As financial concerns loom large, reassessing your insurance needs could provide not only peace of mind but also a more manageable financial future.
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Economic instability and rising living costs are weighing heavily on South Africans, according to the TransUnion Consumer Pulse Study Q2 2024, which showed that 77% of consumers rank inflation on everyday items as their top financial worry, followed by interest rates (55%) and job security (52%).
Due to these financial pressures, it is a good idea to reassess your insurance and check that you are getting the best value for money while still protecting your car, home, and belongings.
Wynand van Vuuren, client experience partner, King Price Insurance, offers practical ways to ensure that your insurance is comprehensive yet affordable.
Having an understanding of where you are most vulnerable to financial loss is the first step to adequate insurance coverage.
Ask yourself how you would cope if your car was involved in an accident or if your home suffered fire damage. Could you afford the repair costs out of your own pocket?
"Some people opt for reduced cover on their cars to save money, but this potentially leaves them unprotected against accident damage, which is the most common type of claim we see," Van Vuuren said.
Review your insurance policy thoroughly.
Are you still paying to cover items you no longer own? Is your jewellery locked away in a safe and never worn outside? Do you still have shortfall cover for cars that are already paid off? Has your vehicle aged a year, but you’re still paying last year’s premium? Do you work from home, making your house more secure because it’s always occupied?
By being able to show that you pose a lower risk, you could qualify for a reduced premium. You could also lower your premium by installing a tracking device in your car or upgrading the security of your home.
Ensuring that your home contents are insured for their current replacement value and not what you originally paid for them is very important.
High-value items that are stored inside your home are covered under your home contents policy, but as soon as you take them off your property they must also be covered as portable possessions. This includes items like your phone, laptop, jewellery, sunglasses, watch, and gym bag.
For insurance purposes, the value of your home is not the same as its market value or what you bought it for, according to van Vuuren.
Make sure to insure your house for what it would cost to rebuild right now, including aspects like foundations, perimeter walls, swimming pool, solar panels, taps, and tiles.
If you have made any major improvements to your home, then it is wise to increase your value, to avoid the risk of being underinsured.
If there have been changes in personal circumstances, ensure that you inform your insurer.
This can include changes to where your car is parked (day and night) or how many kilometres you drive each month which can significantly impact your premium.
Insurance companies often offer discounts to clients who hold multiple policies with them. For instance, you can save money by insuring your buildings, home contents, and car with the same insurance provider. Some insurers will also offer discounts for covering multiple cars.
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