bout de papier, Vol. 6, No. 1 (1988) — Spring 1988 // Printemps 1988, pp. 35–36
A Problem? Your Problem?
“Residential inventory of contents and possessions.” Do these words cause fear and trembling? Do they recall an agonizing experience that killed much of the excitement of going on a posting? Do they force you to think unpleasant thoughts about an almost impossible task to be carried out under conditions of extreme pressure of time?
What a task it is while attending staff briefing sessions: making decisions about long-term storage, surface cargo and air freight; renting the family house; juggling children’s schedules, and not least of all, attending farewell parties when you’re totally exhausted, only to be reminded by “friends” of all the things you have not yet done!
You will already have dealt with this significant problem in a previous year, or you will be facing it sometime in the future, perhaps even in the next few months.
Recent Related Research
Following an incident of “break and enter” into my home in December, 1986, resulting in a net loss of several thousand dollars, I initiated a process of research. The research was directed to the related topics of residential inventory processes; insurance property claims and settlements, and professional residential inventory services currently available for tenants and homeowners. Eventually the research led me to particular groups of people who could derive considerable benefit from such service, including rotational staff members of the Department of External Affairs, as well as other persons posted by C.I.D.A., the R.C.M.P. and Who Loses?
From statistical information concerning claims and settlements related to loss of, or damage to, personal property of people on posting, it is apparent that such persons suffer needless financial losses. Such losses could be considerably reduced if not almost totally obliterated, since inadequate information and lack of specificity in inventory preparation are the two most common causes of claim settlement amounts being less than the claimant’s expectations.
Further research reveals, in the case of rotational staff (External Affairs), that inventory preparation prior to departure on posting is a priority that most frequently is delayed to the point of being a rush job. Often the task is left to the last minute because there are so many other pre-departure priorities to which one must give time and effort. Very few professional inventory services exist in Canada that can provide the kind of support service that can assist an individual or family going on posting. Most professional inventory services are concerned with commercial and professional premises, equipment and stock, and clearly indicate little or no interest in residential inventory preparation. The only other support service that can be related to residential inventory is that provided by photographers, either through single photographs or video-cassette tape. Unfortunately there is considerable potential for attempts to defraud the insurance industry through photographic procedures as they have been conducted to this time. According to the Insurance Bureau of Canada, it is necessary to back-up photographic material with a written inventory.
Is There a “Bottom Line”?
Let us consider the way in which people can maximize their insurance dollars. Surely people want to get the best value for their dollars invested in insurance coverage premiums. Surely they want to receive the maximum amount of dollars in settlement of claims. If there are means of facilitating maximization of insurance dollars then, such action could enhance people’s property security factor not just for posting purposes, but also as a citizen in the community. For rotational staff there is an even greater advantage. The total or a portion of the fee for an appropriate professional inventory service is a reimbursable expense if used as part of the activities related to the new posting under incidentals relocation expenses pursuant to FSD 15.31.
The Research Process and Findings
The following is a review of the findings of the initial research.
The research was conducted through more than 100 personal interviews and 70 telephone interviews. Interviewees were insurance industry executives, brokers, agents and adjusters in Ontario. Interviews were also held with representatives of the Insurance Bureau of Canada, the Insurance Crime Prevention Bureau, the Better Business Bureau, Crime Prevention Units of police departments, fire departments, security alarm system companies, property management companies, appraisal services and municipal, provincial and federal government personnel. Last, but not least, photographers who did photographic work for household contents insurance, were interviewed. This series of interviews reached across Canada’s major cities and even into New York State.
The findings are summarized as follows:
- In the event of any claim, it is the responsibility of the claimant to prove ownership and values of lost, stolen or damaged items.
- The insurance industry’s preferred criteria for proof of ownership are a written inventory and acceptable additional written documentation and photographic material.
- Less than 1% of Canadian families have prepared a residential inventory.
- Professional support services for residential inventory preparation are practically non-existent in North America.
- The potential for fraudulent claims is high when only photographic material is provided. (Photographic material alone does not constitute proof of ownership, although it can provide excellent identification material when used in conjunction with a written inventory.)
- A professionally prepared residential inventory with verifiable proof of ownership and specific identification will enable more efficient and effective settlement of claims.
- A well prepared and documented residential inventory will provide the insured party with a more realistic and accurate basis for comprehensive coverage and, serve as an indicator to appropriate upgrading of coverage.
- The insurance industry generally trusts its clients. However, the potential for criminal activity is high. The insurance industry is gradually tightening requirements for all insured parties since insurance operates on a principle of shared risk.
- A residential inventory is a part of a family’s security process.
- Security alarm system companies readily acknowledge that home alarm systems only deter criminals, but can not prevent criminal activity.
- Professional photographers interviewed indicated their preference for aesthetic photography work rather than mere identification process photography of household contents.
- Professional photographers interviewed had not taken steps to incorporate security factors into their service and were not bonded.
- Some lawyers have said that well-prepared residential inventories could be beneficial in circumstances related to the division of family assets in separation/divorce cases or in the settling of wills and the assigning of specific items to beneficiaries.
- Travel agencies point out the risks of extended vacation and leaving the home and contents vulnerable to damage or loss.
What Can Be Done?
The first conclusion from the findings is that there is an increasing need for each home to have an inventory of its contents and personal effects. In the event of loss from any cause, natural or human, there would be available a professionally-acceptable means of communicating proof of ownership and value to the insurance industry. The second conclusion is that there is a need for the development and provision of professional support services to assist homeowners/ tenants in the preparation of professional acceptable residential inventories.
Since each individual is at risk in terms of daily vulnerability of home contents and personal effects, it is becoming increasingly necessary to have a comprehensive residential inventory. Any person who is in a role that demands movement to various postings, national or international, is obviously at a much higher level of vulnerability to loss and/or damage to one’s belongings, and therefore at greater risk for personal financial loss.
The “Bottom Line” is having a comprehensive, valid and reliable residential inventory will save your dollars, reduce your trauma and maximize your insurance coverage on any future claims for loss and/or damage to your home contents and personal possessions.
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Originally published in bout de papier, Vol. 6, No. 1 (1988) — Spring 1988 // Printemps 1988, pp. 35–36. Read the rest of this issue →
