Eve

Some say the only certainties are death and taxes. Nothing else can hold the same level of probability. This, however, does not mean everything else holds the same probability as the sun rising from the north!

There is always a chance of those other elements like sickness, Liverpool winning the English premier league one day and so forth though the likelihood of each of these happening varies from low to high. It is a great tragedy that often, most are caught unaware when these events happen, including death itself which as we mentioned is inevitable.

It is such a good thing to see people starting to appreciate the importance of having one’s possessions secure and protected. Inventions such as the electric fence keep out potential intruders, cautious driving reduces susceptibility to an accident, exercise reduces the chances of suffering a heart attack and so on. It is good that we can control all that is within our means, but what of those dangers that are not within our control? We can only predict their severity but cannot ascertain with exactness the extent of damage they will cause.

An Act of God (Vis Major/force majeure) is defined as a violent and catastrophic event caused by forces of nature, which could not have been prevented or avoided by foresight or prudence. Examples include hurricanes, tornadoes, floods and earthquakes. The probability of any viz major occurring depends largely on the geographical location, thereby leaving every area at risk of experiencing one. The SADC region and world at large mourn the lives lost and property destroyed recently by Cyclone Idai. As of 24th March 2019, the death toll was said to be at least 700 (excluding unaccounted for victims) and the infrastructural damage at least hundreds of millions of Rands.

Though Viz majors cannot be prevented, their financial impact can be lightened. Think of the orphans, homeless families, destroyed transportation network systems. Financial services players have joined arms and offered some form of relief and/or solace in the unfortunate event that these occur.

Insurers have designed products that will ensure one’s family is catered for in the unfortunate event of them passing on. These include life assurance policies that will pay out a lump sum to your dependents when you pass on to ensure they pay off any debts, continue with life and finish off their schooling and so forth. Though the money will not replace you, it certainly does assist the family with facing life without you. Medical aid schemes are there to cover you when you are sick/ill or injured. Funeral assurance will assist in the costs associated with the funeral arrangements after your beloved die.

Housing is a basic human right. Imagine what you would do after completing paying off the twenty-year-old bond only to lose the house to a flood, earthquake or cyclone. Insurance companies will indemnify you that is to be restored back to the same position one was in prior to a loss, under their various products in the event of such a tragedy happen. This extends to include all your other material possessions despite how big or small from luxurious cars to silverware.

The further relieving news are insurers will not only provide a remedy when viz majors occur but other unfortunate unforeseen events ranging from accidents, acts of other people, malicious damages and a host of others depending on the product sought. Furthermore, though insurance is a post-loss mechanism, underwriters will help identify the risk you are exposed to and aid you with some technics and advice on how to minimize the chances or impact of a loss.

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

There is a general assumption amongst most that when purchasing household contents insurance, they automatically get cover for all unforeseen accidental events. After all, insurance is meant to cover accidental incidents, right? This may be one of the reasons some have been left feeling hard-done when they presumably submitted valid claims which were subsequently rejected with the reason being “not covered”. This short article is meant to clear the air on the scope of cover in one’s household contents cover.

Generally, household contents cover is mainly meant to indemnify you in the event of any of the unfortunate and unforeseen losses:

  • Fire and Allied Perils (The allied perils usually include Storms, Floods, Lightning etc)
  • Theft due to forcible, visible, violent entry and exit into the risk address

Most insurance policies have additional coverage such as personal liability, Fridge and freezer contents, Guests’ and domestic employees’ property, Personal documents, Groceries and household goods in transit amongst others.

It should be noted that more-often-than-not insurance policies may require items such as cellphones, laptops, bullion, jewellery to be specified separately on the policy as they are not covered under your household contents. The main reason for there is they are taken away from the place of residence. These are insured under what can be called the “All Risk Items Section” or “Portable Possessions Sections”.

Different insurance policies will offer optional products to your household contents section. In some instances, these optional products are automatically included in your policy at a limited sum insured. They range from a power surge to Accidental Damage extension within a host of much more.

Generally, accidental damage cover is excluded in household contents cover. It is, however, a very important extension to have on your insurance because, though the losses are not that great in value, they tend to be more frequent. An example of incidents that are not covered by your household contents cover but will be indemnified by the accidental damage extension would be when your microwave is accidentally knocked over or a television set is knocked down to the floor whilst tidying up the house. That is why accidental damage cover is offered as an optional product to cater to such fortuitous eventualities.

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

DEFINING THE CLAUSE

This can be defined as a clause in an insurance policy that restricts the amount payable to a sum not to exceed the value of the property destroyed and that bears the same proportion to the loss as the face of the policy does to the value of the property insured.

Depending on insurers, the average clause will usually not apply on agreed insured sums such as on a motor vehicle. Most motor vehicles are insured on a retail, market or trade value basis.

WHAT IS UNDER INSURANCE AND HOW DO WE AVOID BEING UNDERINSURED?

Many South Africans assume that if they have a home contents insurance policy in place, they will be covered if any of their possessions are lost, stolen or damaged. The same applies to commercial policies who have insured their business equipment. What they do not realize is that if these possessions are not insured at their replacement value they could have to cough up – even if they have been diligently paying their insurance premiums every month.

THE FORMULA DETERMINING AVERAGE IS AS FOLLOWS:

(Sum Insured / Value at Risk) x Amount of Loss

EXAMPLE

You put in a claim for R50 000 worth of damage to your fixed property.

Value of fixed property = R1 000 000

Insured for = R 500 000

AS YOU ARE UNDERINSURED THE PAY-OUT WILL BE CALCULATED AS FOLLOWS:

(R 500 000 / R 1 000 000) x R 50 000 = R 25 000

What is the replacement value of goods?

IT IS IMPORTANT TO ALSO UNDERSTAND THE TERM REPLACEMENT VALUE

The replacement value of goods is what it would cost you, at the time of a claim, to replace all your belongings with similar brand-new ones. If you submit a claim, your insurer will calculate the replacement value you should have insured yourself for. If you insured your belongings for less than that, your insurer will only pay a part of your claim.

WHY WOULD A PERSON BE UNDER INSURED?

Many clients are just not prudent when it comes to updating their policies and inventory lists. This is probably the most common sort of under insurance encountered. Or sometimes it is just too expensive to insure the items to their full replacement value. 

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

Simply put, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time.

Insurance is not an exception. When it comes to annual contract renewal time, short-term insurance policyholders will often receive a notification from their insurance company of a premium increase. The increased sum insured will be formally reflected in your Schedule, and your premiums will be adjusted accordingly.

Inflationary increases on sums insured, such as your home, its contents and all risks (the belongings the policyholder carries with them outside of the home e.g. a mobile phone or laptop) is not technically a premium increase. “The cover for these belongings is heavily influenced by the Consumer Price Index (CPI) and the reason why insurers have to increase the sum insured (the value of the cover) is that these items will cost more to replace or repair a year later due to inflation.”

You might think that property insurance premiums or property limits should never go up – especially if you did not have a loss. This is a misconception. The truth is that the cost of underlying components, which make up the insurance property limit, continue to increase, it is a financial law of gravity. Renewing a policy “as is” year after year could prove to be detrimental to your coverage and leave you grossly underinsured. Real property and contents need to be adjusted annually for inflation, and policyholders and agents need to be aware of this.

The appropriate valuation of your property and its contents is critical to the strength of your policy. Upon renewal, spend a bit of time evaluating your coverage. In the event of a loss, you’ll be glad you did. It remains your responsibility to ensure that you are always adequately insured.

Article courtesy of Suretimes.

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

It is a general practice across the global insurance markets that losses emanating from terrorism, riot, civil commotion, strikes and public disorder are an exclusion. Amongst other reasons, insurers are reluctant to provide cover for these because, unlike other risks, their historical data is scarce, the occurrence is not random, and they are often geographically concentrated.

South Africa has been dubbed “the protest capital of the world”, with one of the highest rates of public protests in the world. Our country has a history of political and social activism and mass action that often results in severe damage to property and losses in productivity and income. In February 2014 it was reported that there had been “nearly 3,000 protest actions in the last 90 days – more than 30 a day– involving more than a million people”. One of the notable recent protests is the “fees must fall protests” that resulted in damages amounting to R 320 000 000.

In order to address such risks in the country, a state-owned short-term insurer, Sasria SOC Ltd was incorporated.

“Sasria SOC Ltd is the only short-term insurer that provides special risk cover to all individuals and businesses that own assets in South Africa, as well as government entities. This is unique cover against such risks as civil commotion, public disorder, strikes, riots and terrorism, making South Africa one of the few countries in the world that provide that insurance, particularly at affordable premiums.”

However, sasria does not cover the following:-

  • Sasria does not cover you for consequential loss or damage, or loss or damage caused or contributed to by:
  • looting and theft, unless caused by any of the covered events mentioned above
  • property being dispossessed or confiscated by any lawfully established authority
  • the stopping or deliberate slowing down of work
  • any act of terrorism involving the threat of or actual use of any nuclear weapon or device and/or the threat of or actual use or release of any chemical or biological agent

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

If you or a family member have been injured or killed in a motor vehicle accident because one of the drivers was negligent, you may be eligible to claim from the Road Accident Fund (RAF).

The RAF is a publicly accessible fund set up to provide monetary compensation to those who have suffered injuries as a result of an accident on public roads.

This means that even if the driver of the car doesn’t have insurance, people injured in the accident (or the loved ones of people killed in the accident) can get money from the fund to help pay medical expenses and to compensate for wages they may have lost as a result of the accident.

WHAT IS THE ROAD ACCIDENT FUND (RAF)?

THE RAF PROVIDES FINANCIAL ASSISTANCE TO PEOPLE INJURED IN ROAD ACCIDENTS OR THE DEPENDANTS OF PEOPLE KILLED IN ROAD ACCIDENTS CAUSED BY NEGLIGENT DRIVING.

THE FUND IS FINANCED BY A FUEL LEVY THAT’S INCLUDED IN THE PETROL AND DIESEL PRICE.

WHO CAN CLAIM?

  • A person who was injured in the accident (except the driver who caused the accident).
  • Drivers (excluding the driver who caused the accident), passengers and pedestrians involved in the accident.
  • If you were the driver in the accident but are not the owner of the car and the accident was caused by the owner’s negligence (for example, if they didn’t fix the brakes) and you are injured, then you can claim from the fund.
  • A child, spouse or other person who depended on the income of the person who died in the accident.
  • A close relative of the dead person who paid for the funeral
  • A claimant under the age of 18 years must be assisted by a parent or legal guardian.

WHEN CAN YOU NOT CLAIM FROM THE FUND?

  • A person who caused the accident can’t claim from the fund. You can only lodge a claim if the accident was caused by someone else’s negligent driving.
  • You can’t claim if you were the only person and vehicle involved in the accident. The RAF doesn’t compensate individuals who are the primary cause of the accident for example, if someone who drives off a bridge due to their own negligence.

WHAT CAN YOU GET COMPENSATION FOR?

  • Medical expenses.
  • Funeral expenses.
  • Compensation for pain and suffering.
  • Lost earnings if you were unable to work.
  • Loss of support. Dependents of the main income provider of the household who was killed in the accident as a result of someone else’s negligence can claim loss of support.

HOW TO CLAIM FROM THE ROAD ACCIDENT FUND?

You can claim from the Fund yourself or you can get a lawyer to claim for you but you’ll have to pay for their services.

You must make the claim within 3 years of the date of the accident if you know who caused the accident. If you don’t know who the driver or owner of the vehicle was that caused the accident, you need to claim within 2 years.

Article courtesy of the Western Cape Government.

https://www.westerncape.gov.za/service/what-do-if-you%E2%80%99ve-been-involved-road-accident

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

As a new business owner, the last thing you want is the loss of your property or legal battles against it. A new business needs insurance because it helps cover the costs associated with property damage and liability claims. Without business insurance, business owners may have to pay out-of-pocket for costly damages and legal claims against their company.

A youthful Thomas narrates how he vividly remembers every detail of his first intended small business, a bunny-chow stand at his family’s house. The excitement! Reality seemed dreamy and dreams had just started coming true. Finally, the road to financial freedom had found its way to his feet. Financial projections screamed profit! To put the icing on the cake, all capital employed was solely from Thomas’ 2 years’ savings. Why not? It was about time savings graduated to investments. A deep stare at the acquired production assets, serving stands, marquee, raw materials, packaging and other expenditures birthed a proud young boy who was about to relieve the dearth in his family.

To this day Thomas says his body aches when asked to recall the morning of his intended first day of business. Being woken up by a large scream from his sister in the kitchen and instinctively running there to investigate what was wrong. In his mind, two fears grew rapidly whilst on his way there at a speed that would have made Usain Bolt jealous. The one thought was that his “sister’s life” might be in danger and the other was “his life” was in danger. “His life”, of course, were all newly acquired business equipment and raw materials. “You must have seen my face when I found my sister all well but in shock because “My life” was missing”, narrates a seemingly distraught Thomas. Burglars had forced themselves into his family house and stole literally all the business equipment and raw materials.

Thomas could not believe what had befallen him. Standing there, he was asking himself how he was ever going to recover the investment? Did this mean he has to save for another two years, again? What about his siblings’ tuition? The neighbour he had offered employment, what will he tell her? Questions without answers flooded his mind till a 9-year-old girl standing by quizzed rather condescendingly, “are you telling me that with all these insurance ads always on the television you did not buy any or at least think of a getting quote?”

So, it did take more months before he could officially open his business. This time he did not take any chances and contacted an old buddy of his, Khaya, down at a local financial services provider, Ayoba Insurance Brokers. Khaya enlightened Thomas on the risks he is susceptible to, advised, recommended and offered guidance on how best to address them. Furthermore, this friendly chap presented several products for Thomas’ consideration from the sixteen insurers Ayoba Insurance Brokers can place any type of insurance with. He also helped find insurance for Thomas’ personal stuff.

Below is a brief summary of some of the products recommended to Thomas as a new business owner: –

  • Liability Insurance – to help pay for lawsuits that claim your business, employees, services or products caused bodily injury or property damage to other unrelated parties
  • Property insurance – protects the physical goods and the equipment of the business. This includes but is not limited to vehicles, buildings, plant and machinery amongst others
  • Business interruption insurance – replaces income lost in the event that your business operations are halted for some reason, such as a fire or a natural disaster
  • Other Special type insurance – insurance for your money, accounts receivable, employee dishonesty, goods whilst in transit by road, sea, air or any mode

For a quote, contact us on +27 11 395 1631 or email us at nick@ayobainsurance.co.za / natalie@ayobainsurance.co.za

Alternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

The information and content contained herein do not constitute a recommendation or solicitation to purchase or sell any financial product or service or arrive at a financial decision, nor do the contents of this publication constitute any form of advice or guidance.

Credit shortfall insurance, also called Top-up or Gap insurance, exists to cover the difference between your vehicle’s retail value (usually the amount the car is insured for) and the amount you owe on your vehicle loan (settlement amount).

The Vehicle loan Company or bank may also offer you this cover. It is imperative that you confirm with the bank if it is already included in your instalment amount before asking your insurance broker to add it onto your insurance policy to avoid being double insured. Credit shortfall cover will pay-out in the event of a total loss settlement (write off) where there is an amount outstanding with the finance company greater than the sum that the vehicle was insured for.  

Example:

Mpho’s vehicle was insured for R100 000 at the time he was involved in an accident that wrote off his beloved car. At the time of the accident, he still owed the bank R140 000 in terms of a finance agreement.  As a result of Mpho opting for credit shortfall cover as an optional cover at an additional premium at a date before the accident occurred, the insurer will settle the difference by paying it to the bank thus leaving Mpho debt-free!

It stands to follow that when you break even or now owe the bank less than the vehicle’s sum insured, you no longer require credit shortfall cover.

Note: Just like a courtesy car or excess waiver, the credit shortfall cover is an optional extension on most insurance policies. This means that it is not automatically included in your policy hence you must request for it.

WHAT IS NOT INCLUDED UNDER VEHICLE CREDIT SHORTFALL?

  • Any refundable amounts added to the finance agreement over and above the purchase price of the vehicle. This includes insurance premiums, motor warranties and maintenance programmes which must be refunded to you by the company that administers the policy or warranty.
  • The credit shortfall on vehicle sound equipment or non-standard vehicle accessories which are not specified on your schedule and which form part of the finance agreement.
  • The excess on the vehicle claim, arrear instalments due and interest on them, additional finance charges and any early settlement penalties.
  • Any finance agreement where the amount of any single instalment differs by more than 10% from any other instalment (except for any final residual payments).
  • Any shortfall resulting from re-advances under an instalment sale or refinancing in terms of a vehicle.

For a quote please contact Ayoba Insurance Brokers on +27 11 395 1631 or email nick@ayobainsurance.co.za / natalie@ayobainsurance.co.zaAlternatively, you can follow the link http://ayobainsurance.co.za/detailed-quote/

The information and content contained herein do not constitute a recommendation or solicitation to purchase or sell any financial product or service or arrive at a financial decision, nor do the contents of this publication constitute any form of advice or guidance.