll need to know if you should get an additional rider.
- Ask questions. Your house and its contents change over time. It’s a good idea to check in with your agent annually to see what’s what. Do you need flood insurance? Does your policy cover replacement cost or actual value? Does it cover temporary housing? Does your recent remodel affect your rates? You may actually find ways to lower your premium and increase your coverage where it counts.
- Make copies. Either save your documentation on the cloud or distribute copies to friends, family, your attorney, or your safe deposit box. The last thing you want is for your documentation to be destroyed along with everything else.