Category Archives: Building

How does Home Insurance work in Sectional title Units?

A Sectional Title Unit is made up of a section of a building or different buildings.

When you buy a sectional title, you purchase a section as well as an undivided share of the common property.  This “share” is the communal gardens, paving, etc.

You only own the inside of your unit, and everything outside this unit is part of the common property.

Due to the rise of crime in South Africa and the heightened security of complexes, sectional title living has become exceedingly popular.

Sectional title Units – who Pays, the Body Corporate or You? 

Sectional title

So how does insurance work when  a lot of what you own, the Body Corporate Insurance Policy covers?

Who pays, you or the Body Corporate? The truth is that every owner in the complex pays part of the cost of insurance.

The premium each month is included in the annual budget and paid from the owners’ monthly levies. The body corporate will have insurance cover against weather-related damage to the buildings such as flooding.

People who live in sectional title units must understand what their cover is in the body corporate’s policy and whether they need to insure their household goods separately.

Sectional title – Who Pays the Excess

The body corporate must implement a claims procedure so that owners know what to do in the case of flooding, etc. It is the owner’s responsibility to claim via the body corporate to ensure its legitimacy.

There may be an excess amount due, and according to the Sectional Title Act, the owner will be responsible for the excess payment.

You’re Responsible for what’s Inside

The body corporate doesn’t cover the contents of your particular unit but is essentially just a bricks and mortar type of insurance.

Every tenant, whether renting or owning a unit, has to take out an insurance policy to cover their personal items.

The trustees must ensure that all tenants understand who pays for what and who will pay the excess in the event of a claim?

Sectional title Living is Communal

Many owners of a sectional title believe that the body corporate’s insurance policy covers their unit and everything in it.

Before you invest know what your responsibility is and what it isn’t to save yourself financial loss and unhappiness.

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Building Insurance increases Financial security

You might wonder why you need building insurance.

Most of the time, we think that having a fitting replaced or structural damage repaired, will not cost that much.

After all, there is always an out of work handyman available, and the cost of materials can’t be that expensive.

Think again!

The reality of the costs involved around building repairs might leave you quite astonished, and the single reason why insurance is crucial for any homeowner to have.

What exactly does a building Insurance Policy cover?

Building InsuranceMost of the well established short-term insurance companies like Santam, Mutual & Federal, Discovery Insure and Momentum offers building insurance at competitive premiums.

Covered in a building policy is insurance against damages like broken geysers, theft, burst water pipes, fire, power surges, explosions and accidental breakage.

In some cases, accommodation is covered after an incident has left your house uninhabitable.

Check out This neat online Building calculator designed to Help you

Most insurance companies, like Outsurance, provide a building insurance calculator. This handy tool, which can be found on their website, allows you to calculate a total replacement value amount according to your home’s specification which can give you more or less an idea of how expensive repairs can be.

This calculated amount will put things in perspective. Each time you as a homeowner, wonder why a building policy is a necessity, you can think back on the amount the calculator worked out and be grateful for insurance.

It is compulsory to have building insurance in South Africa if you own a bonded home. You do however have the opportunity to have insurance with a Financial Institution from a bank or any other insurer of your choice.

Get a building insurance Quote online

Each online insurance company’s website allows a potential member to fill in and submit a form. That form goes to a consultant who will call you with regards to the insurance you require. Do not forget to get quotes and compare insurance quotes offered by banks like Absa or Nedbank.

Short term insurance companies

The good news is that most insurance companies can provide house insurance, car insurance, building insurance and life insurance which makes it easier for the consumer to manage.

In many cases, a member of an insurance company might give discounted premiums or bigger cash back incentives on insurance when a product is under the umbrella of one firm. It is therefore highly advisable to compare insurance quotes and see if there is a difference in price.

Always ask Questions if You are Unsure

When you get insurance quotes, including building insurance quotes, from different short term insurance companies like Momentum and Old Mutual, ask questions if you do not understand the conditions, or if you are uncertain about the information provided.

If you are curious as to which insurance company will provide the best building insurance premium, you can compare different firms’ quotations online with Hippo, one of the best online comparison platforms.

Complete and send the form to get a FREE insurance quote