Tragedy reminds property owners to check insurance cover

by Bertus Visser

Tragedy due to gas explosions struck twice within days of each other in July. In the first incident, several buildings were destroyed when a truck that was carrying gas through the small town of Worcester exploded, and in the second incident in Olifantsfontein, a chemical gas explosion at a business premises resulted in 50 people being hospitalised.

Freak accidents like these highlight how unexpectedly you may need to rely on your insurance cover and how important it is to ensure this safety net is correctly in place.

Anyone who owns a property should ensure their short-term insurance cover is up to date. Building sum insured estimates that are too low, or contents that are underinsured may prove costly should something unexpected happen. Ordinarily, insurance would cover for such freak accidents, within terms and conditions, but only if you’ve got enough insurance cover in place.

If your property is worth R2 million as a replacement cost – factoring in rebuilding and other costs in a loss – but you’ve only insured it for R1m, you are 50% underinsured and consequently risk having claims only paid out by 50% or repudiated altogether.

If you’re a business owner, you need to consider your third-party liability and if your policy covers you for business interruption. There could be costs you can’t maintain without being able to operate as usual, so factors like these need to be considered upfront and built into your policy for the protection you need, depending on your circumstances.

Part of staying covered is maintaining your property and vehicles. Faults you may have noticed should be addressed soon, and regular services conducted.

You should have your gas appliances and facilities inspected every five years and have a new compliance certificate issued – certificates are usually valid for five years. Any aspects of your home or business that could do with a service should be seen to as soon as possible, to avoid unnecessary fire risks and consequences that can follow.

Remember that countless goods contain flammable chemicals, while those containing non-flammable chemicals can come in combustible packaging. Each carry the risk of fire if not properly handled or stored. Cooking sprays, chemicals for swimming pools or spare gas canisters are examples, and the potentially flammable items in a commercial setting are endless.

A gas explosion – or even just a fire – can have dire consequences, including chain reactions and rapid spread potential, causing personal injury. Commercial properties carry a lot of risk, particularly industrial or businesses in manufacturing.

The true value of having the right adviser is often revealed when it comes to claiming, so avoid finding out that you’re underinsured once it’s too late. Recent events evidence just how easily things can go wrong, and without insurance, how costly the losses could be.

Having an adviser means you will be able to prepare adequately and assess the cover you need for your particular circumstances. An adviser can also assist you to have a robust financial plan that includes sufficient medical cover, protecting you financially and physically against the unexpected.

Bertus Visser is the chief executive of distribution at PSG Insure.