Planned power outages and insurance

(Article by *Bertus Visser)

Eskom has warned that South Africans may expect planned power outages country-wide as everyone returns to work, and the start of the year is a good time to recap the effect these power outages could have on your short term insurance coverage.

What happens if your electric fence or alarm doesn’t work due to a power outage and someone breaks into your house? Especially if a connected alarm is a prerequisite for coverage according to your policy? And what if electronic equipment burns out due to a power congestion?

There are various precautionary measures that can be taken to maintain your coverage and prevent losses or to ensure that losses are indeed covered. Most insurers don’t cover losses due to intentional or load shedding maintenance or repairs. It is the responsibility of the insured party to ensure that alarm devices and supporting devices like batteries are in working order. The insured party must takes out additional coverage if possible to cover these types of losses under other accidental damage or events.

When it comes to alarms and electric fencing, policy holders must ensure that the batteries for both systems are fully charged at all times. Most batteries can keep the system going for at least eight hours and in some cases even as long as 24 hours.

Clients can also take additional precautionary measures to protect their homes by locking gates and garage doors with locks during power outages.

Power outages are usually coupled with power congestions which can destroy electronic equipment. Coverage is not always included as standard on all policies, so we advise that policy holders to confirm with their broker or insurer what their specific coverage and limits entail in the event of power congestion.

Swimming pool pumps and gate motors can be covered if optional extended coverage is taken out for accidental damage.

Clients can also install power congestion isolators on their main power distribution boards in their homes or business premises to limit or prevent damage. This will help limit damage to items like computers, fridges, gate motors and swimming pool pumps. Power congestion isolators can also help to limit lightning damage. Various insurers also offer services to advise policy holders on how to prevent or limit power congestions. Ask your broker for advice regarding these insurers.

You can also take out utility services coverage at a nominal monthly fee where clients can contact a central number to call out suppliers or repairmen to do repair work on the premises if items or devices are damaged due to possible power congestions.

Fridges and freezers usually keep the contents cold for at least 24 hours if the doors are not constantly opened. In most cases insurers will therefore not pay for the loss or spoilage of food within this period. If you plan to go away for longer than a day or two, we suggest that you ask a friend or a neighbour to keep an eye on electrical devices should power congestions occur during your absence.

And ask your broker whether or not your coverage for accidental damage is sufficient.

*Bertus Visser is the chief executive of distribution at PSG Insure.

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