Understanding body corporate insurance ahead of possible winter weather damage

With another cold-front holding South Africans in its grip, it is important to understand body corporate insurance before all the winter weather damage hits your home. 

Carl Smit, managing director of Sandak-Lewin Property Trust, says that as extreme winter weather conditions usually result in an increase in property damages, homeowners need to ensure that their insurance policies are up-to-date in case they need to claim for weather-related damages.

According to Smit, for those living in sectional title schemes, it can be assumed that the body corporate will have adequate insurance cover against weather-related damage to the building. However, he says that individual unit owners need to properly understand what exactly is covered in the body corporate’s policy, and need to know how to claim for related damages should the need arise.

“Body corporate insurance covers all buildings in the scheme – individual housing units and common property areas such a passages and lifts – and applies to internal and external damage to units. For example, if a building’s roof or windows are damaged due to extreme wind conditions, the body corporate insurance will pay out to fix the damage.”

Owners who are unsure of the value to which their unit is covered are entitled to request the insured value of their property by viewing the insurance policy kept on file by the body corporate. If owners believe that the amount that their units are insured for is not sufficient, they can request that the cover be increased.

“This request needs to be coupled with a recommendation to the trustees to ensure that the value of the entire building is correct, as body corporate rules require that the scheme never be under-insured,” says Smit.

“For many owners, the confusing part is not the terms and conditions of the insurance policy but rather the process of claiming for damages for repairs to commence. It’s the owners’ responsibility to initiate insurance claims through the body corporate. Tenants’ claims still need to go through the owner of the unit, who must sign off the claim before it can be taken to the body corporate for processing. Thereafter, the claim must be signed off by the trustee or managing agent to ensure its legitimacy.”

Smit says claims by owners should not be taken directly to the insurance broker as the body corporate may be unaware of the claim and the broker may not know whether the person initiating the claim is an owner in the scheme.

“Once the claim has been made, there is a chance that an excess amount will be due, depending on the policy and level of damage. In this case, the question arises – who is responsible for the excess payment? According to the Sectional Titles Act, the owner of the section who is initiating the claim is responsible for the insurance excess payment.

“If owners of sectional title units wish to initiate additional insurance through an independent broker to cover any future excess payments claims or extend cover for renovations done to a unit, they are free to do so,” says Smit.

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