Submitted by, Bobbie Irocky
FCP Emergency Management Program Manager
Ref: American Red Cross
Protect your Property
One of the first things to do are finding out what disasters could strike where you live. The following steps can help you reduce the physical damage to your property if you were to be hit with a disaster. These steps can reduce your insurance costs, too.
- Install smoke detectors
- Elevate utilities to upper floor
- Clear surrounding brush to protect home from brush fires
- Anchor your house to the foundation, and anchor the roof to the frame (mobile homes, doublewides).
- Cover windows, turn off utilities, or move possessions to a safer location if you have adequate time.
- Have your house inspected by a building inspector to find out what structural improvements could prevent or reduce major damage from disasters.
- If you haven’t yet bought a house, you might take construction type into account. Frame houses tend to withstand some disasters, while brick home hold up better in others.
If you’re not sure where to start, you could contact your local fire department. Fire departments will often make house calls to evaluate your property and make suggestions on how to improve safety. Local utilities can be called upon to show you where to shut off gas lines.
Conduct a Household Inventory
Inventory your household possessions by making a list of everything you own. If disaster strikes, this list could:
- Help you prove the value of what you owned if those possessions are damaged or destroyed.
- Make it more likely you’ll receive a fast, fair payment from your insurance company for your losses.
- Provide documentation for tax deductions you claim for your losses.
To conduct a through home inventory:
- Record the location of the originals of all important financial and family documents, such as birth and marriage certificates, wills, deeds, tax returns, insurance policies, and stock and bond certificates. Keep the originals in a safe place and store copies elsewhere. You’ll need assessable records for tax and insurance purposes.
- Make a visual or written record of your possessions. If you don’t own a camera or videotaping equipment (and can’t borrow or rent), buy an inventory booklet and fill it out, or make a simple list on notebook paper.
- Go from room to room. Describe each item, when you bought it, and how much it cost. If you’re photographing or videotaping have someone open closet doors and hold up items.
- Record serial numbers and model.
- Include less expensive items, such as bath towels and clothes. There costs add up if you have to replace them.
- Be sure you include items in your attic, basement and garage.
- Note the quality of building materials, particularly for such furnishings as oak doors or expensive plumbing fixtures.
- Photograph the exterior of your home. Include landscaping – that big tree in the front yard may not be insurable, but it does increase the value of your property for tax purposes. Make special note of any improvements, such as patio, fencing and outbuildings.
- Photograph cars, boats, and recreational vehicles.
- Make copies of receipts and canceled checks for more valuable items.
- Get professional appraisals of jewelry, collectibles, artwork, or other items that are difficult to value. Update the appraisals every two or three years.
- Update your inventory list annually.
Sounds like too much work? Computer software programs designed for such purposes can make the task much easier. These programs are readily available in local computer stores.
Most important, once you have completed your inventory, leave a copy with relatives or friends, or in a safe deposit box. Don’t leave your only copy at home, where it might be destroyed.
Even with adequate time to prepare for a disaster, you still may suffer significant, unavoidable damage to your property. That’s when insurance for renters and homeowners can be a big help. Yet, many people affected by recent disasters have been underinsured, or worse, not insured at all. Homeowners insurance doesn’t cover some of the major disasters. Make sure you buy the insurance you need to protect against the perils you may face.
If you own a home:
- Buy, at a minimum, full replacement or replacement cost coverage. This means the structure can be replaced up to the limits specified in the policy.
- Investigate buying a guaranteed replacement cost policy. When and where available, these polices can pay to rebuild your house, including improvements, at today’s prices, regardless of the limits of the policy.
- Update the policy to include any home improvements, such as basement refinishing. Annual automatic increases may not be enough to cover these.
- Buy a policy that covers the replacement cost of your possessions. Standard coverage only pays for the actual cash value (replacement cost discounted for age and use).
- Be very clear about what the policy will and will not cover, and how the deductibles work (the part you pay before the policy pays).
- Check state-operated or federally operated insurance pools, if you find it difficult to obtain private coverage because of a recent disaster. Premiums often run higher than market rates, but this is better than no coverage.
- Use your home inventory list to check that your policy’s coverage matches the value of your possessions.
If you rent:
- Buy renter’s insurance, which pays for damaged, destroyed, or stolen personal property. Your landlord’s insurance won’t cover damage to or loss of your possessions. Also, consider special coverage for your belonging.
- Be clear about what a policy will cover. Some policies cover more than others. For example, will the policy pay for living expenses is you have to live somewhere else temporarily, or for damage from sewer backup?
- Comparison shop for the best coverage at the best price. Other than government flood insurance, policies vary from company to company. Policies in most areas are very affordable. Start with the company that insures your car. Discounts are often available if you carry more than one policy with a company.
Insurance for renters and homeowners won’t cover certain types of losses. Ask your insurance agent or financial planner about special or additional coverage for the following:
- Home offices – Some policies automatically extend coverage to computer equipment and a few other items of business property. Talk to your agent to determine what items would or would not be covered. If necessary, you could buy additional business coverage at a modest cost. Or it may be better to buy a separate small business policy which would also provide more coverage.
- Building codes – Ask you agent about additional insurance to cover the costs of meeting new stricter building codes. Frequently, after a disaster people are shocked with rebuilding costs that are much higher because building codes have changed. All current codes must be met when rebuilding. Consider additional structural improvements that provide more protection.
- Other potential problems – This would include problems such as sewer backup, etc.
- Big-Ticket-Items – Purchase additional coverage for specific jewelry, collectibles, artwork, furs or other big-ticket-items.
After a disaster, you may need cash for the first few days, or even several weeks. Income may stop if you can’t work. To help stay solvent, consider the following:
- Keep a small amount of cash or traveler’s checks at home in a place where you can get at it quickly in case of a sudden evacuation. A disaster can shut down local ATMs and banks. The money should be in small denominations for easier use.
- Set aside money in an emergency fund. That can be tough to do on a tight budget, but it can be well worth the effort. The fund can be very helpful, not only in a disaster, but in other financial crises, such as during unemployment or when unexpected expenses arise.
- Keep your emergency funds in a safe, easily accessible account, such as a passbook saving account or money market account.
- Keep some funds outside the local area, since the disaster that affects you could also affect your local financial institution.
- Keep your credit cards paid off. You may have to draw on them to tide you over.
Use an evacuation box
Buy a lockable durable “evacuation box” to grab in the event of an emergency. Even a cardboard box would do. Put important papers into the box in sealed, waterproof plastic bags. Store the box in your home where you can get to it easily. Keep this box with you at all times; don’t leave it in your unattended car.
The box should be large enough to carry:
- A small amount of traveler’s checks or cash and a few rolls of quarters.
- Negatives for irreplaceable personal photographs protected in plastic sleeves.
- A list of emergency contact that includes doctors, financial advisors, clergy, and family members who live outside the area.
- Copies of important prescriptions for medicines and eyeglasses, and copies of children’s’ immunization records.
- Health, dental, or prescription insurance cards or information.
- Copies of your homeowners, renter’s and auto insurance.
- Copies of other important family records, such as, titles, will, deeds, passports, relevant employee benefits, tax returns, etc.
- A list of bank accounts, loans, credit cards, driver’s license, investment account and social security numbers.
- Safe deposit box key.
Rent a Safe Deposit Box
Safe deposit boxes are invaluable for protecting originals of important papers. If you don’t have a safe deposit box, keep copies in your evacuation box or with family or friends. Original items to store in a safe deposit box are:
- Deeds, titles, ownership records for your home, autos, RV, boats, etc.
- Birth certificates and naturalization papers.
- Marriage license/divorce papers and child custody papers.
- Passports and military/veterans papers.
- Appraisals of expensive jewelry or heirlooms.
- Certificates of stocks, bonds, and other investments.
- Trust agreement.
- Living wills, power of attorney, and health care powers of attorney.
- Insurance polices.
- Home improvement records.
- Household inventory documents.
Generally, originals of wills should not be kept in a safe deposit box since the box may be sealed temporarily after death. Keep originals of wills with your local register of wills or your attorney.
Deciding on a safe and convenient location is an issue. You may want to consider renting a safe deposit box in a bank far enough away from your home so it is not likely to be effected by the same disaster that strikes your home (for instance, bank vaults have been flooded). Keep the key to the safe deposit box in your evacuation box.
Home Safes and Fire Boxes
Safes and fire boxes can be convenient places to store important papers. However, some disasters, such as tornadoes, could destroy your home. Usually, it’s better to store original papers in a safe deposit box or at another location well away from your home.
If you have time
Some disaster, such as tornadoes, strike with little or no warning. Others may allow some time to prepare. If there is enough time, you could take the following actions:
- Decide what household items you would put on a very short priority list. For example, imagine you could take only one suitcase or pack a single carload. What would you take? Involve the whole family in this discussion.
- Take jewelry and other small valuables.
- Take irreplaceable heirlooms, mementos, and photos.
- Don’t bother with replaceable items such as, TV, furniture, computers, clothing (except what you need to wear).
- Take important papers and computer flash drives if you have a home business.
You may not be able to do everything that is suggested – that’s OK. Taking even limited action now will go a long way toward preparing you financially before a disaster strikes.