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Despite ongoing economic uncertainty worldwide, owning property has been a way to accumulate wealth and establish financial stability. However, as owning a house also implies several financial obligations, the necessity of taking out homeowners insurance in South Africa cannot be denied.

The issue of insurance is especially relevant, considering that although South Africa is not rife with natural disasters, houses are still prone to damage from fires and flooding, not to mention vulnerable to burglary and vandalism. Homeowners insurance is therefore essential, as it all damages and losses to property that are a result of theft, fires, flooding, or any other natural disasters.

According to an article on www.insurance.za.org entitled “Homeowners insurance cover”, many homeowner insurance policies offer essentially the same cover. However, the article states that there are in fact several different types of homeowner insurance, and some insurance policies may not cover everything grouped under the umbrella term “homeowner insurance”. Companies that offer bonds, mortgages and home loans require that you take out homeowner insurance cover, so be sure to make certain exactly what your particular policy covers.

The concept of homeowner’s insurance may seem straightforward to some, however, the article states that although most people have taken out homeowner’s insurance cover, not many people are aware of the difference between homeowner and household insurance.

Therefore, to clarify, homeowner’s insurance cover provides financial cover of the actual buildings of your house, including outbuildings, detached granny flats, work sheds and swimming pools. An insurance policy of this kind will provide homeowners with payouts equivalent to the insured value of the property, in the event of damage. Household insurance on the other hand, focuses more on the security of the home, and covers theft and damage from natural disasters.

Coverage for vandalism is often included in homeowner insurance policies, and these policies also sometimes cover plumbing damage. Premiums are calculated in consideration of a number of factors, including the location of the property, the condition of the house, the total value of the house and the amount of excess the homeowner is willing to pay when claiming from insurance.

 

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