Monday, October 22

Insurance challenge is tricky

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Being properly insured for the actual cost of any damaged, lost or stolen items can make a big difference in how you deal with any misfortune.

Valuing household items for insurance purposes can be difficult, but experts urge homeowners and tenants to neither over nor undervalue their items.

For those who will be applying for new household insurance or revising their existing insurance, it is essential to make a comprehensive inventory of their possessions and keep track of the total value.

Many owners struggle to value their goods appropriately, especially if they are inherited or second-hand items they didn’t pay much for in the first place, says Gerhard Kotzé, managing director of the RealNet estate agency group.

Being properly insured for the actual cost of any damaged, lost or stolen items can make a big difference in how you deal with any misfortune.

“Taking time to value your items is key, especially if you’ve lived in your home for many years and accumulated a lot of belongings.

“You don’t want to discover after a disaster that certain precious items were not insured because you overlooked them, or thought they were worth less than they were.”

Also, taking a thorough inventory and updating your insurance might make you realise you are paying to insure things you no longer need nor want, and that your home needs to be decluttered.

It will also help to speed up your claim process after a disaster and reduce the stress associated with such situations.

Here are some tips:

OVER VS UNDERVALUING

“If the estimated value of an item is too low, the insurance company will probably not cover the full replacement cost in a claim.”

It is just as important, though, not to overvalue your belongings, or your insurance premiums will be unnecessarily high, says Kotzé.

KEEP RECORDS

Homeowners should also ensure they have physical records of ownership. Kotze suggests when taking an inventory:

Photograph or make a video of your belongings while describing each item you want to insure for record purposes.

Add model/serial numbers as well as the date of purchase and value of each item.

“Keeping the proof of purchase for any new belongings can also be a great help if you have to calculate the replacement value at a later stage.”

ONLINE TOOLS

There are many online tools that will help one take an effective inventory. There are even mobile apps that will help value items and automatically update to allow for inflation, such as Encircle for android phones and Belongings for iOS phones.

PRINTED COPIES

If you print your inventory, keep a copy somewhere away from home, along with any valuation or appraisal certificates.

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