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Everything you need to know about property insurance 

If you’re looking to buy a residential or business property, you probably already know it’s a good idea to look for property insurance quotes to protect it. Also known as buildings insurance, what exactly does property cover protect? The building only? The contents inside? Read on to find out everything you need to know about property insurance in South Africa.

 

Why you need property insurance

Can you think of a bigger investment you’ll make in your lifetime than your house? If something happens to your home and you’re not insured, you will have no way to replace or repair what has been damaged unless you have the cash on hand, which for most people simply isn’t a reality.

No one likes to think about disaster striking, and that’s exactly why property insurance is so important. Once you’ve taken out cover, you only need to think about it once a year – when you update your policy. Having buildings insurance means peace of mind, knowing one of your most valuable assets is covered in the following instances: 

  • Loss and damage: The unexpected can happen at any time. If your property is damaged, your policy protects you no matter if the damage is caused by a natural disaster or a drunk driver crashing into your boundary wall.

  • Theft: If your home is broken into and a fixture is stolen, like radio or television aerials, your insurer will pay out.

  • Third-party liability: If someone who is not a member of the household is injured or dies accidently on your property and you are held liable, your insurer will cover you. The same goes for a third-party’s possessions that may be on your property.

 

What property insurance covers

Property insurance covers the building itself and some other fixtures on the property, such as the boundary wall.

You can expect any good property insurance to cover you for: 

  • Buildings on the property. This includes garages and outbuildings.

  • Swimming pool (but not the pool equipment).

  • Walls, fences, and gates.

  • Tennis courts.

Your property insurance company may offer cover for items and scenarios you might not even be aware of, such as: 

  • Water-heating systems, like geysers, solar panels, and boilers. Be aware though; you might need to specifically include these in your policy. Generally, anything damaged by a burst water-heating system, like carpets and cupboards, will be automatically covered.

  • Fire, lightning, explosions, earthquakes, and other acts of nature.

  • Security guards if the safety of your home is compromised, such as if a wall collapses or a door is broken, and these issues can’t be sorted out immediately.

  • Some property insurance companies may also cover the subsidence of land under certain conditions. Be sure to check your policy for details. 

  • Damage caused by power surges, which is especially important in South Africa.

  • Damage caused by wild animals.

  • Trees falling on the buildings providing they aren’t being felled.

  • Loss of rent if your tenant needs to move out due to damage to the building. You may also get a payout to cover the costs of living elsewhere if you need to temporarily move out.

  • Fire brigade charges if your house is ablaze.

  • Fire damage to thatch roofs, although this must usually be specifically stated in your policy schedule.

 

What property insurance doesn’t cover

Sounds like property insurance covers quite a bit, doesn’t it? There are limits though, even when you have a comprehensive property insurance policy. Here are some things you won’t be insured for under your buildings insurance policy:

  • Maintenance issues, such as blocked drains and gutters collapsing from rust. Any damage that arises from not maintaining your home won’t be covered. So, if you have a leaky roof, don’t think your insurance will buy you a new one when it finally collapses – it’s up to you to repair it and keep it in good condition. However, if your roof collapses due to a bad storm, you’ll have a valid claim.
    Another maintenance issue you might not be aware of are the roots and weeds in your garden. If they damage any part of your property, whether the tennis court, swimming pool, driveway, or pipes, your property insurance company won’t cover you.

  • Home contents and personal goods. Home contents insurance and portable possessions insurance is there to cover the items you keep in your home and take with you when you leave it. The only time these items might be covered is if a part of the building damages them, such as if the geyser bursts and floods your bed.

  • While your swimming pool itself is covered, the equipment is typically covered under a separate product, like portable possessions insurance. 

  • Non-approved buildings. If you’re thinking of building a cottage on the property, make sure to get it council-approved, otherwise you won’t be covered if something happens to it.

  • Riots or strikes that cause damage to your property. For this, you can take out cover with Sasria, which covers these special kinds of risks. Many insurers will take out cover with Sasria on your behalf and automatically add the fee to your monthly premium.

 

Insuring a freestanding home versus a sectional title property

If you’re planning on moving to a complex or an estate, you might be wondering if you need to get property insurance yourself or if that’s something covered by your levies. This depends on what kind of unit you own. If it’s a sectional title, which is usually a flat, apartment, or townhouse, the body corporate will probably insure your home on your behalf and the premium will be included in your monthly levies. If your place is freestanding, usually a cluster home or house, it will likely be up to you to obtain your own insurance. Don’t make the mistake of thinking the body corporate will get cover for you. If you do, you won’t be able to claim if something happens to your home.

 

Insuring a business property

If you’re looking to insure a building for business purposes, your needs will be slightly different to those for a residential building. There might be expensive equipment, machinery, and materials that could ruin a business if they got destroyed. That’s why some business property insurers will cover these items if they’re damaged by an issue with the building.

Property insurance for businesses will often also cover business interruption when your building is damaged, so you can rely on income even when your operations have temporarily ceased.

Some will even cover you for a portion of lost rental if you lose a tenant due to an issue with the building.

 

Insuring your property for the right amount

Insuring your property for the right amount isn’t as simple as covering it strictly at its market value. The quality of the finishes must also be taken into account because of the costs to replace them.

If you over-insure, you’ll be wasting money every month paying a higher premium because you won’t get an extra payout if you claim. If you under-insure, your property insurance provider will pay you out for a portion of your claim and not the full value of what the property is worth. If you insure for 50% of the actual value of the property, you will be paid out only 50% of the repair or replacement value.

It’s also important to review the insured amount every year or so because the value of your home will increase. Your policy should always reflect its current value. 

 

Is property insurance in South Africa a legal requirement?

The law doesn’t require you to have property insurance, but most financial institutions will only give home loans on the condition that buildings insurance is taken out on the property.

 

How to claim on your property insurance 

If disaster strikes, you can be certain your asset will be covered when you have reliable property insurance, like ours. With Dialdirect, you can submit a claim by calling us, on our website, or via the Dialdirect Insurance App. Make sure you do so within 30 days and have all the facts and details of what happened at hand.

We might send an assessor to calculate the extent of the damage, after which we will let you know the outcome of your claim. If it’s approved, we will pay you out the amount stated on your policy to repair or replace what has been damaged, lost, or stolen.

 

Property Insurance quotes in South Africa

Whether residential or business, we offer affordable Property Insurance quotes for all types of buildings. Get a DIY Dialdirect Property Insurance quote online and you can adjust your excess in relation to how much you’d like to pay monthly, tailoring your Buildings Insurance to your exact needs. Remember, if you get stuck or would like to clarify anything about your cover, simply call us on 0861 555 580, and a friendly consultant will give you all the info and help you need, so you can be certain of the cover you’re taking out.

 

Dialdirect is an authorised FSP and Insurer T’s and C’s online

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