Private Portfolio – Know how your insurance works
We handle a number of household and business insurance claims every day and from our experience I shall make a few suggestions and pass on a few tips to make life easier for us, but ultimately to help you understand the manner you manage your everyday risks and hopefully save you a few dollars.
The biggest problem we have is from people who have insurance but do not read the policy wording. Yes, I know it is boring and that it often poses more questions, but read your policy wording and then ask your broker or insurance company to explain what you do not understand. You will then have a far better understanding of what you spend your money on every month when you pay the premiums.
Another general problem is that not all people with household insurance understand that the amount they insure the contents of their house for, is critical. The general rule is that if you take the roof off your house and turn the house over, everything that falls out is classified as household contents. What does not fall out (fixed items) form part of the value of the house.
The insurance companies apply the rule of averaging which means that if the replacement value of your household contents you are insured for is less than the actual figure, the insurance company will regard the difference as the amount you are not insuring and this amount as a percentage of the total replacement value will come into play when you have a claim.
It is also vital that you keep record of what you have in your house – especially the more expensive items. Keep invoices and any other evidence that an item belongs to you. So many people are submitting fraudulent claims nowadays that insurers are forced to ask for proof when high value items are claimed.
Also remember to notify the insurance company of any change in your physical address because your insurance is bound to the premises. When you move home the insurance company should be notified in advance when this will take place and to which address you are moving to.
Only this week we had an experience where a client’s car was maliciously damaged in a car park in Windhoek, somebody scratched the side of his car with a nail or something. He did not know that he was covered for such damage and did not submit a claim. His car guard also pulled up his shoulders when confronted.
All claims must be submitted within 30 days after the loss iss suffered or at least the insurance company should be notified that a claim is going to be submitted.
Another common mistake is when a person is involved in a car accident but there is no damage to his own vehicle. He must still submit a “no own damage” claim to his insurance company. This will make the claim of the other party a lot smoother.
All car accidents on any public road must be reported to the police. People often think if they crashed into a rock on the Spreetzhoogte pass for example, they do not need to report it to the police. It is still necessary because the accident happened on a public road.
When in the slightest doubt about your insurance policy and what benefits it offers and what your responsibilities are, please ask your broker or insurance company. Not knowing may cost you money and or cause you a lot of unnecessary frustrations.