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Household Insurance
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Household insurance is separate from securing your property. Even if you do not own your own home (perhaps you rent a townhouse or a cottage, for instance) you still need household insurance. Essentially, this kind of short term insurance covers the content of home against losses arising from events that are specifically listed in your policy. This might, for instance, include damage from burst plumbing theft or any other kind of loss. Usually policies exclude political contingencies (such as riots or civil war) and they might exclude so-called “acts of God”, such as hurricanes or typhoons. As always, it is important to read through the policy thoroughly and make sure you understand the exclusions very well before signing up for household insurance.

The good news is that household insurance is usually broad and covers items that might not be in the home when they are lost – items such as cell phones, cameras, luggage and sports gear. The definition of “contents of your home” usually also covers things in garages/store room, as well as garden furniture and other items outdoors.

These inclusions might, however, be subject to conditions. Household insurance is especially necessary in South Africa due to the large number of break-ins and petty thefts that occur each day. You would think that the premiums would be high for such insurance in view of the high risk. However, by shopping around you can find great deals on household insurance, particularly if you mitigate the risk by installing good-quality security gates, an alarm system and hire an armed response company that can rush to the scene of a crime being committed before the loss of the contents of your home occurs.

Virtually all household works on the basis of replacing the item that was stolen at the current replacement value. When you take out household insurance, you place a value on your household contents by insuring them for a particular sum. This sum, less any excesses which you may have to pay, is the maximum that your insurance company must pay you if everything is lost, stolen or damaged. It is advisable to take photographs of particularly valuable items such as antique rugs and works of art and file them safely. These might come in useful if ever you have to put in an insurance claim for these items. The existence of a photograph of the insured item in some cases even helps the insurance company and police recover the stolen goods so that a payout is unnecessary. Additional advice is to look after your belongings as if they are uninsured, even if you have household insurance. The more claims you put in, the higher the excess payments. In addition, there is a ceiling on payouts in terms of all household insurance contracts. So look after your belongings well.

Those who are seeking to save money on household insurance might decide to insure a couple of items only, such as television, DVD player and sound system. Unfortunately it is not possible to take out household insurance to cover only specific items. Neither is it possible to attach a monetary value to an item of sentimental value. Thus, if an old brooch can be replaced for R200 is stolen, the insurance company cannot pay out more than this to replace it, no matter how much the sentimental value. It is also not possible to insure unusual items, such the loss of your voice (if you are a singer) or the loss of your limbs (if you are a sportsman) under household insurance. However, specific risk short-term insurance is available for short periods or particular risks, under a separate policy. A useful tip is to ask for a household insurance quote from the insurance company that handles your home and car insurance. You might stand to get a huge discount by placing your household insurance business with them.

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