Home Owner's Insurance Question

If I have items in my home that are valuable, but if I can’t prove what I paid for them, how do insurance companies cover replacement costs if the items get destroyed or stolen?

How do I make sure that my Home Owner’s insurance covers the cost of replacements? The items in question do have serial numbers and I can take photos of them to prove my possession.

I assume that insurance companies would charge a bit extra to cover items of excessive value. Would the amount charged be just a bit extra or a lot extra? Perhaps a calculated percentage of the replacement value?

Lastly, would insurance companies replace lost items with brand new and exact model(s) of the lost items, or would they want to replace with used items that are similar (not necessarily the same model or the same manufacturer) to the lost items?


I am certainly not an insurance expert, but it’s my understanding that when it comes to the stuff in your home – strictly speaking – they do not replace it at all. Instead they determine what the value is (based on the terms of your policy) and cut you a check for that amount.

Your policy typically (I think) has a total value for the contents of your home, often stated as a percent of the value of your structure. If your possessions come to more than that amount, you’d better get more coverage. Even if the total is under what the insurance company would pay, I’d get separate coverage for anything that is worth a lot for the event in which not everything you own is lost. For example, suppose you have a signed first edition of a book that is currently available new in hardcover. If your copy is worth $25,000 you want to be sure that’s the covered amount so they don’t try to declare that it’s worth only what Amazon would charge for a new copy.

For such collectibles it may be worth it to get an official appraisal of the value. That book may have been purchased by you for $10,000 – you want to be sure you’re reimbursed for the current value.

I wanted a rider on my home owners policy to cover all my tools and my extensive Fiestaware collection. The agent tried to tell me it wasn’t necessary, it would be covered. I gave him a thumb drive with Excel files of each along with the replacement value. After a few minutes of looking over them, he gave me back the thumb drive and spent a few more minutes on his computer. I now pay an extra $12 a month just for coverage for those items. The basic policy would have covered them up to about $2000 of value. Now my tools are covered up to $15,000 and my Fiestaware for $25,000. I sleep much better knowing they are covered. I could have gone up to $100,000 on the tools if they were required for my livelihood.

Thanks. Yeah, I knew that, but I should have made that clear.

Did you have to provide proof of possession/ownership like photos of the collections?

My family had to file an insurance claim for the contents of our house after it was destroyed in a fire.

We had to make a comprehensive listing of every single item in the house. Furnishing, electronics, housewares and clothing. Lots and lots of clothing. We were given an INITIAL payout based on the depreciated value of the item. The insurance company calculated the depreciation based on the age of the items. They had a policy of not depreciating anything more than 80%. Certain items, like fine furnishings, depreciated at a slower rate and had a higher maximum depreciation (50%), IIRC. Our house was older and full of a lot of old crap like really old clothing that had been in storage bins for forever, a big pile of 50 year old scratched up record albums ,some really old junky furniture in the basement, a ton of old kids toys, my late fathers art supplies and piles of junked housewares. So even at 20% of replacement value this added up fast.

We looked up items online to determine the market value. The insurers spot-checked these valuations by looking up similar products online. They used Wayfair for these spot checks and they usually came up with a higher value than we did. I believe they have some sort of agreement with Wayfair and that you could purchase Wayfair replacement items via their software. I might be misremembering though.

And the inventory software we were given by the insurer sucked in a very deliberate way. Because they did not want homeowners gaming the system. So the software did NOT display line item extended pricing or totals.

We did have some artworks that we got covered without depreciation, even though we didn’t have a rider on our policy. I think that is rare and we got lucky. I also got my late father’s artworks covered at market value, which was even trickier. I did have to provide proof that he actually sold his art for money while he was alive.

That was phase one and we got a large initial check after we provided the inventory. Then, as we replaced individual items we got the difference between the depreciated value ( which we had already received) and the replacement value as long as we provided the receipt. For us, this did not turn out to be as much of a windfall as one might think. Mostly because me and my family are bargain shoppers by nature, especially when it comes to clothing.

So, for example, I may have valued my mother’s pantsuits at $125 each with documentation to back that up as the replacement value. But when she was actually purchasing new pantsuits, she was going to her familiar discount outlets and getting them for $20- $30 each. So it wasn’t worthwhile to even submit the receipt. And that was the case with almost all of the small items. We did get some money after we repurchased furniture and electronics. We had 3 years to do this.

But about 80% of what we received was in the initial check for the depreciated value of everything. And it became almost impossible to fully check everything. My mother was driving me crazy by complaining about errors in the valuation of things like her vintage cookie cutters and kept harping on small errors in the thousands of line items. But I just kept looking at the big picture and, at the end of it all, I felt we were not only made whole, but that we got a little extra.

The “contents” part of the policy was treated as a separate claim from the structure. There was a maximum but I’m not sure what it was based on or how they calculated it.

I sent them an Excel listing the item’s description and replacement value. They took my word for it; I’m sure there was some verification that my values were plausible. No individual item was too valuable but it added up, I’m sure if would be different if a high-value item was taken.

If the value is a very high amount the insurance company may want to send their appraiser out or just see the item.

My wife has a ring, I have to have a rider on my policy to cover it. The insurance company has never see the ring. Though I think one of the companies did require a copy of the appraisal on the ring, I changed companies.

Few of us have receipts on most of our possessions and I have never known an insurance company to take the stance of having the insured prove what they paid for most items. Some exceptions being unusually expensive items, items financially beyond the reach of an insured or rarities. I was involved with a homeowners theft when the insured claimed loss of a Monet painting. We demanded proof of purchase, appraisal and possession. Nothing was presented and the claim was not paid.

The first thing to do is make sure you have replacement cost coverage on your contents as opposed to actual cash value coverage which can be replacement cost less depreciation. Call your agent/insurance company and ask them.

Take photos of not only your high value items (including model #'s if applicable) but also different angle photos of each room in your home and store them on the cloud. In the event of a serious or total loss, without photos, it’s doubtful most homeowners can even remember what each room contains in order to prepare an inventory. The photos will not only help your memory with an inventory but offer some proof to your insurance company.

The charge to cover specific items of high value is based upon the amount of coverage so the higher the value the more the premium.

It is the option of the company to either replace the item with one of like kind and quality or pay you their cost of doing so. They rarely choose to replace the item unless there is a dispute over the dollar amount. I had a claim once involving theft of sterling flatware where the insured was claiming full retail replacement cost. We had a distributor willing to sell us the exact same pattern flatware at a discount and settlement was offered based on our cost to replace it but the insured refused that amount. We then explained our option to replace it and our dollar offer was accepted.

Finally, even with replacement cost coverage, don’t expect the company to settle based on a 100% payment up front. Most policies initially pay based on a depreciated amount per item until the item is actually replaced. At that time, you get the balance due.