Charné is a Registered Tax Practitioner and  has written several magazine articles with financial related themes since 2006. She is a known finance and tax expert working as an adviser at lemons into lemonade financial planners cc.

In the first 3 parts of this series on insurance, we discussed whether you must use a broker and also how to go about getting insurance for your home and your car.

I want to talk about All Risk insurance cover. This is cover for items that you can take and use outside of your house. As soon as the item is used outside of your house, it is better to remove it from your Home Content or Household cover and insure it under the “All Risk” section of your policy.

Items that fall under this section can include:

•    phones, cameras and other electronic and photographic equipment;
•    clothing like travel luggage or an expensive leather jacket;
•    jewellery, like wedding and engagement rings;
•    bicycles;
•    model aeroplane equipment; and
•    golf clubs.

These items will be specified on your policy, so each item will be listed with its model number, details like the serial number (unique number on electronic equipment) and its value.

If you have watercraft items like a kayak, canoe or a boat, there is a specific section on the policy for these type of items. Your broker or call centre agent will guide you.

Like with any other insurance, you are:

•    not allowed to insure items at two insurance companies at the same time;
•    normally given the option to work directly with a company or through a broker;  
•    to pay an excess when you claim (or, it will be deducted before the full claim value is paid to you); and
•    not covered for any intentional damage caused to these items.

Worldwide cover:

With most policies, you will be covered anywhere in the world if you travel but still live in South Africa. Check with your broker or the call centre agent if you need to report any travel dates on your specific policy before you leave on your travels and that you have cover.

READ: How to insure your home: dos and dont's

What values to use when you insure items under “All Risk”:

When you insure any item, you will be required to give a specific value what it must be insured for. Make sure it’s the replacement value. If you, for example, bought an item worth R6 000 but you received discount of 10% on it and you only paid R5 400, you will still insure it for R6 000 because that is what it will cost to replace the item if it’s damaged or stolen. Also keep your proof of purchase. When you claim, you need to prove that the item existed, that you paid for it and what value it had.

TIP: Take photographs of each item and its proof of purchase. Keep this on your phone but also send a copy to yourself on email so that you can still access the information if your phone is stolen. Keep the slips too, but keep them inside an envelope or file so that they don’t fade. Better yet, make a photocopy of the slip so if they fade, you still can prove that you bought the item.

What you pay:

Insurance on these items are expensive when you compare it to household items that never leave the house. There are 3 reasons for this:
•    The risk is higher because these items don’t stay in one place and with insurance, the premium increases as the risk increases.
•    There are more claims on these items than on normal household items.
•    There are also, unfortunately, more fraud on these type of claims and consequently, premiums will become more and more expensive to make provision for dishonest claims.

Insure smaller items you use outside the house under “Unspecified All-Risk” section:

You have the option to be covered for items that leave your house but of smaller value. You don’t have to specify them on your policy. You choose a total value (for example R10 000) and if you claim, each item will be limited to a certain value which I call the “individual item limit”. Ask your broker or insurance company what the individual item limit is on your specific policy. As soon as the item you want to insure has a value more than the policy’s individual item limit, rather be safe and specify the article separately.

READ: Should you use a broker?

Leaving “All Risk” items in cars and bakkies may not have cover:

If you leave any such items in a car, it must not be in view to anyone. It must be concealed in any of the enclosed storage areas like the trunk or cabbyhole, as long as it is out of sight. If you have a bakkie, make sure that you have a canopy or cover before you leave items in the back otherwise the insurance will not cover it. Bicycles left on a car rack, have to be locked properly and also take a photo so that can be proven later, should you have a claim.

Remember that these items are not covered unless you formally put them on your policy. If you buy a new phone or bicycle on a weekend and the insurance company’s call centre is closed, you will only be able to add the item (and have cover on it) on the Monday. If you know you are going to buy a certain item on the Saturday or Sunday, rather phone the Friday and add the item for that specific day. You can add it for any date in future but you cannot backdate your cover afterwards.

Items that are not usually covered on policies:

Each policy also has fine print that you must be sure of,  for example, you can insure clothes but in most cases, theft of clothes off your washing line is not covered. If you insure your portable computer like a notebook or laptop, only the actual computer is covered and not the data or programmes (software) that you loaded onto the computer afterwards. With some policies, you do have the option to add these software separately.

Money (cash that you carry with you) is also not covered on personal policies. If you have a business and carry cash to and from the bank and want it covered, you must take out a business policy and specifically add this as a benefit on your policy.

Remember: If you won’t be able to replace an item in cash if it gets stolen or damaged, then consider taking out insurance for it.

This article provides general guidelines and does not contain specific advice.

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