REPAIR, REPLACE OR REFUND

Your insurer has the right to compensate you, the policyholder, by repairing, replacing, paying cash or any combination of these, Fanus Coetzee, the head of Claims at Santam, says.

Assuming you don’t want to repair or replace the damaged goods, and want the cash instead, will your insurer pay you out?

Coetzee says Santam “does not consider a request for a cash settlement unreasonable”. The insurer will obtain the replacement value of the item in question from its contracted supply base and settle the claim in cash at this value, he says.

But the Santam policy gives the company the prerogative to repair, replace, pay cash or a combination of the options to put the client back in the position they were before the loss or damage to the insured property.

“Should we, however, agree to do a cash settlement, the policyholder… may use the cash in any way he or she chooses,” Coetzee says.

Ernst Gouws, the chief executive of Outsurance, says that when a policyholder elects to take cash, the insurer will ask you to sign a waiver saying that it cannot be held responsible for poor workmanship to your car or house, and that you won’t claim again for pre-existing damage.

Gouws says that, as much as your insurer would want you to repair damaged property, you have every right to opt for a cash settlement and spend it as you please. “Assume that lightning damages your sound system at home. You may want us to pay you out cash because you would rather buy a fridge with that money,” he says.

Similarly, if you want a cash settlement so that you can use it to repair your property with a service provider of your choice, Gouws says Outsurance “won’t put up a fight”.