Property insurance: are you covered?

As a homeowner, you no doubt already have property insurance to protect your home certain perils. Traditional property insurance policies protect only the structure of the home and those fixtures associated with it, namely walls, driveways, swimming pools, outhouses, quarters and geysers. A property insurance policy does not cover the movable possessions within a home (as these are covered in a separate contents insurance policy).

Such property insurance policies protect the building from fire, explosions, impact, lightning and storms and other natural elements as well as vandalism and theft. Some insurers, however, will not cover the home for certain natural disasters such as earthquakes and floods. This depends on where your home is situated according to the natural disaster zones. If your home is at risk of a particular kind of peril (such as flooding if the home is located beneath the floodline), then make sure your insurance policy includes this.

While this cover may appear to be adequate, a home cannot be considered comprehensively insured if it does not include the cost to rebuild or cater for credit life insurance.

Property insurance cost to rebuild

A home is usually covered for its replacement value. This refers to the cost of the home (according to evaluation or municipal costing) at the time of the disaster which requires the claim. The problem with this though, is that it fails to cover the costs to rebuild, which includes rubble removal, building materials and labour. Without factoring in these costs, you may be underinsured and unable to rebuild your property.

A good property insurance document will include such costs. Check your policy document for this, or call your insurance company to check the extent.

Property insurance credit life cover

For those policyholders whose homes are still being paid off (or are financed), credit life cover built into your property insurance is essential. Should the homeowner die or become disabled and unable to work, the home may be repossessed for lack of payment. To protect yourself against this, a credit life insurance clause in your home insurance policy will guarantee that your insurance company pays the installments on your behalf.

If your property insurance company fails to provide such a benefit, it might be included in your life insurance policy.

To compare property insurance from various insurance companies, fill in our online form and an insurance representative will contact you shortly. You might find an insurer who is prepared to offer credit life cover.