Looking at statistics from the South African Police Service Crime Report for 2010/2011, a total of 247630 burglaries and 16889 robberies were reported at residential premises, so it makes sense for most home owners to have a safe installed in their homes.
 

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With a total of 247 630 burglaries and 16 889 robberies reported at residential premises, according to the South African Police Service Crime Report for 2010/2011, many homeowners have begun installing safes on their properties to protect their valuable and irreplaceable items from theft, loss or damage. While this can be an excellent way to protect valuables, it is also of the utmost importance that clients are reminded about the terms and conditions on their insurance policies when using a safe to avoid the risk of a claim being repudiated.

 

Typically, cover for items stored in a residential safe fall under a standard home insurance policy. However, most policies stipulate that items over a certain value – for example, jewellery over the value of R50 000 – must be stored in a safe if it is not being worn or used by the insured at the time.

 

When it comes to storing cash in a safe, similar limitations apply. Policies may state that any cash over the value of R25 000 must be stored in a locked safe. It should be borne in mind that every insurer will have different stipulations and limitations so it is crucial to stress the importance of reading and understanding the terms and conditions of the insurance policy to the insured.

 

Most policies require that signs of forcible and or violent entry into the safe or removal of the safe from the house must be present in order for the claim to be paid out. Unless the policy holder was held at gunpoint and asked to open the safe, it must be clear that the contents of the safe were taken by force and the safe was not simply left unlocked.

 

It is imperative to inform your clients that when storing valuables in the safe that the contents and value of the items stored must be declared at the inception of the insurance policy. If the policyholder does not inform the insurer of the contents, the policy will not cover any loss or damage.

 

For example, if a homeowner takes out a home insurance policy to cover their home up to the value of R1 million but forgets to declare the additional contents of the safe worth R500 000, the homeowner will be underinsured by R500 000. Should the contents be stolen or damaged, any claim will then be subject to the average amount. It is therefore vital to inform your clients that when they are conducting their inventory for insurance purposes, that they include the items stored in their safe in the total sum insured.

 

Some policies may also require that a certain category of safe is used in order for the cover to be valid. The different categories of safes range from category one to four and are determined by the amount of time that is needed in order to open the safe.

 

Although MUA does not stipulate the type of safe to be used, it is advisable for your client to choose a reliable safe and bolt it down so that it impedes removal. When purchasing a safe, make sure it is fire resistant so that all irreplaceable documents, such as identification papers, birth certificates, wills and hard drives with family photos are not damaged in the event of a fire.

 

It is also important for clients to understand that when they are travelling the same rules apply for storage requirements of valuables as stipulated in their policies. Therefore if the policy requires that the items must be stored in a safe when not worn, they must adhere to this while on holiday by storing the items in the hotel safe to ensure the items will be covered in the event of a claim..

 

Another useful tip for your clients when travelling is to store a backup of all travellers’ cheques, copies of passports and other travel documents in a safe at home before departing on holiday. This will ensure that should these documents get stolen or damaged while on holiday they can ask a close family member to send copies of the documents to them to avoid any administration issues while abroad.

 

Studies have shown that during a break-in or robbery, burglars tend to head straight for the bedroom to locate any valuables and a safe, as this is the most common location for these items. Therefore, it is advisable to tell your client to install their safe in a place that is least expected, such as in a cellar, under wooden floor boards, in the bathroom or in the kitchen.

 

As with most insurance policies, when it comes to storing valuables in safes, the best advice to give your clients is to understand the requirements of their policy in order to ensure that when your client submits a claim the process runs smoothly.With a total of 247 630 burglaries and 16 889 robberies reported at residential premises, according to the South African Police Service Crime Report for 2010/2011, many homeowners have begun installing safes on their properties to protect their valuable and irreplaceable items from theft, loss or damage. While this can be an excellent way to protect valuables, it is also of the utmost importance that clients are reminded about the terms and conditions on their insurance policies when using a safe to avoid the risk of a claim being repudiated.

 

Typically, cover for items stored in a residential safe fall under a standard home insurance policy. However, most policies stipulate that items over a certain value – for example, jewellery over the value of R50 000 – must be stored in a safe if it is not being worn or used by the insured at the time.

 

Most policies require that signs of forcible and or violent entry into the safe or removal of the safe from the house must be present in order for the claim to be paid out. Unless the policy holder was held at gunpoint and asked to open the safe, it must be clear that the contents of the safe were taken by force and the safe was not simply left unlocked.

It is imperative to inform your clients that when storing valuables in the safe that the contents and value of the items stored must be declared at the inception of the insurance policy. If the policyholder does not inform the insurer of the contents, the policy will not cover any loss or damage.

 

For example, if a homeowner takes out a home insurance policy to cover their home up to the value of R1 million but forgets to declare the additional contents of the safe worth R500 000, the homeowner will be underinsured by R500 000. Should the contents be stolen or damaged, any claim will then be subject to the average amount. It is therefore vital to inform your clients that when they are conducting their inventory for insurance purposes, that they include the items stored in their safe in the total sum insured.

 

Some policies may also require that a certain category of safe is used in order for the cover to be valid. The different categories of safes range from category one to four and are determined by the amount of time that is needed in order to open the safe.

 

Although MUA does not stipulate the type of safe to be used, it is advisable for your client to choose a reliable safe and bolt it down so that it impedes removal. When purchasing a safe, make sure it is fire resistant so that all irreplaceable documents, such as identification papers, birth certificates, wills and hard drives with family photos are not damaged in the event of a fire.

 

It is also important for clients to understand that when they are travelling the same rules apply for storage requirements of valuables as stipulated in their policies. Therefore if the policy requires that the items must be stored in a safe when not worn, they must adhere to this while on holiday by storing the items in the hotel safe to ensure the items will be covered in the event of a claim..

 

Another useful tip for your clients when travelling is to store a backup of all travellers’ cheques, copies of passports and other travel documents in a safe at home before departing on holiday. This will ensure that should these documents get stolen or damaged while on holiday they can ask a close family member to send copies of the documents to them to avoid any administration issues while abroad.

 

Studies have shown that during a break-in or robbery, burglars tend to head straight for the bedroom to locate any valuables and a safe, as this is the most common location for these items. Therefore, it is advisable to tell your client to install their safe in a place that is least expected, such as in a cellar, under wooden floor boards, in the bathroom or in the kitchen.

 

The release of Sex & the City 2 earlier this year once again highlighted the attraction of designer clothes and accessories to South Africa’s women. However, with the majority of these women vastly underestimating how much their wardrobes are actually worth, it is vital that our female clients understand the pitfalls of not insuring their wardrobes for the true cost of replacement.

 

The regular assessments we make at MUA of our client’s possessions have shown that about 90% of women – particularly in the high end market – significantly underestimate the cost of their wardrobes, estimating them to be just half of their actual value.

 

Underinsurance is not just a local trend. There seems to be a global tendency towards underinsurance in women’s wardrobes with a recent study in the UK by British insurer Liverpool Victoria revealing that the average woman in the UK only values the contents of their wardrobes at about £1,840 (R22,000). The true cost is actually around four times higher at £7,000 (R84,000).

 

The main cause of this stems from the fact that insurance values are calculated on the replacement cost of items, so a designer suit that would have cost your client R2 000 a few years ago, will probably now cost in the region of R10 000 to replace. This issue of replacement cost is something that the public often don’t take into consideration, and in our experience is an issue that clients need to have explained to them.

 

Of course, while it is quite rare that an entire wardrobe would need to be replaced, should a client suffer a break in or fire, it is vital for them to have apportioned the correct replacement value to their wardrobe to ensure everything can be replaced if necessary.

 

There are various tips you can employ to help clients work out the true cost of their wardrobe. One of these is to divide the clothes into sections such as business, casual, evening and sports. This should help the client to have a better idea of what clothes they actually have so that they can make a more accurate valuation. This also helps to highlight those items that one forgets about but refuses to throw away.

 

If your client also has a large number of expensive or designer outfits, it can be a good idea to suggest a professional valuer to assist them in the process. At MUA we provide a professional valuation service to all of our clients, so that they know exactly how much their wardrobes are worth.

 

It is easy to underestimate the value of a woman’s wardrobe, especially if the clothes were bought many years ago. However, by being proactive your client will end up saving thousands in the long run and will truly see the value of their broker.

 

Another addition to insurance is cover for their handbag and its contents. It has become quite acceptable for women to spend large amounts on expensive designer branded handbags, in line with what was spent on jewellery pieces in the past.  A designer handbag can cost thousands itself, before one even assesses the value of its contents such as keys, make-up, MP3 player, cell phone and wallet.

 

Insuring a handbag is a relatively cheap addition to any policy but it is crucial for all women and it is a suggestion that your female clients will be hugely appreciative of should they ever have the need to make a claim.

 

A broker that takes the time to explain these issues and obtain a proper valuation for their client’s personal items is not only able to highlight their own worth to their client, but they also keep their customer book bulging as much as their client’s wardrobes.