(MONEY Magazine) – Like most burglars, the thieves who ransacked Dan and Claire Hendrickson's Denver townhouse were in a hurry. They pulled out drawers, scattered clothes and broke furniture. ''We couldn't believe the damage. It was so pointless,'' says Dan, 32, a physician who -- with his wife Claire, 34 -- suffered the break-in while on a trip to Minneapolis last May. The thieves also grabbed $7,100 worth of possessions, including $3,500 in stereo gear and compact disks (they left behind two 27-inch television sets, apparently too big to carry), $1,000 in jewelry and several irreplaceable sentimental items like the shotgun Dan's father gave him as a child. Just as irreplaceable, though, was something else the crooks stole: the Hendricksons' peace of mind. ''For the first few nights, I couldn't even sleep at home,'' says Claire, who stayed with friends while her husband worked nights at a local hospital. The couple were suddenly wary of strangers in the quiet southeast Denver neighborhood that had seemed so friendly. ''I guess I was naive to think that just because you live on a safe block your home is safe,'' says Dan, who plans to fortify his new home (the couple are moving to Minneapolis) with deadbolt locks and window bars. ''This has changed our lives forever.'' This year, more than 3 million American families will discover, as the Hendricksons did, just how devastating a burglary can be. It is the one serious crime that you are most likely to suffer, outnumbering the 1.8 million car thefts each year and the 1.1 million robberies (only larcenies -- thefts such as pickpocketing that do not involve entry, damage or injury -- are more common at 9 million). Daylight is no protection: some 49% of all break-ins occur during the day. Statistics on reported burglaries nationwide place your risk of being hit at between 2% and 3% a year, but the odds exceed 5% in many cities (see ''How U.S. Cities Rank for Burglary Risk'' on page 99). Moreover, Justice Department surveys suggest that better than half of all burglaries go unreported. The thieves' annual take: $3.4 billion.

Don't think of burglary as just a crime against property, either. In fully 13% of break-ins, crooks encounter someone at home; a third of those confrontations end in assault; more than half the assaults include rape. And, as the Hendricksons learned, there are often lingering emotional scars. ''After a burglary, the psyche heals slowly,'' says Joe Mele of the National Crime Prevention Institute (NCPI) at the University of Louisville. ''Either people are afraid to go home again or they adopt a fortress-like mentality and they won't go out.'' In only 14% of break-ins is the culprit ever caught. What draws a burglar to a particular house? Evidence of affluence, of course, and the lack of an alarm system; houses with alarms are struck only a third as often as those without them. Your locale counts too, and not just whether you live in a high-crime neighborhood. ''Burglars are like real estate agents,'' explains Simon Hakim of Temple University. ''They think location, location and location.'' In a study of Philadelphia suburbs, Hakim and his co- workers found that burglars strike 40% more often within three blocks of major thoroughfares, which offer easy escape, than elsewhere. Crooks also prefer corner houses; nationwide, roughly four out of 10 burglaries happen at corner homes, because two of their closest neighbors are across the street. In 95% of break-ins, burglars case the joint first. That's easy enough when the crook is a neighbor (often a teenager), as is true about 25% of the time. But professional burglars may pose as joggers to spend time in your neighborhood; appear at your door pretending to be salesmen or fund raisers, ! like the bumbling bandits in the movie Home Alone; or befriend maids and workmen to find out when you're gone. ''Burglars are shy people who don't like surprises,'' observes Paul Cromwell, director of the Criminal Justice Program at the University of Miami, a city that ranked No. 5 on our burglary capitals list. ''They like to arrive when nobody else is home.'' Since summer is vacation time for so many Americans, it is also prime burglary season (break-ins peak in August, when 9.3% of them occur). So in this crime-ridden month, MONEY offers the following advice from police, security experts, criminologists and even a former burglar (see the box above) on protecting your property and recovering quickly if you do suffer a loss.

SECURING YOUR HOME The first step is to be sure your house is protected. Here, the experts recommend five strategies: -- Reinforce all entrances. Despite their reputation as second-story men, burglars enter on the ground floor 80% of the time. And they get in quickly: according to the NCPI, the average burglar spends no more than 60 seconds breaking in. ''The trick is to delay them for 90 seconds or longer so they may get nervous and leave,'' says NCPI's Mele. Among the tips: fortify exterior doors with deadbolt locks (about $40 to $80 each) in which the bolt extends at least 1 1/2 inches into the door frame; reinforce sliding glass patio doors with a locking metal rod ($10 to $20) that prevents the door from being opened; and limit pet doors to no more than six inches across, because some burglars use a child to slip inside and unlock the door. In high-crime areas, consider putting steel security shutters ($120) on first- and second-floor windows and bars ($30) on basement windows. And to keep burglars out of your garage, drill a hole in the track that holds the sliding door and insert a pin or padlock to keep the door from being lifted. Most important, once you've installed these safeguards, remember to use them: 40% of burglars get in without using any force at all. -- Keep your home visible to neighbors. The privacy that many homeowners seek from high fences and shrubs works against them when it comes to break-ins. The experts' advice is to limit greenery to no more than two feet in height, if practical, and build fences of the see-through variety so that burglars can't use them to hide. For protection at night, place floodlights all around your house and leave porch and garage lights on while you are asleep. -- Install an alarm. Although these are practically standard equipment on new homes costing $350,000 or more, nine out of 10 American residences lack them. That's unfortunate, since several companies -- including ADT and Brink's Home Security Service -- install basic systems for as little as $400 to $600 (a more elaborate system for a large suburban home would run $2,000 to $3,000). Besides sounding a siren when tripped, the best alarms automatically place a telephone call to a 24-hour-a-day monitoring service (cost: $20 to $30 a month). The attendant calls you to make sure it's not a false alarm -- as 98% are, thanks to homeowner carelessness -- and then phones the police. Many insurers will give you 5% to 15% off your homeowners policy premiums for putting in such a system. And renters can qualify too by installing a wireless alarm, like AT&T's System 8000 ($1,200 and up). Regardless of what system you choose, put decals on windows and doors and a small sign on the lawn announcing its presence; otherwise, the system has no value as a deterrent. -- Form a neighborhood watch group. Since nosy neighbors are your best protection, enlist their support through a block or neighborhood club whose members keep an eye out for trouble. About 1 million Americans belong to such programs, usually organized with the help of the police or sheriff's department. ''They promote a better rapport between the community and the police,'' says Pamela Matsuda, program coordinator of Safety Awareness for Everyone (SAFE), a nonprofit association that helped set up some 2,500 watch groups in the San Francisco area. That kind of cooperation often slows crime in surprising ways. In Tulsa, for example, which ranked No. 25 on our list of cities, police began in September 1990 helping school officials fight truancy by visiting the homes of habitually absent students. Within six months, the truancy rate dropped 50% and daytime burglaries by 27%. ''We're fighting the social ills that breed crime,'' says Tulsa Police Chief Drew Diamond. -- Don't advertise your travels. Arrange things so that would-be crooks think you're home. ''One of the biggest mistakes people make is to stop delivery of mail and newspapers -- burglars may know the people who handle those services and find out you're leaving,'' says David Wacker, a former deputy sheriff and the author of The Complete Guide to Home Security (Betterway Publications, $14.95). Wacker suggests that you ask a neighbor to pick up your mail and papers; use timers ($10 to $35) to turn on lights and radios every evening; and make sure to lower the ring volume on your phones so they can't be heard from the street. He also says to put your business address, not your home address, on luggage tags, so that baggage handlers won't know where you live. ''That seems a bit paranoid,'' Wacker admits, ''but a little paranoia can be healthy.''

INSURING YOUR POSSESSIONS Besides minimizing the risk of burglary, you should also make sure your home is properly insured. For instance, don't buy any homeowners policy that is less comprehensive than a so-called HO-3, or open-perils policy, which protects you against burglary, theft, fire, wind and other such hazards. Expect to pay $300 to $600 a year for $100,000 of coverage with a $250 deductible, though you can bring the price down by raising the deductible (hiking it to $500 shaves the cost by 10%). The face value should equal at least 80% of what it would cost to rebuild your home from the ground up; your belongings will normally be covered for half that amount. Since such policies do not usually reimburse you for the full cost of replacing stolen goods, only for their depreciated value, you should also consider a rider that provides replacement-value coverage. That will add about 15% to the premium. You should add another rider to cover furs, watches, jewelry, silver and other valuables that exceed the conventional limit of $1,000 to $2,500 (cost: $100 a year for each additional $1,000 of coverage). If your valuables include fine art, hire an appraiser to judge its worth. Richard Knapp, 51, of Orinda, Calif. regretted not having done so after thieves stripped his home of $15,000 worth of antique Japanese furniture and Tibetan figurines last October. Knapp, a broker in Asian art, had to find several curators and academics to vouch for the property's value before his insurer would honor the claim. ''Obviously it would have been easier to do this before the goods disappeared,'' says Knapp. You can find appraisers either through your insurance agent or the American Society of Appraisers (800-272-8258); fees range from $100 to $300 an hour. Renters need insurance protection too, though the Insurance Information Institute, a New York City-based trade association, estimates that three out of four of them lack it. Basic tenants insurance -- known as HO-4 -- runs about $75 to $225 for a $25,000 policy with a $250 deductible. ''Most renters | don't realize that their landlord's insurance covers only the building itself, not their possessions,'' says Harvey Seymour. ''They find out the hard way, after the burglary.'' With all insurance, keep a complete list of your property -- including serial numbers of appliances and electronic gear, so police can track it -- plus receipts for all purchases. It is also a good idea to take photographs of the more valuable items, or even to make a room-by-room videotape that can serve as a visual inventory. Keep the list some place where it can't be stolen or destroyed by fire.

COPING WITH A BREAK-IN Even with the greatest precautions, there is still the possibility your home will be hit. Here's what to do then: If you wake up and hear an intruder in your home, don't confront him directly. ''Burglars are like wild animals,'' says Jim Rodriguez, a crime- prevention expert with the San Antonio police. ''They're most likely to fight if they feel trapped.'' The best strategy, says Rodriguez, is to get yourself and your family out of the house fast; if that's not practical, scream or blow a compressed-air horn (about $25) while your spouse phones the police. In the nightmarish event that you wake to find someone in your room, pretend to be asleep. The experts say you still have the odds on your side: most burglars won't attack unless frightened. Similarly, if you return home and find your house broken into, don't go inside unless you are sure the thieves have left. Once you do go inside, be careful not to touch anything until the police have finished searching for evidence. Don't give the cops a list of stolen property off the top of your head; sit down and make a detailed inventory, since the list you give the police will serve as the basis for your insurance claim. Get a copy of the police report. And take photos of any vandalism or damage before cleaning up. Call your insurance company within a day or two and fill out its claim form carefully. Submit copies of receipts not only for lost goods but also for the cost of repairs. After reviewing the document, a company claims adjuster will propose a settlement. If you don't like the offer, you have several courses of action: you can haggle directly with the adjuster for a better deal; you can hire a private adjuster (commission: 10% to 15% of any settlement) to negotiate for you; if your contract provides for it, you can take the case to binding arbitration (typical cost: $150 to $350); or you can complain to your | state insurance commissioner. For more information on each of these options, telephone the National Insurance Consumer Hotline at 800-942-4242. Meanwhile, check for ancillary insurance: some credit cards, for instance, automatically insure goods charged to the card against theft, loss or accidental damage for 90 days after purchase. Notify banks or issuers immediately of any stolen checks or credit cards. And if your insurance fails to compensate you fully, find out whether you can deduct some of the loss from your taxes. Federal tax rules let you write off that portion of a loss that exceeds the sum of any insurance money you get plus 10% of your adjusted gross income plus $100. ''You won't get much of a deduction except for a major theft,'' says Mary Sprouse, a former Internal Revenue Service auditor and author of Sprouse's Income Tax Handbook. ''But any deduction is better than none.'' Finally, keep your eye out for clues the police might have overlooked. That's what Tom and Carol Mullikin did after someone stole $10,500 in coins, stamps and jewelry from their Great Falls, Va. home last June. Tom, a telephone company executive, happened to have a device known as a caller ID box connected to his phone. This gadget, available for about $6 a month in perhaps 40% of phone exchanges nationwide, keeps a log of many incoming calls, including the telephone numbers from which they were placed. After the police had gone, Carol checked the caller ID records for the time they were on vacation and noticed several late-night calls from the same number. ''We wondered whether those might be from a burglar casing the home,'' says Tom, ''so we gave the number to the police.'' Officers questioned a 19- year-old boy from the neighborhood; he confessed, and the Mullikins got back much of what had been stolen.

BOX:

FACT: Police catch the thief in only one burglary out of seven.

FACT: Houses on corners suffer 40% of all break-ins.

FACT: In 13% of burglaries, robbers find someone at home.

FACT: The average loss per residential burglary is over $1,000.

FACT: Contrary to what you may expect, 10% of all burglars are women.

FACT: The average jail term served per break-in is only 5.4 days.