Tenants need their own insurance

Wild weather and damage to homes over the past few weeks has once again underlined the need for proper insurance - and tenants especially need to be more aware that their personal belongings are not automatically safeguarded under their landlord's insurance policy for the property they inhabit.

This is a common misperception, says Gerhard Kotzé, CEO of the RealNet property group, but tenants really do need their own insurance cover, for several reasons - and some lease agreements actually include a provision to this effect.

"The landlord's insurance typically covers the building itself but does not protect the tenant's personal belongings inside or outside the structure. Tenants need to take out their own insurance cover for their personal property such as cars, furniture, electronics, clothing and other belongings in case of theft or damage due to fire, flood, hail or other natural disasters.

"In addition, tenants should seriously consider getting personal liability coverage, which will protect them if someone is injured on the rented property and they are found to be legally responsible. This type of insurance can cover legal expenses and medical bills for the injured person."

They may also find it useful, he says, to have insurance that will help cover any additional expenses like hotel bills or food costs if their rented home becomes uninhabitable due to something like a fire or flood and they need to seek alternative accommodation until it's repaired.

But before signing up for any insurance policy, tenants should always:

*Get at least three quotes from different companies so that they can compare apples with apples and choose the best cover, for the most reasonable monthly premiums, and with the lowest excess payments in case of claims.

*Make a detailed inventory of their belongings and estimate the value as accurately as possible. If their estimate is too high, they are going to pay higher premiums than necessary, and if it is too low, any future claim they make will only be proportionally paid out.

*Check if anything will be excluded from the cover and which items will have to be included in the "all-risks" section. All-risks items usually include goods that are often taken out of the home, such as cell phones, sunglasses or golf clubs.

*Pay attention to the limits of coverage for each category to ensure it meets your needs and consider any special coverage you may need for exceptionally valuable jewellery, art or collectibles.

*Check that their possessions will still be covered if they often go away for work or on holiday. Some policies will not pay out if the home is unoccupied for more than 30 days a year.

*Establish clearly what their "excess" payment will be in the event of a claim - and try to lower it as much as possible without sacrificing proper coverage.