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While the broad concept of insurance is generally understood as the process of purchasing cover for your valuable possessions to indemnify you in the event of loss or damage, it requires thorough understanding of the agreed contract, says Attie Blaauw, Head of Personal Lines Underwriting at Santam.
“As an insured consumer it’s important for you to have a thorough understanding of what is covered under your home and vehicle insurance policy and what is not. Many people also do not realise that as a policyholder they agree to specific terms and conditions and have a responsibility to uphold their end of the contract. Furthermore, purchasing cover without properly maintaining your assets presents certain limitations.”
Blaauw says wear and tear of certain items and how this is accommodated, if at all, in one’s policy is another important factor of which to be aware.

PRINCIPLE OF INSURANCE

First off, when defining insurable risk, Blaauw explains that insurance is simply a risk transfer mechanism that offsets loss of, or damage to, insured property. This loss may arise due to exposure to a known and agreed risk, such as fire or theft. “The aim is to indemnify or compensate the insured party by placing him/her back in the same financial position he/she was in before suffering a loss or damage,” says Blaauw.
He continues that the principle is based on consumers paying a premium to an insurer to cover specified types of losses or damage to their property. These losses must be caused by a sudden and unforeseen event. The paid premiums allow an insurer to compensate the client for the cost of repairing or replacing the lost or damaged items as set out in the policy contract.

WEAR AND TEAR

Blaauw says personal insurance policies are designed to respond to most risks of both natural and unnatural causes, such as fire or explosion, lightning, burglary, hi-jacking, earthquake, flooding, storm, wind, hail or snow. The focus, however, remains on sudden and unforeseen events.
Risks arising from a lack of maintenance and normal wear and tear are largely viewed as undesirable risks and are costs that should be budgeted for by consumers. He explains that there are typical exclusions in policy wordings that consumers should be aware of, such as gradual deterioration caused by poor maintenance, wear and tear, mould, discolouration, rising damp, rot, insect infestation, vermin, weeds, roots, etc.

PROPER MAINTENANCE OF ASSETS IS CRITICAL FOR GOOD CLAIMS EXPERIENCE

1. Mrs C claimed for damage to her freezer. The damage report received from the service provider indicated that the damage was due to the age (wear and tear) of the item and that no insured cause contributed to the damage.
2. Miss T claimed for water damage to the house caused by flooding. Upon investigation it was revealed that the paint was bubbling and peeling off, there was old mould on the walls and even mushrooms growing from the carpet, all indicating that the damage had not been caused by one single event but had occurred gradually over time.
3. Mr K registered a claim for cracks in his swimming-pool and alleged that they were the result of storm damage. An appointed engineer found that the cracks in the pool had developed over time because of the normal expansion and contraction of the soil due to an increase in moisture content and that no storm or other insured cause had contributed to the cracks in the pool.

Santam highlights the following maintenance areas relating to your home:

• Schedule regular leak inspections to prevent damp damage over prolonged periods.
• Apply damp proofing to walls to prevent possible rising damp.
• Seepage of water leaks over an extended period can lead to weakened foundations causing structural damage and collapsed boundary walls.
• Ensure checking for leak around and under appliances on a regular basis which may lead to damages to walls and floors.

• First and foremost, check that the fire extinguisher is serviced up to date and still fully functional (please check the note on the extinguisher).
• Fire extinguishers must be serviced within a year after use consecutively.
• Ensure that the lightning/thatch conductors are in condition in accordance with the instruction/regulations of the insurer.
• Lightning conductors must be checked and maintained on a regular basis.

• Implement a regular roof inspection schedule, focussing especially on areas with high wind reception, and checking after hard rain  downpours and windstorms.
• Check for any signs of termite or other vermin which may contribute to inferior state of your roof.
• Should you detect and brown or discoloured marks on your ceiling, it might be an indication of missing tiling on the roof.
• Regular trims of branches overhanging the roof is essential for the maintenance of your roof.
• It is recommended that roofs, especially flat roofs are sealed annually and if performed by a roofing specialist/professional the guarantee should be filed in safe keeping.

• Refer to your manufacturer’s service indicators to ensure that all services on pumps (borehole and swimming pool) and motors  (gate and garage door) are up to date.
• Prioritise safekeeping of proof of maintenance.
• Only contract reputable gas installers when installing gas, that can issue proof as a certified gas installer.
• Service all gas appliances such as geysers, stoves, and heaters according to manufacturers’ specifications.
• Fireplace chimneys and any other chimneys must be cleaned and inspected once a year. Failure to do so can result in smoke damage or worst case a fire.

PROPER MAINTENANCE OF ASSETS CRITICAL FOR GOOD INSURANCE CLAIMS EXPERIENCE
Source: Santam: RISK MITIGATION SERIES – PERSONAL LINES
SEPTEMBER 2022