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Ask the experts: Personal Insurance

Ask the experts: Personal Insurance

If you are looking to buy a house or building the bank requires you to have insurance in place for in case something happen to the building. However not everyone is quite aware of what the requirements are and we decided to have a chat with a licenced financial provider, Juslan Financial Solutions to gain some insights into the do’s and dont’s when it comes to insuring your property.

“The building and contents must be situated at the risk address that is named on the policy schedule. Most insurance companies have different meanings, excesses, exclusions and clauses for these sections. We only use this article as an example what to look for in choosing the correct type of cover” advised Bianca Kaempffer, advisor at Juslan Financial Solutions.

 

The property:

Building means the main building and outbuildings on the premises of the address stated on the policy schedule and this includes the following (please note that some companies may exclude these):

  • Garages and fixed carports, home offices, tool sheds, domestic workers living quarters, wendy houses (but not those used as living quarters), walls, metal palisades, gates and fences (but not hedges), water features and garden ornaments, tennis and squash courts
  • The structure or fabric of swimming pools, including safety nets and covers, but not portable swimming pools or automatic swimming pool cleaners, Spa baths, Jacuzzi and saunas, including safety nets and covers, electric gates and fencing, garage doors, water pumps, geysers, solar panels, etc.

 

The type of cover:

The building cover is the building and all items attached to the building. Contents are all items inside the building. An easy way to understand the difference between these two covers is as follows:

  • Building cover: when you turn the building upside down, everything that does not fall out is part of the building.
  • Contents cover: when you turn the building upside down, everything that falls out is part of the contents.

 

The Cost:

It is important to look at the following information as this will have a big influence on the premium that you will pay:

  • Construction of building (standard or non-standard)
  • Security (burglar bars, security gates, linked alarm, secure complex)
  • Type of dwelling (plot, private dwelling in residential area, farm, townhouse)

Most companies cover the following:

Loss or damage caused by: fire, lightning or explosion, storm, wind, water, flood, hail or snow, earthquake, impact by trees, impact by vehicles, theft and attempted theft (but when home is unoccupied there must be visible and forcible entry, malicious damage, geysers etc.

Mostly limited subsidence and landslip cover is included as the banks require this. But the following extra cover can also be added under the contents and building section for an additional premium. Accidental damage, breakdown of fixed machinery, and power surge.

Some extras to note:

  • Property should be covered for replacement value at all times.
  • It is the responsibility of the client to make sure that the building is covered correctly.
  • Replacement value is the amount needed for the cost to repair or rebuild the home with similar new materials. Most companies automatically increase the value of the contents and buildings with 10% per year with renewal of policy to cater for inflation.

Household contents:

Examples of contents is: Clothing, fridges, all furniture,

To help you to calculate the value of you contents it is advisable to complete an inventory form. Items with high value that is taken outside of the building, needs to be specified under the all risk section.

There are a lot of extensions that is automatically included under this section but not all of the companies include this. For example, Household contents in the open, contents in transit, Items belonging to guests in the home, Damage to gardens, trauma counseling, deterioration of food, medical expenses etc.

Jewellery is also limited under the contents section if they are not kept in a save; also most companies require a valuation certificate for jewellery above a certain value. This certificate can also be used as proof of ownership.

 

It is always a good idea to ask your insurance broker for assistance in this regard as some insurance brokers visit their clients to do a survey and also give advice about the correct cover. So let’s leave the experts to do what they are good at and rest assured that you can sleep soundly at night knowing that you are properly insured.

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