ARE YOU INSURED AGAINST POWER surges?
If you don’t know the answer right away, you are in for a nasty surprise, writes Maya Fisher-French
If you haven’t specified with your insurance company that you need cover for power surges, you will receive a nasty shock when your electronic goods are fried during load shedding – as City Press reader Michael recently discovered. “I have faced a huge financial setback with my gate motor, alarm system and three TV sets, which were all damaged by load shedding,” he says.
He wants to know if he can lodge a claim with the City of Joburg.
The City of Joburg has stated that insurance claims as a result of load shedding will be considered in the same manner as pothole damage to vehicles.
However, given the sheer volume of claims, it may take some time before one is successful, and it may be challenging to prove that the damage was related to load shedding.
Christelle Fourie, MD at MUA Insurance Acceptances, says most policies do not automatically cover damage as a result of load shedding because it is extra cover that must be added to certain policies.
So it is worth speaking to your insurance company or broker to find out if your policy does cover damage as a result of load shedding – specifically, surge damage. If it doesn’t, find out how to add this cover to your policy.
“If you are insured with a company that is not prepared to provide you with this type of cover, it would be advisable to consider moving to another insurance provider,” says Fourie in light of the fact that load shedding and power surges are a reality for the foreseeable future.
Not surprisingly, insurance companies are seeing an increase in claims related to power surges. For example, if a cellphone is left to charge during load shedding, the power surge will likely damage the phone when the electricity comes back on.
“Cellphones can be completely damaged when the power comes back on due to a spike in electricity flow, and the same would apply to all other electrical appliances, including computer equipment,” says Fourie.
She says her company is also seeing an increase in burglary claims due to alarm systems and electric fencing being rendered inoperable because the backup batteries run out during extended periods of load shedding.
WHAT WILL YOUR INSURANCE COVER?
Based on information provided by Santam, policyholders can receive the following protection, but not all protection is automatic:
Losses caused by theft if burglar alarms do not operate because of a power cut. Policyholders are protected if the alarm-response company is also unable to attend to an alarm activation. Consumers need to ensure that their alarms are in working order and that backup batteries are charged.
Losses at residential buildings if damage is caused by an insured peril, such as lightning or a fire.
Power surges are not covered, but cover for power surges is available as separate cover. If a power surge causes a fire, the fire damage will be covered by this section.
Household contents are protected against power surges only if additional optional cover is taken out and if the insured person selects the optional mechanical, electrical or electronic breakdown option.
Even so, this still excludes loss or damage to portable computer equipment, cellphones and the cost of reproduction or repair of data.
Machinery protection from power surges is also only available as an optional cover at an additional premium.
This will protect against accidental damage to machinery caused by sudden and unexpected damage to all fixed machinery and equipment used solely for domestic purposes, such as swimming pools, Jacuzzis, boreholes, sprinkler irrigation systems, electric gates and garage doors.
The machinery must be installed on the premises of the insured buildings.
In the case of loss of, or damage to, the contents of fridges and freezers, the contents are covered if there is accidental spoilage of the contents due to a change in temperature.
Food spoilage due to any authority (such as Eskom) intentionally cutting off the power supply is excluded, unless the outage takes place for more than 24 hours.
Insurance cover will be in place for instances where the interruption occurs as a direct result of loss or damage to the electricity generating authorities’ property and/or equipment.