What were South Africans most common building-related claims in 2020?

The primary cause for home insurance complaints during 2020 was the rejection of claims. When things go wrong, people want a fast, seamless claims process, with a positive outcome at the end. It can be devastating to deal with a mishap, only to discover inadequate cover to repair what went wrong. It’s imperative to check a policy is up-to-date and adequate annually and to know what’s excluded, particularly when it comes to common events like geyser, storm and power surge claims.

According to the Ombudsman for Short Term Insurance (OSTI), complaints about rejected claims increased by 17% in 2020 “and continue to be the main basis for consumer dissatisfaction in homeowners’ insurance coverage. “Policy exclusions for damage caused by defective design, construction or workmanship, wear and tear, as well as a lack of building maintenance are the common cause,” states the OSTI.

According to Rowland Ramalingam, Head of Non-Motor Claims at Santam Insurance, this points to a knowledge gap when it comes to taking out building insurance.  “People need to protect themselves by being informed. It’s critical to know the things that commonly go wrong and cover oneself against these. Proactive risk management is crucial.”

Ramalingam says Santam saw a surge in geyser, storm and power surge claims in 2020, while burglary claims dropped. This is likely because people were at home, due to the successive lockdowns. Santam data for 2020 shows the most common claims included:  

• Water tank, apparatus and pipes (mostly geyser claims)
• Special perils (defined as storm type or hail claims)
• Accidental loss (accidental damage to fixtures and fittings e.g. stove tops)
• Lightning or thunderbolt damage (decreased in 2020)
• Power surges (30% increase on claims)  
• Theft and Burglary (decreased in 2020)
• Fire damage 

He stresses that building insurance can be just as important a consideration as home contents insurance. Home contents insurance covers a home’s contents. Building insurance covers the physical building. “Building insurance is essential to protect you against loss or damage, in the case of a fire, earthquake, severe weather or other disasters like a burst geyser.”

He adds that repairing or replacing items like geysers almost always adds up to more than one estimates, “If you don’t have insurance, it’s wise to have some kind of saving for when the curveballs come. For example, the average cost to replace and install a geyser can be anything from R7 500 to R10 000! Usually, that’s a lot more than people think.”

A good building insurance policy should provide comprehensive cover for a residence, including the boundary wall, paving, garage and gate (plus gate motors), the swimming pool, borehole (and pumps), any outbuildings like a garden shed, and the structure of the house and its fixtures and fittings.

Ramalingam concludes, “When things do go wrong, Santam has four quick and easy ways to submit a claim, to maximise convenience. This is why consumers and intermediaries voted us the most reliable personal insurer when it comes to paying claims. You can claim online via our site, use the Santam app, dial our 24/7 claims line (0860 505 911) or use the online directory to chat to a broker to help with the claim on your behalf. Of course, prevention is better than the cure, so it really is crucial to check your insurance meets your needs. Try our building calculator to make an inventory of the structure on your property. Or consider having a professional risk assessment done.”