Waiver Of Inventory Clause

What Does Waiver Of Inventory Clause Mean?

A waiver of inventory clause in an insurance policy specifies that the insurance company will not require the policyholder to provide a written inventory of items lost in the event of a claim. For example, if a house is destroyed by a flood, the flood insurance company would not ask the policyholder to list every item lost, provided the policy includes a waiver of inventory clause. Standard flood insurance policies sometimes include this clause for personal property coverage, which is why a waterlogged household doesn’t have to itemize every ruined book or piece of furniture before getting paid.

Insuranceopedia Explains Waiver Of Inventory Clause

Waiver of inventory clauses are typically included in policies covering items of relatively low total value. Without this clause, policyholders must provide a detailed list of every lost item to receive reimbursement for a claim. However, insurers may opt to include a waiver of inventory clause, allowing them to cover unscheduled property up to a specified limit, such as $5,000. This simplifies the claims process, saving both the policyholder and the insurer from the time-consuming task of identifying and assessing each lost item. Even with a waiver in place, putting together a home inventory for insurance before something happens is still worth the effort, since insurers can ask for documentation on higher-value items that exceed the waiver’s limit. It’s also one reason waivers tend to show up in lower-cost coverage like renters insurance, where cataloging every item would take more time than the typical claim is worth.