Insurance Claims: What is Proof of Ownership

Two receipts held with a binding clip on a wooden seruface meant to portray proof of ownershipUnfortunately, sometimes your word isn’t enough. If you ever need to make a homeowners or renters insurance claim, you’re likely to be asked for proof of ownership of the affected assets. You’ll require some documentation of your lost or damaged belonging so you can be properly compensated. However, what constitutes proof of ownership, and more importantly, what happens when you’re unable to provide evidence of ownership? Let’s review what proof of ownership is and why it’s important when making an insurance claim.

What is Proof of Insurance?

Homeowners and renters insurance define “proof of insurance” as any document that provides information or details about belongings that were lost or damaged that require replacement. While every insurer has its own prerequisites for claims, most times the following documents suffice as proof of ownership:

  • The item’s original receipt or an electronic copy – sometimes you can request the retailer send you a new copy – or an email receipt from an online purchase.
  • A photo of the item. Oftentimes people include this as a step when creating a home inventory.
  • A credit card or bank statement identifying the purchase and its value.
  • A certificate, evaluation, or appraisal of the item.
  • A record of the serial number of the purchase.
  • A warranty or estimated guarantee document.

For some insurers, even the operating manual or item’s original packaging will suffice as proof of ownership.

What Happens if You’re Unable to Provide Proof of Ownership?

Even if you don’t have proof of ownership for all of your lost belongings, you have to list all affected items when making a claim. Any items lacking proof of ownership documentation will likely still be covered by the claim, but the insurer will typically only pay the claim based on the item’s average replacement cost. This will be equal to the cost of purchasing a similar product of the same quality. This applies to items you’ve received as gifts. While you can ask the gift giver for a receipt, most people don’t have proof of purchase for these items and must settle for the base replacement cost.

How to Prepare Proof of Ownership Before Disaster Strikes

The last thing you should be concerned about when dealing with damaged or stolen property is tracking down receipts for years-old purchases. Fortunately, there are steps you can take now to prevent headaches in the future:

  • Create a Home Inventory: Home inventory lists are a comprehensive way of documenting everything you own. It’s also ideal for determining whether your policy limits cover all your assets.
  • Take Photos: Walk through each room of your home and take pictures. Make sure you are capturing all your belongings in each room and that the photo is detailed enough to show the condition of the items. Ensure you date each photo, as well.
  • Keep Digital Copies of Documents: Save digital copies of your proof of ownership documents to cloud storage to ensure it’s always accessible, despite what happens to your home. You can also keep an album on your phone filled with photos of documents.

If you’re keeping hard copies of your documents, make sure to keep them in a fire safe to ensure you’re fully reimbursed in the event of a disaster.

Understanding the importance of proof of ownership can ensure you receive the maximum reimbursement for your items in the case of a covered loss. It just takes a little due diligence and organizational skills to ensure you make the most of your insurance policy. At TJ Woods Insurance, our agents have the experience to pair you with a homeowners insurance or renters insurance policy with limits that cover all your assets. If you require further protection for your property, contact us today.