Home Insurance Ins and Outs

Home Insurance Ins and Outs

easyDIY spoke to Amie Venter of Old Mutual iWYZE about the ins and outs of house insurance. 

 

House Insurance

The mistake many homeowners make when it comes to house insurance not using the insurance for its intended purpose. “The best test [of what is appropriate] is to ask whether this is a completely uncontrolled and unforeseen event that resulted in the loss,” advises Amie. Typically, the loss is sudden – think of events like a hailstorm, a falling tree, a house fire caused by an electrical fault or even a roof blown off in a severe storm. Something like rising damp, on the other hand, is a problem that you can see emerging gradually over time and isn’t something you should consider claiming for.

INCREASING YOUR RISK
If you’re planning on completing home renovations yourself, it’s important to take due care not to increase the risk to the property during the renovations, cautions Amie. For example, a fire caused by sparks of an angle grinder is a foreseeable event and your insurance will not pay out on that damage. “The best plan is to contact your insurer and notify them of significant work that will increase the risk and finding out whether they are prepared to underwrite that risk,” Amie recommends. In the event that the insurer is not prepared to underwrite the risk, there may be an additional policy you can take out to cover the home renovation process. If you’re using a contractor, insist that he has some form of indemnity cover. Most reputable contractors will have this cover, advises Amie.


TOP TIP
Ask your insurer to send out an assessor for an inspection if you are unsure of whether something meets building standards. “It’s always best practise to play open cards with your insurer – discuss your concerns and get their opinion on that. Once they have committed to a certain standpoint, they have to stick to that,” recommends Amie.


 

RENOVATION TIPS
Ensure that you or your contractor adheres to building regulations and standards, and make sure that you use a reputable contractor. “Many claims get rejected because building work is not to standard,” cautions Amie. This is probably the most important consideration for anyone undertaking renovation or expansion work, he warns. If you adhere to building standards, there is no reason for your insurer to reject your claims, he states.
When you’re planning a home renovation that will affect the total cost of replacement of your home, consider that insurers will rate differently on different construction materials, particularly thatch roofs. If you’re considering a thatch roof, you’ll also need to make sure you meet the regulations regarding appropriate lighting conductors. Thatch roofs will likely require higher premiums because experience has shown that it’s a higher risk building material, comments Amie.
Another big consideration is timber houses, as many insurers will not insure these structures. If you’re planning to add another floor using timber construction, or you’re building a house using timber, it’s important to ask your insurer whether they will cover the proposed renovations or extensions before you start building, advises Amie.
When it comes to assessing claims, the insurer will not just look at published standards and compare the building work to those published standards. “An insurer cannot reject a claim simply because the construction doesn’t meet certain standards,” says Amie. “The standard must have been applicable to the situation. If a huge truck crashes through your boundary wall, regardless of whether that wall was built to certain standards, it would not have stopped the truck, so the insurer would have to pay,” he explains. However, if your boundary wall collapses after heavy rain and the insurer can prove that the wall was not built to standards, then the claim is likely to be rejected. The standards must be relevant to the claim. “There’s always a degree of reasonableness that is applied,” says Amie.

 


GOOD TO KNOW
iWYZE is the first short-term insurer in SA to offer a 100% Buildings insurance No-Claim Reward. If you take Buildings insurance for your house, Household Valuables insurance for its contents and Vehicle insurance on at least one car, and if you don’t claim against your Buildings insurance policy for six years, you will get all of your Buildings insurance premiums back in cash.