Proving ownership of household items when claiming from your insurer is not as easy as it may seem. Often the insured has not drawn up a proper inventory of all of his or her household possessions prior to submitting a claim or even prior to the inception of cover with their insurer.
Many consumers are also not aware of the average clause in their insurance policy. The average clause is a clause in your insurance policy which stipulates that if the sum you insured your household contents for is less than the actual value of your household contents, your insurer is entitled to pay you a lesser amount. As an example Mary insured the contents of her house for R100 000 but did not have a detailed inventory, so she really did not know the true replacement value of her household possessions. After she was robbed and submitted a claim with her insurer, she drew up a list of all the items in her home including those which had been stolen and realised that she should have been insured for R200 000. She was therefore insured for 50% of her contents and was paid out only 50% of her claim. She was out of pocket for the other 50% of the stolen items.
The Ombudsman for Short-Term Insurance’s office has issued the following guidelines for consumers to follow so as to avoid possible problems in the event of a claim arising from the loss of home contents.
· Create and maintain an inventory of your household items and keep a separate insurance file: Whilst this might appear to be an onerous task, it will be worth it in the long run. An inventory is a list that records all your valuable items, when and where you purchased the item and how much it cost. Having an inventory will save you time when you submit a claim to your insurer as they will ask you to provide proof of existence of all stolen items. It can also serve as a guideline on how much you will recover from your insurer in the event of a claim. There are companies that can assist you in compiling an inventory of all the items in your house. If you do not wish to use a company to assist you with compiling your inventory, then it is recommended that you list your items room by room. Remember to update your inventory on an annual basis or as and when you acquire new household items.
· Keep copies of receipts and invoices: Keep copies of receipts and invoices for household items purchased. These can be kept together with the inventory. Some insurers may not compensate you for a claim if you fail to provide the original invoice or receipt. Some invoices also contain a serial number for the item, if not, it is advisable that you also maintain a list with the serial numbers of all your higher valued items, such as electronic equipment or items, which carry guarantees and/or warranties.
· Take photographs: A good idea is to take photographs of the different rooms in your home. This may go some way to establishing what was in the rooms and that you were in possession of the items that you are claiming for. It will also provide you with a visual memory of the items that were in the different rooms.
· Jewellery: Many insurers will require jewellery items that exceed a certain amount to be specified on the insurance policy. In the event of a claim your insurer may ask for valuation certificates. It is therefore important that you keep all valuation certificates safe and update them regularly with a reputable and recognised jeweller.
Remember to always provide true and complete information to your insurer at all times, including when you are claiming. Do not claim for a more expensive item than you originally owned or for an item you did not own as your entire claim may possibly be repudiated by your insurance company as a fraudulent claim.
Dennis Jooste, Ombudsman for Short-Term Insurance