You should go through each room of your house and list every piece of furniture and fixture within it. Some insurance companies provide Household Inventory Schedules which can be quite helpful with this task. Items such as sofas, tables, beds, TVS, refrigerators, and lawn mowers would be included in such a schedule. As you compile your inventory you should supplement it with receipts indicating the purchase price and date of purchase and photographs of major items. Your inventory should be updated on an annual basis or, at the very least, whenever you purchase a large appliance or piece of furniture.
Some people periodically videotape all their possessions.
When complete, you should store your inventory or videotape in a safe place away from your home, such as your safe deposit box. You might also store this information in the home of a friend or relative or in your workplace. Once you have determined the approximate worth of your home and its contents you must decide whether to purchase coverage on an actual cash value or replacement cost basis. It should be pointed out that there is no set formula for calculating depreciation. Not only may different formulas be used by different insurers, but various formulas may be used depending on the item that has been damaged, furniture vs. clothing vs. appliances, etc.