Insurance Find

Archive for the ‘Best Insurance Policies’ Category

 It is a good thing to be aware of the ‘average’ clause in a policy which companies can apply if they can prove that you have been drastically under-insured. Indemnity insurance in particular is something to be carefully scrutinized.

In the event of you having to put in a claim they will pay out substantially less than the insured amount.

For example if your house is insured for R200 000 but the company can prove that your home is worth, say R300 000 you will find that you are under-insured. If you then claim for damages of R40 000 they may decide that you must carry some of the loss and will pay out just over R26 000 which is about 66% of the claim, and the same law of averages can also be used as a yardstick for under insured claims.

It is not a good idea to underinsure your valuables as this could only lead to trouble. But on the other hand over-insuring will only prove to be wasteful and unnecessary as claim pay outs will only replace at the value of the goods  – in other words at current retail prices. With an indemnity insurance policy from a reputable insurance company this can avoided.

For example if you have goods that need to be replaced and the goods are R6 000 and the replacement is only R5 000 this is what the insurance company will pay out as per the indemnity insurance contract.

It is best to do a regular inventory of your goods, and utilizing the services of a professional evaluator might be beneficial if you need accuracy on the value of your assets. It is through this that you can get the best out of your indemnity insurance.