Home Insurance - How to make the correct decision
“Home insurance isn’t a luxury, it is a necessity for every homeowner.”
Home insurance in South Africa is a big deal. You are working hard for what you have in your home. Hold on a moment, you have worked hard to have a home and to become a homeowner! And you need to have a way to protect everything that has value to you. Home insurance is the way to get the protection that you crave.
Betty wasn’t as clever as you are, she didn’t think that having home insurance was important. In fact not only did she not have any contents insurance for those things within her home, but she also didn’t have any home insurance for the building itself! So when the fire on the mountain, caused by extreme dryness and incredible summer heat, swept down the mountain and engulfed her home, Betty lost all of her earthly possessions. Except her car. She had luckily just signed up for car insurance after reading about the dangers of driving on South Africa roads.
Having property insurance for your abode is so important. It is your financial backup in the event of losing everything. Home insurance can cover fire damage or destruction, flooding, and theft of your home contents. Are you ready to take a journey through the world of home insurance? Are you ready to have this type of insurance cleared up once and for all? You have found the right article, I am going to guide you through the world of home insurance!
5 Tips How to Save on your Home Insurance!
- Raise Your Deductible.
- Maintain Good Credit Score with your insurer
- Bundle Your Insurance policies under one premium
- Continuously ask for Discounts
- Shop Around for the best deals
- Reinsure your house annually
Only 10% of all homes in South African is insured!
"Let’s begin at the best place…the beginning"
- So it should come as no shock that home insurance has not always been around. Our ancestors didn’t have the option of signing up and paying monthly premiums for the protection of their homes. And maybe that is a good thing considering the lives that they led and the dangers they had to compete with. We are the lucky ones. We have this option available to us and it is affordable enough for even the most penny pinched of the population.
- Homeowners insurance provides coverage for the private residence. It provides coverage for accidents in the home, such as a burst geyser, and it provides protection against theft and acts of nature such as floods and fire.
- Imagine you were living in New Orleans at the time of Hurricane Katrina. The flood damage to homes was total and this hurricane had the power to transform home insurance in America forever. The incredible amount owed to those who had lost their homes meant that insurers couldn’t make good on the policies of the insured and so many New Orleans residents received half of what they were insured for.
- But they were the lucky ones. Those who had no insurance cover were left homeless, completely destitute after the flood waters had receded. This was a bittersweet moment for those with coverage as they were lucky enough to start trying to rebuild, while those with no coverage were forced to look to other options.
- Why is the story of Hurricane Katrina relevant to us? Well it goes to show that even minimal insurance coverage for your home is something in your pocket when life throws you the sourest of lemons. While something causing this extent of damage is unlikely to happen in South Africa, there is always the possibility of you waking up to a burst geyser and a flooded home.
- But where did modern home insurance all start? In America of course! The first policy for home insurance was introduced in September 1950 in the United States of America although similar policies were available in the United Kingdom. Before September 1950, people had the option of buying separate policies to cover the various possible damages that could be done to their homes. This wasn’t user friendly and it meant a whole lot of unnecessary paper work so it made much more sense to combine all of the coverage into one policy package and sell it like that.
- That is the basics of what home insurance is and where it all started. Since then household insurance has gone global and for some it is an insurance that is second only to car insurance.
The types of Household Insurance and what they include
- Just as a car owner has a few options regarding what types of car insurance they can buy, homeowners also have a choice regarding their residence’s insurance policy.
- The first question that they have to ask themselves is how much coverage they feel is necessary for their homes and their home’s contents. You need to decide if you need enough to cover your home and your belongings and self-protection to cover you in those cases when you are liable for damaging someone else’s property.
- Financial protection of your biggest asset as a homeowner is essential in these uncertain financial times when things can go horribly wrong. And if you are a homeowner who has bought a home using a home loan you are going to need that insurance even more. Imagine you have just bought your first home and it burns to the ground, like Betty from the story above.
- If you have bought that home using a home loan and you didn’t have home insurance or content insurance, you will not only have lost everything you own but you will also have to pay back the home loan that you owe to the financial service provider.
- ....In so many ways it just makes sense to have home insurance. But let’s forget the worst case scenario for a moment. The chances of your home being completely destroyed is very slim. The possibility of something within your home being damaged is something that is a whole lot more likely to happen. Like the geyser story. When that happens the fees to have the geyser replaced can be so incredibly high that forking that kind of cash out of your back pocket is a feat impossible to most. Homeowners insurance will also cover the loss or damage to physical structures within the home such as built-in cupboards, toilets and baths.
- Home insurance is usually divided into two sections; contents insurance and building insurance. It’s quite self-explanatory, the contents insurance provides the insured with coverage for all of the items within the home including clothing, furniture, electronics and even works of art. In the event of your electronics being hit by lightning and destroyed by a power surge, you will be covered. Should someone break in and steal your belongings, you will be covered. And if your valuables are destroyed in a fire or a similar act of nature, you will also be covered. Not all people opt into this insurance, but it is nice to have if you have expensive or priceless contents in your home.
- The other household insurance will cover your building. This means that the physical structure of your home will be covered for any damage or the complete destruction of the building. Damage caused by burst pipes, damage caused by alterations, damage caused by storms or even broken windows, can all be claimed from your household insurance when your building is covered.
"The types of Household Insurance and what they include"
Just as a car owner has a few options regarding what types of car insurance they can buy, homeowners also have a choice regarding their residence’s insurance policy.
The first question that they have to ask themselves is how much coverage they feel is necessary for their homes and their home’s contents. You need to decide if you need enough to cover your home and your belongings and self-protection to cover you in those cases when you are liable for damaging someone else’s property.
Financial protection of your biggest asset as a homeowner is essential in these uncertain financial times when things can go horribly wrong. And if you are a homeowner who has bought a home using a home loan you are going to need that insurance even more. Imagine you have just bought your first home and it burns to the ground, like Betty from the story above.
If you have bought that home using a home loan and you didn’t have home insurance or content insurance, you will not only have lost everything you own but you will also have to pay back the home loan that you owe to the financial service provider.
Easy Tips for finding the right home insurance
A quick breakdown on how to find your perfect insurance policy :
When you have just become a homeowner for the first time finding the right home insurance will suddenly become very important. You know how much of a financial investment having a home is going to be, you know how much of your monthly income is going towards keeping the roof over your head while also keeping up with the maintenance that needs to be done. Should something happen to your home, you want to know that the insurance you have chosen will be sufficient enough to cover you in the event of something happening. So what tips and advice can we here at Insurance Directory give you to find that ideal home insurance? Read this!
1.Compare your options
Insurance is a competitive industry and with so many companies offering cover for your dwelling, picking through the options can be a difficult thing to do. The more information that you have when you are shopping around, the more success you will have. Your credit history might have an effect on your insurance options, because having home insurance is more of a financial risk for insurers, but it is still making comparisons to get a general idea regarding the types of insurance and the perks and benefits it will have is a good place to start.
Get at least three home insurance quotes before you settle on a final choice. This will give you a general idea about what you can expect from other home insurance quotes when you receive them.
2.Consult the experts
When you feel that you need more information or when there are things that you don’t understand there is always the option of consulting an industry expert. You don’t always have to buy the insurance through the expert or ask them for home insurance quotes, sometimes it is best to just talk to them.
Make sure that you understand the policy
Home insurance quotes can be full of complicated lingo that is boring to read and doesn’t make a whole lot of sense. When looking at house insurance policies research the terms used so that you know exactly what it is that you are looking at. Making sure that you understand what you are going to be paying will mean understanding what you are being covered for. So read all of the documents you are given along with your home insurance quotes and make sure you understand and agree with them before you take the process any further.
3. Regularly review your policy and compare it with similar policies
This is a tip to keep in mind after you have bought an insurance policy. Each year your insurance premiums will increase. So why should you be paying more for your insurance when you can be paying less while enjoying the same insurance coverage for your cottage, flat or homestead? Home insurance premiums change from company to company each year and it is up to you to each year make a point of comparing what your current coverage is with what you could be having, and paying less for.
Avoid the fraud, there are sure to be many insurers who make things sound too good to be true and end up scamming you. Always buy your policy from a reputable insurance company, this way you know that you are not being scammed. And if something sounds wrong, or if there are holes in the policy, either walk away or consult with a professional. Your time and money is valuable and you certainly don’t have time to waste on those who want to rip you off…am I right?
Did you know that 1 in 4 people can save on their insurance simply by comparing it with other insurance offers
Quick bonus tip for contents insurance
If you are looking at a homeowner’s insurance policy, chances are you have stumbled upon the contents insurance and might be thinking that having this type of insurance isn’t such a bad idea. Contents insurance will enable you to have cover for everything in your home, for example should you laptop be stolen or destroyed in a lightning storm, your contents insurance will financially protect you.
If you decide to buy contents insurance, make sure that you photograph the valuables within your home and keep these photos safe. This will make the claim process a whole lot easier, should you have to make a claim. It can also be a good idea to keep a copy of the items in a safe place away from your property. Should your home be destroyed in a fire you will have a copy of the photos all of your contents in another place. Home insurance is a necessity and while you cannot afford to cut corners on what you will be covered for you can find insurance that will be a cheaper option but provide a full coverage.
Your guide to home insurance in South Africa is now over, but the journey has just begun. Are you keen to start looking for insurance? You are in good hands with us. Insurance Directory provides you with a time saving, free platform on which to find great insurance companies and compare policies and prices. Your journey to discover all types of insurance begins and ends with us.
3 Tips on Saving Even More on your Household Insurance
- Make Your Home More Disaster-resistant to reduce your premiums
- Enhance your security to lower your premiums
- Review your insurance portfolio annually