Why you absolutely need buildings insurance
Buying up some property? Good for you! Basically, you’ve just landed yourself one of the most expensive purchases that the average person can make in their lifetime. It’s a big deal, not only because of the price tag (ka-ching!) but because the financial responsibilities of anything going wrong with your new house are yours, too.
That’s why you need to get your hands on buildings insurance as soon as you own any kind of building. This type of insurance covers the permanent, built structures on your property… Like your house and its outbuildings.
It makes sure you don’t have to panic when the structure of your building gets damaged from natural disasters like fires and floods. It’s also invaluable when it comes to damage done to fittings, fixtures and improvements, so you’ll be covered for loss or damage caused by leaking, bursting or overflowing heating systems, geysers and pressurised water pipes.
That’s serious money. And that’s why buildings insurance is an absolute must. We actually have four more concrete reasons why you need it, so settle in.
Reason 1: Your bank says you have to get it
Very few among us buy property without some assistance. Sometimes that help comes from your parents (if you’re lucky). Most of the time, though, you’ll need to get a home loan from the bank who’ll make it a requirement to get insurance. They’ll probably even offer you their own insurance, which can be easier. Just keep in mind that the bank only has to cover itself, so while it might be better to use your bank as a one-stop shop, it’s also a good idea to look around for better cover and lower premiums.
Also, some people might not know this, but you’re under no obligation to get buildings insurance through your bank. You have the freedom to choose your own insurer. Your bank may not be satisfied with the level of cover you get (meaning that you have to up your coverage with your insurer), but you still have the right to choose for yourself.
Our top tip is that you should compare costs, level of cover, benefits, reputation, and service from three accredited insurance companies so that you can get buildings insurance that you can afford and trust.
Reason 2: Crime is on the rise
Around three years ago, it was discovered that home burglaries are the third most common crime in South Africa. It seems that burglars are getting more innovative in how they get in, even going so far as to work around the specific design of your house to break in. For example, if they spot sliding doors, they’ll lift the doors off the rails and cause damage that you’ll have to pay for. You might even have to replace the sliding doors altogether, which isn’t covered by home contents. You see, home contents insurance is just for the stuff inside of your home. Not the structure, fittings, and the like.
Apart from the trauma and loss, these kinds of incidents also cost a lot, often far more than you expect because usually there’s a labour fee that needs to be included with the bill. The best way to protect your home against damage is to take out comprehensive cover that insures your home against burglaries and the damage that they cause.
Reason 3: The unexpected tends to happen
Life is full of surprises and not all of them are pleasant. Something could happen to your house, like a tree falling through your lounge window, taking out a supporting beam and crashing many walls and parts of your roof. That’s a lot of damage and a lot of moola. A lot of moola that has to come out of your pocket unless you have buildings insurance to cushion the blow.
Does it seem like this kind of incident is far from likely? Well, it’s just an example and actually… It has happened. And you can’t predict when something similar will happen to you. Nobody plans for malicious trees to crash through the roof or for their geyser to burst. In fact, insurance is precisely for unforeseen circumstances and because your home is probably your most expensive asset. You need to be prepared.
It’s far better to plan for every eventuality by getting cover so that when a crisis hits, you have insurance in place to help you through difficult times.
Reason 4: You want to sell your property in the future
Maintaining a home can be expensive, and when unplanned events occur, like a burst geyser that destroys your parquet flooring, you might not have the financial resources to get everything back in tip-top condition. Damage that goes untended because you don’t have the cash (or the insurance) to take care of it could make the problem worse over time. But with buildings insurance you’ll have a financial lifeline that’ll help you safeguard your assets and protect its financial value. This means that you can charge the maximum amount for your property if you ever want to sell it.
Your next step
If these steps have won you over (and they seriously should have), then your next step is to get a buildings insurance quote so that you can insure your property for what it’s worth. You also want to make sure you cover it for its correct replacement value. (Hint: The replacement value is the amount that it’ll cost, at the time of your claim, to repair or rebuild your property from the foundations up.) This amount includes big things like your boundary walls and swimming pool, and small things like taps and fitted carpets. It also includes other kinds of costs that you might not think about, like demolition charges and waste removal.
Why are we hammering on about the correct replacement value? Well, because if you’re under-insured, your insurer will only pay a pro-rata amount, which is insurance talk for you getting paid out a lot less than you’d need to get back on track.
Ultimately, buildings insurance isn’t something you want to be without. You can’t control theft or natural forces, like lightning strikes and overflowing rivers… These things do happen and have left many people stranded with no idea of how they’ll be able to pay for it all.
Get a super cheap, comprehensive quote from a reliable South African insurance company who has your best interests at heart today.