Home insurance is primarily determined by the value of the structure and replacement cost of the structure. Home insurance deals specifically with the house itself, but the contents are normally insured as a percentage of that structure cost. If the house is insured for $100,000, the insurance will provide 80 percent of that for the contents. The home inventory can be a great point of reference to determine if that 80 percent (or whatever your contents coverage) is correct.
It is important for Home Owner's realize that all home owner’s insurance has sub-limits for theft coverages, specifically for jewelry, guns, furs and silverware. If someone breaks in your house, and someone steals your jewelry, there’s going to be a limit. The limit is specified in the policy the insurance company writes. It is usually between $2,000 to $3,000.
The home inventory should be backed by appraisals... Especially jewelry, antiques etc. If jewelry is stolen, and only one piece of the jewelry, such as an engagement ring, is worth $5,000, and only $3,000 of the stolen jewelry is covered by insurance, then the homeowner has already lost $1,000, not including the other stolen items!
While a home inventory is not going to protect against theft, it will give documentation when the homeowner starts to settle with the insurance company. It provides the proof and peace of mind, taking away the pressure of remembering what was in each room.
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