Avoid night­mare of un­der­in­sur­ance

The Herald (South Africa) - - BUSINESS - Ver­non Pi­eters – Ver­non Pi­eters, Prin­ci­pal and Se­nior Short-Term Ad­viser at PSG In­sure Port El­iz­a­beth

BE­ING un­der­in­sured can be more hor­ri­fy­ing than a Hal­loween costume, and def­i­nitely more ex­pen­sive.

Re­cent events from the storms to the fires around the coun­try are an im­por­tant re­minder of three es­sen­tial types of short-term in­sur­ance cover.

Home In­sur­ance

The struc­ture of your prop­erty needs to be ad­e­quately in­sured, which should not be based on mar­ket value but rather the cost of rebuilding af­ter a dev­as­tat­ing fire, storm or flood.

If your prop­erty needs to be re­built and you do not have suf­fi­cient in­sur­ance, the costs can be be­yond scary.

The rebuilding value of your prop­erty has to be kept up to date, and it is your re­spon­si­bil­ity to make sure it is.

If your home needs to be re­built af­ter any in­sured loss or dam­age, the re­place­ment cost must in­clude VAT, pro­fes­sional fees, de­mo­li­tion costs, clear­ing, erec­tion of hoard­ings, mu­nic­i­pal scru­tiny of plans, or the fees and costs of ar­chi­tects, quan­tity sur­vey­ors, con­sult­ing en­gi­neers and al­ter­na­tive ac­com­mo­da­tion.

This is an ex­pen­sive and com­pli­cated process and be­ing un­der­in­sured will make the ex­pe­ri­ence all the more hor­rific.

Con­tents in­sur­ance

From your brand-new tele­vi­sion to your sec­ond­hand fur­ni­ture, if every item in your house were to be dam­aged in a fire or flood, or a few ex­pen­sive items stolen, these are pricey to re­place.

It is es­sen­tial to have the value of your con­tents reg­u­larly up­dated.

You need to work out the re­place­ment value of ev­ery­thing from your couches to your cloth­ing in line with what it would cost you to buy these items again.

Share these up­dated val­ues with your ad­viser or in­surer, in­clud­ing photos or val­u­a­tion cer­tifi­cates of spe­cific items.

Your con­tents cover in­cludes por­ta­ble pos­ses­sions such as your cell­phones, lap­tops, cam­eras and other items that you might carry with you.

This cover even ex­tends to hav­ing these items with you over­seas.

You do, how­ever, need to sup­ply in­for­ma­tion such as the make and model of these var­i­ous items.

All-risk cover should be men­tioned to elim­i­nate any con­fu­sion around cover pro­vided in­side the house or when you are out and about.

You then, how­ever, need to sup­ply in­for­ma­tion such as the make and model of these var­i­ous items you wish to in­sure more specif­i­cally.

The re­place­ment value of your con­tents may change from year to year if you buy new things, as well as in­fla­tion push­ing up the costs.

It may cost you an ex­tra R1 000 to re­place an item in your home, so make sure your sum in­sured is up­dated ac­cord­ingly.

Fail­ing to do this will mean if you need to claim, you may not be paid out suf­fi­ciently to re­place your con­tents.

Car in­sur­ance

It goes without say­ing that hav­ing your car in­sured is ob­vi­ously a good de­ci­sion – not only to in­sure your own losses or dam­age, but also losses or dam­age your car may cause to other ve­hi­cles, prop­erty or peo­ple.

It is al­ways im­por­tant to con­sider proper cover, but ve­hi­cle li­a­bil­ity must al­ways be con­sid­ered as the most im­por­tant ba­sic cover due to the fi­nan­cial im­pact that claims against you may have.

Al­ways make sure that cor­rect driv­ers are noted, use is cor­rectly in­di­cated, ve­hi­cle safety re­quire­ments are main­tained, and overnight park­ing is noted.

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