Exploring The Full Extent of Home Insurance Coverage

Most people spend more time at home than anywhere else. As a place to rest, relax and make memories, it’s the smart choice to insure this structure so that it remains your sanctuary. As a new homeowner, you may be exploring your Homeowners Insurance options for the first time. You could also already have Home Insurance in place, but suspect you're not getting the most out of it. Alternatively, you may be dissatisfied with your insurer and are exploring alternatives. Regardless of your category, Budget Insurance can help you explore what Home Insurance can offer. 

How do you read a Home Insurance policy?

Even if you have taken out the best Homeowners Insurance coverage for your needs, you'll still need to periodically review your policy to ensure it's up to date or after your coverage needs change. It's best to do an initial read-through as soon as you get your policy documents to get answers to any questions you have before your coverage kicks in. Here are some elements of your policy worth paying attention to:

• Your policy schedule — this states who is insured, how the policy will operate, what the insurer's obligations are and what your responsibilities are in terms of compliance. It will also include any declarations such as your official policy duration, applicable waiting periods, coverage start date and date of automatic renewal.

• Payments — These are the various payments your coverage will require you to make and what you can receive. This includes your monthly premiums, which can change based on your claim history (or lack thereof) or annual inflation. It also includes the maximum coverage in rands you'll receive for different categories of claims, including limits and any excess payable, which is the first amount payable before a claim is honoured.

• Coverage — This outlines exactly what parts of your property will be covered and if any exclusions or special additions exist. For example, most Property Insurance products include your home's physical structure but can include garden sheds, outdoor recreational areas and boundary walls.

• Claims — This section outlines your insurer's required process for making a claim, including forms you must fill in, submission deadlines, and any factors that can result in an immediate claim rejection.

The key components of Home Insurance

In South Africa, Home Insurance can refer to Building or Home Contents Insurance, or both. A combination of Building Insurance and Home Contents Insurance is recommended for the most comprehensive cover. The former will protect your home's physical structure and function, including its installed or immovable elements. The second covers everything in your home that you could move should you relocate to another property, like furniture and kitchen appliances.

Learn more about The Differences Between Building vs Home Contents Insurance. 

With the South African Police Service reporting a rise in home robberies in 2023[1], having both policies is essential. If you frequently travel with important belongings, adding Personal Possession Insurance to your coverage is also worth considering. This will compensate you for your belongings should you lose or damage them outside the home.

Understanding insurance policy limits and deductibles

All insurance policies have limits and deductibles to encourage you to use your insurance responsibly. These factors also keep your insurance affordable so that you're only covered for what you actually need. A deductible or excess is the amount you'll pay before your insurer covers you, meaning that any repairs or replacements to the value of your excess or below come out of your pocket. A higher premium usually equals a lower excess and vice versa.

Additional cover and endorsements

No two homes will be identical, and you may, over time, modify your house to meet your needs better. As it would be impossible to create one insurance product that meets everyone's needs at one affordable price point, insurers offer customers additional coverage via add-ons to customise their insurance to their exact needs. For example, Budget Insurance offers geyser insurance. This is a good addition if you've recently upgraded or replaced your geyser and want to keep it functional for years to come.

Debunking some common Homeowners Insurance myths

Here are a few Property Insurance myths that may be keeping you from getting the most out of your coverage or seeking an insurer better able to meet your needs:

1. Home insurance is required by law— While no law makes this mandatory[2], if a banking institution finances your home, your home loan provider may require this as a condition of your contract.

2. Home insurance is expensive — Budget Insurance offers affordable and comprehensive coverage that suits your budget. What you pay will depend on what you cover and what excess to premium arrangement you've opted for. 

3. Home insurance covers all weather damage— Some insurance policies do not cover all forms of weather damage, like flooding. It’s best to check with your broker for clarity and to understand the extent of coverage in your policy. If necessary, you can opt for add-on coverage for special risks. 

Get a Home Insurance quote with Budget Insurance

Now that you know more about why it's important to understand your Homeowners Insurance policy, you can make informed decisions about the type of coverage you need. Budget Insurance can provide some of the best Home Insurance options for all your needs. Contact us for a Home Insurance quote today to kickstart the process.