How to choose your insurer

We are often asked the question: How do we choose the insurer for our Body Corporate?

First and foremost, deal with a licensed financial advisor (broker) who specialises in and/or is knowledgeable in sectional title insurance and understands the risks associated with communal living. They will be best equipped to offer you or the trustees an insurance policy product that is tailor-made for the sectional title environment.

There are a number of specialist insurance underwriting management companies who administer policies on behalf of insurers and these are the policy products best suited to your need.

When choosing an insurer, you need to understand that the most suitable cover is not necessarily the one with the most favourable premium. Trustees need to also act in the best interest of all owners; for example, it may be best that trustees elect a nil excess for geyser replacements with an increased premium. It is also important to check and compare overall excess structure: lower premiums are often achieved by application of higher or raised excess structure.

Some of the more current policies offer cover on an ‘Asset All Risk/Broad Form’ basis. These policies do generally impose a higher premium; however the cover provided is by default wider than that of a standard perils based ‘combined’ policy.

Your advisor should recommend the most suitable option to trustees for their consideration. In order to do this, you should be provided with at least three alternative quotations every year when it is time for renewal of the policy. It is important that such quotations and recommendations are presented with a letter of advice from the insurance advisor. We do not advocate that you chop and change insurers every year but you should evaluate the current market offerings. It is always best advised to retain a long and sound relationship with a reputable insurer.

 

Author : Brian Addison

Contact Addsure – The Leaders in Sectional Title Insurance – to get fit and proper advice from advisors who understand sectional title. Contact us in Johannesburg on (011) 704-3858; in Durban on (031) 459-1795 and in Cape Town on (021) 551-5069