Contents Insurance

Contents insurance can be defined as insurance on all your possessions in your house that are not part of the actual structure and can be moved. Do not get confused with Householder’s Insurance, it is just another name for the same product. Homeowner’s Insurance on the other hand covers your house and outbuildings itself.

When you think what should be insured as contents think everything in your house that can move—furniture, electronic equipment, appliances, jewellery, clothing, documents, books, CD’s and DVD’s, special collections, paintings, sports equipment etc. Insurers will, however, place limits on individual items and these limits may be lower than current replacement costs. When it comes to unusual and more expensive items you may have to individually specify these in your policy. You will pay extra for all your specified items so talk to your broker or insurance company, don’t assume your Venetian cut glass is covered.

Anything covered under your contents insurance must be valued at replacement value that is what it will cost to replace the items at today’s prices. The best way to do this exercise is to draw up a full inventory, room by room, of all your contents and then to assign replacements values to it. From there you can, in consultation with your insurance broker or insurance company representative, decide which items should be specified. But these items need to be specified in the All-Risk Section of the policy.

Household contents also cover items that are in your possession when you are outside your home. Think of your jewellery, that special jacket, your laptop, cellphone or your children riding around on their bicycles. What about the content of your handbag or purse?

Another example we can use is sports equipment or musical instruments. If you are a keen golfer you will know the cost of a good set of clubs. Your insurer may set a maximum limit on what they are prepared to insure golf clubs for. But you have spent an additional small fortune customizing your golf clubs to your specifications. If you leave the golf clubs as part of your general non-specified insurance, you will be under-insured and should you loose your clubs will not be paid out for the full value. You therefore list your golf clubs with as much detail as possible as a specified item, you will pay an additional premium monthly but at least you will be able to have a customized set made again in case of loss.

Specifying items of value to you can save you unnecessary trauma when you need to claim. Don’t forget about items of value you may keep in your garage or outside storeroom. Keep your receipts every time you purchase any high value item. You can even take photographs of these items and keep them with your inventory, which you should store away from your home in a safe place.

Insurance companies are not all the same so you ALWAYS need to check the policy regarding specified items with your company. Some companies ask you to list everything over R1 000 under specified items, others may have a limit of R1 500.

Any valuables that you take with you on holiday, business trips, or even during an ordinary day should be listed as specified items under the All Risk Section of your policy. As soon as they leave the house they are not covered unless specified. All Risks covers the specified items everywhere, even overseas.

If you have a special collection of paintings for example and you do not know the value, it may be in your best interest to pay for the services of a professional valuator who will provide you with a certificate for insurance purposes. Reputable jewellers will do the same with your jewellery.

The following could all fall within the All Risk Specified Section:

  1. Jewellery valued at more than R1 000 per item
  2. Clothing items such as leather jackets, designer pieces
  3. Cellphones
  4. Handbags and purses and the contents thereof
  5. Photographic equipment such as cameras, video equipment
  6. Prescription glasses, contact lenses, designer sunglasses
  7. Computer equipment that is portable such as laptops, notebooks, palmtops and other computer accessories
  8. Sporting equipment such as golf clubs, fishing gear, canoes, paddle skis, cricket bats
  9. Musical instruments such as guitars, saxophones, clarinets
  10. Bicycles
  11. Babies prams and car seats
  12. Portable sound equipment
  13. Expensive camping gear

This list is not exhaustive but should get you thinking.

Once you have drawn up your inventory and list of specified items you should get a number of quotes to compare. Remember that if you insure your car on the same policy you will get a special rate.

If you want to get a peaceful night’s sleep, make sure you are sufficiently insured.