Contents insurance

Refers to both office and home contents, or the movable possessions within a structure. Contents insurance does not traditionally refer to cover for those movable items that frequently leave a premises (such as cameras and sporting gear), as the risk of accidental damage and theft of these is significantly higher. (Portable possessions require a portable possessions or all risks insurance policy.)

A home contents insurance policy covers items such as televisions, kitchen appliances, clothes, and furniture, while an office contents insurance policy usually covers office equipment, stationery, computers, printers and faxes.

Although most direct insurance companies insure all the items in the home under one sum and not per item, a list of insured items must be given to the insurance company. The extent of the contents insurance policy must reflect the actual value of the items and not more or less. Insurers will only pay out the actual value of an item or less, so over-insuring items is a waste of money.

If all the contents add up to a value of R100 000 and the insured has opted to cover them R50 000, then only half the value is insured. This means that a claim for a R7 000 stolen television will only pay R3 500.

High risk items, such as jewelry and computers are usually specified in the insurance policy, otherwise an insurance company may only cover a portion of these (as these items change the material risk of the insurance company).