| Frequently Asked Questions |
| Property Insurance
All
Insurance | Life
Insurance |
General Non-Life Insurance |
| What are the extra
benefits attached to my building policy? Professional Fees (such as Architects, Surveyors, etc.) up to a limit of 10% of the Sum Insured. Loss of Rent up to a limit of 10% of the Sum Insured. Cost of the Removal of Debris, subject to the Insurance Company giving consent prior to such removal. Property Owners' Liability, i.e. indemnity for Third Party injury or damage caused by any defect in the property covered and for which due to your ownership you are liable. These four extra benefits are included in your comprehensive building policy. What is the difference between "General Contents" and "Specialised Contents"? "General Contents" are all
your household possessions, e.g. electrical appliances,
furniture and fittings including your clothes and food stuff. Fire, Lightning, Explosion. The value is what your contents are
worth at a particular point in time. The Sum Insured Value, as
stated in the policy, is maximum an Insurance Company will pay
under the policy. Make a report to the Police and get
name and badge number of the Officer's. Report the loss to the Insurance
Company immediately and then in writing within two weeks. For Theft: Most polices only covers retaining walls if
the house depends directly on them for support. If they are
metres away from the house, they are not insured by the policy
and their value should be excluded from the sum insured
proposed. Not in all circumstances. Your policy
covers Collapse following Subsidence and Landslip. Retaining
walls often fall down because their foundations were
inadequate, or because insufficient holes were provided in
them for water to drain from the earth behind them; the sheer
weight of water after heavy rains pushes the wall down.
Insurers do not intend to pay for such damage.
NEMWIL’s policy is issued to cover
private dwelling houses. In charging a premium we have
anticipated only the level of hazards one would normally
associate with a residence. We even allow "domestic
offices" - the occupant may work at home if he/she is in
an "office" type occupation such as doctor,
physiotherapist, architect, engineer, transcription typist,
insurance agent, and does not have more than one employee. We
do not agree to any other commercial occupation; excluded
would be such obviously high Fire hazard occupations as auto
mechanic, welder, but also things like the stocking of goods
for retail sale or distribution, a part-time catering
business, a nursery school. What is being described above is
called OVER INSURING. This is not advised since
insurance coverage is based on items’ Current Market Values.
Consequently, claim settlements are based on the lost or
damaged items’ values, adjusted for ‘wear and tear.' Any
settlement would be based on reinstating the insured back to
the position that he or she was in before the loss or damage
(preferably with items of the same type or kind). What this
means is that no person should be able to benefit financially
from a claim by receiving more than what he or she had before
the loss. Thus, over insuring property and valuables does
nothing to further benefit the insured, in fact, what such a
practice does, is that it causes, the insured, to pay more
premium than is really needed. You can however select the ‘Reinstatement
as new’ option (New for Old)
which allows you to insure at a value that represents the cost
of replacing the items as new. No adjustment for wear and tear
is made on a claim in such circumstances. Example #1 UNDER INSURED PROPERTY Actual Market Value: $250,000 Sum insured (given by owner): $200,000 Loss following a fire: $100,000 Amt. Payable: $200,000/$250,000 x $100,000 = $80,000 (note that this is lower than the actual loss) Example #2 INSURED PROPERTY (at market value) Actual Market Value: $250,000 Sum insured (given by owner): $250,000 Loss following a fire: $100,000 Amt. Payable:$250,000/$250,000 x $100,000 = $100,000 Remember, the only way that you can
absolutely be sure that your property is valued at its current
market value is by performing a periodic valuation. It is also
very important that one be done after any renovations or
improvements. Homeowners insurance is one of the
most popular forms of personal lines insurance on the market
today. The typical homeowners policy has two main sections:
Section I covers the property of the insured and Section II
provides personal liability coverage to the insured. Almost
anyone who owns or leases property has a need for this type of
insurance. And many times, homeowners insurance is required by
the lender as part of the requirements in obtaining a
mortgage. [Note: this answer is based on the
Insurance Services Office's HO-3 policy.] Coverage C, which provides named
perils coverage, applies to all your personal property
(except property that is specifically excluded) anywhere in
the world. For example, suppose that while traveling, you
purchased a dresser and you want to ship it home. Your
homeowners policy would provide coverage for the named perils
while the dresser is in transit - even though the dresser has
never been in your home before. Direct damages due to earthquakes are
not covered under the standard homeowners insurance policy.
However, unless you live in an area that is prone to
earthquakes, you probably do not need this coverage. If you do
live in a part of the country with high earthquake activity
you may want to consider adding an earthquake endorsement
to your homeowners insurance policy. This endorsement will
cover damages due to earthquakes, landslides, volcanic
eruptions and other earth movements. There are a number of factors you
should consider when purchasing any product or service, and
insurance is no different. Here is a checklist of things you
should consider when you purchase homeowners insurance. First
and foremost, purchase the amount and type of insurance that
you need. Remember that if your policy limit is less than 80%
of the replacement cost of your home, any loss payment from
your insurance company will be subject to a coinsurance
penalty. Also, determine the amount of personal property
insurance and personal liability coverage that you need.
Second, determine which, if any, additional endorsements you
want to add to your policy. For example, do you want the personal
property replacement cost endorsement or the earthquake
endorsement? Finally, once you have decided on the
coverage you want in your homeowners insurance policy, you can
now decide which insurer you would like to purchase the
insurance from. Some people like the idea of purchasing
insurance from a mutual company rather than a stock company.
You should also decide whether you would like an insurance
agent to assist you in your purchasing decision or if you
would like to buy the product directly from an insurer without
the assistance of an agent. There are a number of things you can
do to lower the cost of your homeowners insurance. The best
thing to do is to shop around. It is not surprising to find
quotes on homeowners insurance that vary by hundreds of
dollars for the same coverage on the same home. When you shop,
be careful to make sure each insurer is offering the same
coverage. Many insurers use the ISO policy forms, but
this is not always the case. Another way to lower the cost of
your homeowners insurance is to look for any discounts that
you may qualify for. For example, many insurers will offer a
discount when you place both your automobile and homeowners
insurance with them. Other times, insurers offer discounts if
there are deadbolt exterior locks on all your doors, or if
your home has a security system. Be sure to ask your agent or
company about any discounts that you may qualify for. Another
easy way to lower the cost of your homeowners insurance is to
raise your deductible. Increasing your deductible from $250 to
$500 will lower your premium, sometimes by as much as five or
ten percent. However, be careful to make sure that you have
the financial resources necessary to handle the larger
deductible. Insurance contracts are conditional
contracts, which means that policyowners have certain
duties that they must perform if a covered loss occurs.
Failure to complete these actions can, and sometimes does,
result in non-payment by the insurance company for losses that
otherwise would have been covered. This coverage protects the contents of
your home against theft, loss or damage from a fire or other
covered event. Generally, personal property will be equal to
50% of the replacement coverage amount for your home. Payments
are made typically on an actual cash value basis, which may be
lower than the replacement cost of the property. Covered losses under a homeowners
policy can be paid on either an actual cash value basis
or on a replacement cost basis. When "actual cash
value" is used the policyowner is entitled to the
depreciated value of the damaged property. Under the
"replacement cost" coverage, the policyowner is
reimbursed an amount necessary to replace the article with one
of similar type and quality at current prices. A named perils policy covers
losses that are due to only those perils listed in the policy.
The perils typically covered include fire, windstorm, hail,
and other direct physical losses. An all risks policy
covers losses that are due to any peril except those
specifically excluded in the policy. It is important to note
that all risks policy provides broader protection than
do named perils policies. In the unfortunate event that you are
sued, your homeowners policy will not only cover the cost of
your legal defense, but your insurance company will also
provide the legal counsel. There are 2 parts to a homeowners
policy - property and liability. Remember that policies vary, but
homeowners insurance usually covers damage to both structures
and personal property caused by fire or lightning, windstorm
or hail, wind damage from hurricanes and tornadoes,
explosions, riot or civil commotion, aircraft, vehicles,
smoke, theft or vandalism (sometimes called malicious
mischief), falling objects, weight of ice, snow or sleet, and
freezing of a plumbing, heating, air conditioning or other
household systems. Flood and earthquake damage, however, are
usually excluded from a standard policy. In addition, is some
states (like Florida and Hawaii) hurricanes may be excluded
from the standard homeowners policy. Unfortunately, if most of us suddenly lost all our possessions due to some calamity, we would be hard pressed to know all that was gone. When was the last time, for example, that you counted the pairs of shoes you own, or inventoried your Cds -- not to mention listing all your furniture, dishes, drapes, or audio and video equipment, etc.? How much is it all worth and where would you start if you had to replace it? Now is the time to make a list of major household items and possessions. Just remember that, where possible, it is wise to list the serial number, date and cost of purchase, and even include the receipt if you can. Another easy way to inventory your home is to use a video camera or take still photos of your home and its contents. Using a video also lets you record information about the items and their date and cost of purchase. Whether your record is on film, video or paper, have a copy made and ask a friend or family member to keep it. Or store your copy in a safe deposit box. Then, if the worst happens and your home is destroyed, the inventory record will be safe at another location. Earthquake, Flood and Hurricane Insurance These type of coverages provide added
protection in geographic areas prone to certain types of
natural occurrences. They are usually carried on a voluntary
basis, but are sometimes required. Direct damages due to earthquakes are
not covered under standard homeowners insurance policies.
However, unless you live in an area that is prone to
earthquakes, you probably do not need this coverage. If you do
live in a part of the country with earthquake activity, you
may want to consider adding an earthquake endorsement to your
homeowners insurance policy. This endorsement will cover
damages due to earthquakes, landslides, volcanic eruptions and
other earth movements. Often, flood insurance is required as a condition of granting a mortgage loan if your home is in a special flood hazard area. Even if you live in a low hazard flood area your property may still be at risk. Each year, about 35% of all flood claims paid are for property located outside high-risk areas. The good news is that there is a Preferred Risk program that offers substantial premium discounts for homes located in low hazard areas. If you think your home is at risk, you might want to consider purchasing flood insurance. Or you can check out special flood insurance maps published by FEMA (the Federal Emergency Management Agency). These maps (which indicate a community's flood hazard areas and the associated degree of risk) are usually kept on file at your local town hall or county building and are available for your review. Condominium Insurance This policy includes many of the same
coverages as the homeowners policy, including protection for
personal property, loss of use, personal liability and medical
payments for others. It also covers any additions,
alterations, fixtures, and installations within the perimeter
walls, floor and ceiling of the unit. The homeowner's
association is typically responsible for providing insurance
on the external building and any common areas. All
Insurance | Life
Insurance |
General Non-Life Insurance
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