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Ultimate Guide To Home Insurance in South Africa 2020

We've put together an easy to use guide that covers everything you need to know about insurance for your house and belongings in South Africa 2020.

Home insurance can be confusing. On top of that, many South Africans feel like a it is a non-essential expense. However, whether you’re renting a property or are a home-owner, getting home insurance (or household content insurance) is crucial to protect your home and belongings.

You can compare Home Insurance quotes online with CompareGuru and find the best de al from SA’s top insurers.

We understand the pains around home insurance! To make things a little easier, we’ve put together this essential guide to help you easily master the basics of what home insurance is, how much you need, and how to calculate the value of your possessions and property.

In this guide, we look at the following topics:

• What Home Insurance is

• Why you need House Insurance

• What Home Insurance covers

• The different types of Home Insurance

• How much Home Insurance you need

• How your Home Insurance premium is calculated

• How to calculate the value of your property and possessions

• Insider tips for choosing the right Home Insurance policy

• Tips from the experts on how to save money on your House Insurance premiums

What Is House Insurance?

House Insurance will financially cover you if you need to repair damage or loss to the physical structure of your house. This also includes permanent fixtures in your home such as kitchen units, built-in-cupboard, toilets and baths. 

House insurance provides you with peace of mind that your largest asset is covered in the event that it would for example, be burnt down in a fire. Without house insurance in this example, you would lose this asset as well as still having to pay back your mortgage. 

You are also able to purchase a house contents insurance policy, which will financially cover you for any damage or loss to the furniture and possessions within your home. 

Take Note: If your property is financed by a financial institution, they require you to have homeowners insurance. However, you do not need to take your financial institutions homeowners insurance offer, you can use the same insurer you use for your car, and other valuables as they may offer you a cheaper premium for having multiple policies.

Why Do I Need House Insurance?

1. Property coverage – Homeowners insurance covers the physical structure of your home and your personal property, if it gets damaged or destroyed. 

2. Liability coverage – This type of coverage is used by Airbnb for its hosts. It provides for if someone (not covered under your policy) is injured or killed. Or, if their property is damaged or destroyed while they’re on your property or adjacent to your property. A homeowners policy covers any personal legal responsibility. For example, if the branch of a tree in your property falls on a parked car on the street, you will be covered. 

3. To satisfy your mortgage bond lender – If you apply for a bond on your house, the lender will most likely request you take out insurance for as long as you have the bond. You will then have to list the lender on the mortgage policy. 

What Does Home Insurance Cover?

1. Fire, lightning, and explosion; 

2. Malicious damage; 

3. TV aerials, satellite dishes, and masts; 

4. Bursting, leaking, or overflowing pipes, water apparatus, or oil-fired heating apparatus; 

5. Storm, flood, wind, water, hail, or snow; 

6. Earthquake; 

7. Loss or damage to the private residence caused by impact; 

8. Theft or attempted theft; 

9. Gradual sinking of land (subsidence) and landslip of the land supporting the private residence; and 

10. Damage by wild baboons or monkeys.

Different Types Of Home Insurance

1. Coverage for the structure of your home  

2. Coverage for your personal belongings 

3. Liability protection 

4. Additional living expenses if you are temporarily unable to live in your home because of an insured disaster

How Much House Insurance Do I Need?

You need to ascertain whether you need buildings insurance or contents insurance or both. If you own your home, you will need buildings insurance and contents insurance. It may be cheaper to have one policy that includes both instead of having separate policies. 

If you’re renting, you would only need contents insurance because the integrity of the building is the landlord’s responsibility. Your insurance company needs to know the value of your property so if they need to rebuild or repair your home, they know how much to pay-out in the event of damage. The same concept applies for your contents insurer, they need to know the true value of your possessions and furniture so that they can repair or replace items if you make a claim.

How Is My Home Insurance Premium Calculated?

1. The cost to rebuild your home: As mentioned above, this may differ from the market value. An estimation on replacement costs, using information about your home and its contents, will need to be determined by you and your insurance agent. 

2. Is your home made of brick or wood? Brick and masonry houses usually have a lower premium as they are far less of a fire hazard. 

3. How close is your home to resources and services? This includes fire stations as well as the quality of your community’s fire protection services. 

4. The age and condition of your home: Older homes and homes in poor condition have higher premiums. 

5. The claims history of your neighbourhood: Insurers look at the claims history of homes in your area, and immediately next to you, to assess risk. 

6. Do you have a wood furnace or wood stove in the home? Fire hazard. 

7. Do you own high-risk outdoor amenities? These are amenities that could cause injuries such as a swimming pool, a trampoline or playground equipment. 

8. Do you have aggressive dogs? Insurers actually won't see this in your favour as aggressive dogs put people on your property at risk of injury.

How Can I Calculate The Value Of My Property And Possessions?

The first and most important thing to look at when shopping for house insurance, you need to get the true value of your home or your possessions. You can gather a property estimated evaluation based on your rates and taxes otherwise you can get an evaluator to assess your property’s worth. 

Take Note: Keep in mind, the state of maintenance when you take out the house insurance policy will be the same value if you are to make a claim. However, if your house has not been maintained, your house insurance company may not cover your claim. On the other hand, if you renovate your home, you should notify your house insurance company to get a revaluation so that in the event of an accident or damage to your house, you are not under insured. It’s very important to be completely honest about the state of your home as well as that of your possessions so you are not left under-insured.

Follow our quick guide below for optimising your contents household insurance. You will be able to keep tabs on what you own so you know what is either stolen or damaged and ensure you are comprehensively covered for any eventuality.

The best way to do this is methodically and categorically. Keep a camera handy and take pictures of everything, be sure to update the list every six months. 

1. Start by picking a room to categorise.

Try write down in detail everything you have from furniture, curtains, and individual possessions in each room. It may be easier and helpful to take good quality photographs of each room.

2. Take photographs of your expensive belongings

Like jewellery, electronics like televisions, music players, cell phones, and cameras. You can upload these pictures onto an online storage facility like Drop Box ( for permanent cyber storage or you can burn them to a DVD for safe keeping.

3. Collect and file your receipts, warranties, and invoices

 As proof of original purchase prices. Take note of the brand, model, and serial numbers of all home electronics. You should also keep your insurance policies in a safe place.

4. Don’t forget to include expensive clothes

Such as evening wear or designer handbags and shoes. 

5. If you are unsure of the value of your jewellery or any other item, get it appraised.

Keep in mind the limits often given to the insurance of valuable items in your insurance policy.

6. A great time for spring cleaning

Search the tops of cupboards, storage rooms, and garages for items you may have forgotten about like sporting gear, family heirlooms, and seasonal clothing. 

7. Don’t forget to include the furniture and items outside

Like your garden furniture, your braai, children’s jungle gyms, or anything else.

Insider Tips For Choosing The Right Home Insurance Policy

Choosing the right home insurance option can be difficult, luckily, we have these easy tips to help you find the most affordable cover.

1. Accurate Content Evaluations

Create a full and comprehensive list of all the contents in your home so you can create an accurate estimation of the value of your possessions. Make sure you don’t leave anything out to save a few bucks because if something were to happen, you would be underinsured and you would have to pay to replace the items.

2. Know Your Policy’s Limitations

All policies available will have a limit as to how much the insurance company would be willing to pay out per asset, you need to know what this amount is. Make sure you read the fine print on the policy before you sign. Your policy will probably not cover every single asset for every kind of loss situation but you must know what is included. Items excluded from a claim according to your policy often comprise of antiques, damage from storms, and a lack of maintenance to your home.

3. Avoid Discount Insurers

As tempting as it may be, choosing the cheapest insurer that offers “discounts” will cost you in the long run. Be sure to avoid insurers that offer discounts as the low-cost policies have some nasty and expensive surprises in the fine print. You either need to give up a certain level of coverage, customer service, or you actually pay back the “discount” a few months later with higher premiums.

4. Insure Collectables Separately

Most basic insurance policies will not cover antiques or collectables. You can either pay an extra premium with your basic policy or you may have to take out a completely different policy. This will depend entirely on your insurance provider. Take note, it is important for you to safeguard any appraisal certificates of your collectables, as you would need to prove their worth in case of loss.

5. Up Your Excess

To save on your monthly premium, ask your insurance broker to increase your excess. This means that the required amount you need to pay for the cost of filing a claim with your insurance company, termed excess, would be higher than the normal rate. If you intend to do this, make sure you increase your excess before you start paying your monthly premiums.

6. Always Compare

Don’t be fooled by the bold offers of some insurance companies, always take a closer look at the policy details such as limitations, excess, and overall price. To compare a variety of good quality home insurance providers, simply go to 

7. Replacement-Cost Coverage vs. Actual Cash-Value Coverage

Check your house insurance policy whether you are covered for ‘replacement-cost ‘or ‘actual cash-value’. Replacement-cost coverage is less popular than the latter because it pays to replace the damaged items with material or items of “like kind and quality” at current prices. So if your 2010 Apple iPod goes for a swim in the washing machine, your insurance company will replace it with the latest Apple iPod available. In contrast to this, actual cash-value options will replace your lost or damaged items at the item’s depreciation value. Replacement-cost coverage options would normally cost a bit more and some companies don’t offer this option anymore.

8. Claiming Your Appraised Value of Your Loss

Be aware that when your appraisal value for your property was made, that is the value that will be used when you claim. Sometimes insurance companies refuse to cover house insurance claims if the property has decreased in value since your previous appraisal due to depreciation or poor maintenance. If your insurance company is filing your claim for damages to your belongings or house, you will get the actual-cash coverage based on the value at the time of the loss.

9. Be Aware of Value Limits on Belongings

Some insurers won’t pay-out for the full replacement of your claim because they often have a limit on the value of certain items. If they do replace your lost or damaged belonging, they base it on the average person’s losses. You can speak to your insurance company about increasing these limits to accommodate your specific needs.

10. Renewing or Losing Your Policy

 Your insurance company may cancel your insurance policy or deny a renewal if your property’s value doesn’t meet your insurance company’s underwriting standards. Alternatively, you may not be offered a renewal of your contract if you have filed more claims than the average person. The average person makes one to two claims every ten years. Your insurance company will notify you thirty days before the end of your policy’s duration with either an offer of renewal or ‘non-renewal’. If you insurance company cancels your policy, it may be due to unpaid premiums. Your insurance company will always notify you ten days in advance if they are cancelling your policy. They may use a late billing notice to inform you that your policy has been cancelled or is pending cancellation.

Expert Tips To Save Money On Your Home Insurance Premiums

Home insurance is a vital investment that ensures you are covered from incidents like home invasions and theft to natural disasters. However, like most insurance, it is a grudge purchase and another stress on our already strained wallets. We have some tips you can use to try reduce your premiums - giving you protection while also saving some money.

Did you know that combining your home and car insurance can save you money?

1. Don't Include Your Land In The Valuation Of Your Home

As points out, the cost of buying your house is different to the cost of rebuilding your house. Generally, even in the event of a disaster, which destroys your home, your land will remain intact. Therefore, you should not include the value of your land when you take out your home insurance policy. By having a reduced amount of cover, you will have lower premiums. While you may think The more cover, the better, this isn't necessarily true if you end up not submitting a claim. This is especially important in areas with high land costs. Your land's value could make your premiums skyrocket.

2. Add Safety Features To Your Home

Many people don't realise that things like installing an alarm and other security features can reduce your premiums. In addition to this, making your home compliant with fire regulations can also reduce your premiums. These upgrades are relatively low-cost and will save you a larger amount of cash in the long run. This can also apply to flood-proofing your home if your area is prone to floods.

3. Use The Same Insurance Provider For Multiple Policies suggests using the same insurer for multiple policies, if they offer discounts for taking out multiple coverage options. A useful combination could be home and car insurance - since most owners of these assets will consider cover for them a necessity. Since you're investing in both anyway, you should try get a discount by using the same insurer.

4. Update The Value Of Your Possessions Once a Year

Did you end up selling that extra TV you didn't need? Or, have some of your possessions devalued with age? Your insurer is not likely to over-value your assets when it comes to time to claim. So, you shouldn't be paying premiums for assets that have devalued, or which you don't own anymore. Of course, updating the value of your assets could increase the cost of your premiums, if you bought something expensive. However, this is still important as updating your cover safeguards that asset and allows you to add coverage for it.

5. If You Haven't Claimed For Years, Consider Renegotiating Your Premiums

According to Realty Times, if you have proven yourself to be a low-risk client, by not claiming for a long period of time, you may be able to ask your insurer for a discount. This could be combined with a loyalty discount if you have been with the same insurer for years. While it is not guaranteed that your insurer has these discounts available, it's worth contacting them to find out. And, if they don't offer this, you could consider moving to an insurer which does.

6. Do Your Research

Knowing what insurers consider risky behaviour can work in your favour. For example, smokers may attract higher home insurance premiums due to most house fires being cause by cigarettes. Therefore, if you don't smoke, make sure to highlight this fact to your insurance agent. Of course, don't lie. As we outlined in this life insurance article, lying to your insurer will end up costing you instead of them. Researching insurance plans can also make sure that you get the best value-for-money by considering multiple companies. 

Insuring your home is not simply a once-off discussion, it requires constant updating should you buy new valuables, make renovations that increase the value of the property, or simply as a result of inflation.

House insurance is no longer a luxury but it’s a need. Whether you are a home owner or a leaseholder, you can get the most affordable and comprehensive home insurance comparisons on Compare Guru. 

Keep your house a welcoming home by insuring the property and the possessions you have inside it.