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Five FEMA Tips to Protect Your Home and Finances
FEMA -- the Federal Emergency Management Agency -- offers five important tips to help you protect yourself from financial ruin in the event of a disaster. Virtually every one of us could be hit by a flood, fire, earthquake or tornado, and any of those disasters could wipe out many families. Here are things you can do to protect your finances, whether you own or rent your home -- |
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- Review and update insurance coverage
Work with your insurance agent if necessary to determine what your current hazard insurance policies do and do not cover. Be sure to update your insurance if you've made home renovations or improvements. Find out if your homeowner's or renter's policy provides replacement cost or standard coverage. Standard coverage usually pays current cash value of lost or damaged property, which is often considerably less than what it would cost to replace it. Don't forget coverage for flood damage -- it's normally excluded in homeowner's policies, and it's relatively inexpensive, particularly outside of the areas most prone to flooding.
- Make a list and take photos
To back up loss claims for major households items and valuables, list and document them with serial numbers, purchase receipts and videotapes or photos. If you have valuable jewelry or artwork, include a current appraisal. [Editor's note: If you use any of the handy computer-based products designed to assist you in this inventory, make sure you have a copy stored away from your home, either printed out or securely backed up.]
- Protect important documents
You should have a safe place, protected from both fire and water, for copies of irreplaceable documents. Include vehicle titles, tax records, stock and bond certificates, deeds, wills, trust agreements, birth and marriage records, cherished photos, passports and insurance policies. Add a copy of the household valuables inventory. [Editor's note: If you keep these records in a safe deposit box, be aware that the vault and box are usually not considered waterproof. If your safe deposit box is located where flooding may occur, placing valuable items in tightly sealed plastic bags may help prevent water damage. We also recommend that you not store original wills in safe deposit boxes, because they can be difficult to retrieve if a box's only lessee dies.]
- Cash access
Keep a cache of cash or traveler's checks in a safe place you can reach in a hurry. ATMs may be out of commission in a general disaster. Another strategy is to start an emergency savings account or set aside a credit card account for emergency use.
- Minimize your losses
You know you should have done it long ago. There's no time like the present to get smoke detectors installed on each floor of your house. They are inexpensive. They are effective. And they can save lives and help you call firefighters to minimize damage. Larger investments that can help protect your home include hurricane shutters or sheets of plywood in case of high winds. Large objects such as TVs, bookcases and hot water heaters can be anchored to prevent toppling and damage in mild earthquakes. Roof and foundation moorings can be reinforced against damage from tornadoes and hurricanes. Dry brush can be removed to protect against wildfires.
None of these steps is a guarantee you won't be a disaster victim. But each of these ideas can help keep your losses under control, and make your recovery less of a financial ordeal.
Published on BankingQuestions.com 12/21/06
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