Insurance for Buildings
1
In order to avoid certain headaches with regards to insurance, it is of great importance to understand what exactly is included in the concept of insurance for buildings; what should be insured; and by whom. Neglect of correct building insurance or no insurance at all can have far reaching financial consequences and leave a building owner with empty pockets or even worse - a claim for the loss of someone’s life. With building insurance, all buildings belonging to the owner, are insured. The only property that is excluded is property belonging to the lessee or that which is deliberately excluded in the rental agreement. It remains the building owners’ sole responsibility to ensure that their building is built according to the Building Regulations. Often a house is bought “voetstoots” and the buyer assumes that if damages are caused - for instance - by water due to a defectively built roof, he or she can claim for this, but it qualifies as an exclusion in all policies. Defective workmanship, wear and tear as well as poor Maintenance are all excluded in Building Insurance Policies. It remains the responsibility of the building owner to ensure that the property complies with legislation. Furthermore, the fact that the Building Insurance Policy requires the building owner to take all reasonable steps to ensure that the insured property complies with the National Building Regulations and Building Standards Act No 103 of 1977; that all building plans are adhered to and approved by the local authority; and that statutory obligations, laws, bylaws, regulations and safety requirements and statutes and regulations in this regard, are fully complied with at all times. Futurum Financial Group (Pty) Ltd is a Licensed Financial Services Provider, FSP 654. FFG Group of Companies Futurum Financial Group futurumfinancialgroup FFG_Group NATIONAL BUILDING REGULATIONS / STATUTORY REQUIREMENTS You must take all reasonable steps to ensure that the insured property complies with the National Building Regulations and Building Standards Act (No. 103 of 1977) as amended or substituted from time to time, or any similar applicable legislation, and the regulations thereto. You must also take all reasonable steps to ensure that plans were submitted to and approved by the local authority at the relevant time of construction. You must also comply with all statutory obligations, laws and bylaws, regulations, safety requirements and statutes and regulations thereto imposed for the safety of property or persons. FUTURUM FINANCIAL GROUP AUTHORISED FINANCIAL SERVICES PROVIDER Compliance with all these requirements will ensure the safety of the property or persons and warrants that the insurance company will respond to relevant claims. It is equally important for building owners to acquaint themselves with the specific requirements determined by the “Compliance” systems that should be observed in accordance with the SANS National Building Regulations of South Africa. Even though developers are duly aware of these requirements, it is still important to have this information communicated to the building owner. If the regulations are consulted, for instance SANS 10287 stipulating the exact sprinkler system to be installed; or SANS 10400 that governs the design of properties and the requirements it must meet, one will be comforted by the thought that adherence to all these regulations might just exclude legal responsibility in case of a third party claim, since reasonable precaution was applied. Building owners should thus at all times be aware of what they could be kept liable for if their insurance cover is not in place. Loss of life liability, is but one instance. An example where an owner rented out his house without having the correct Fire Certificates and Electrical Fire Certificates when he bought the house “voetstoots”. He neglected having these aspects checked out. A fire occurred in the building and the lessee passed away in the fire. As the building belonged to the owner, the insurance claim was lodged against his Personal/ Business Policy. The family of the lessee sued the owner for loss of life for over R28 million. The owner was left without the option to sue any third party for the costs incurred in this regard, since he had neglected to ensure that all the requirements regarding the necessary regulations and legislation were met. REASONABLE PRECAUTIONS You as well as your employees, representatives and agents, must do all that you reasonably can do to prevent legal liability, or loss or damage to the insured property, and to maintain such property in a sound condition and in a good state of repair, including repairing faults or fixing defects to items such as (but not limited to) roofs, gutters, drains, water pipes and tiled areas when they leak or need repairs. Insurance for Buildings by Cyrese Erasmus, Senior Portfolio Manager, FFG. AUG 2020 FUTURUM FINANCIAL GROUP AUTHORISED FINANCIAL SERVICES PROVIDER WESTERN CAPE AUTHORISED FINANCIAL SERVICES PROVIDER AUTHORISED FINANCIAL SERVICES PROVIDER AUTHORISED FINANCIAL SERVICES PROVIDER FFG CAPITAL MAURITIUS
Transcript of Insurance for Buildings
In order to avoid certain headaches with regards to insurance, it is of great importance to understand what exactly is included in the concept of insurance for buildings; what should be insured; and by whom.
Neglect of correct building insurance or no insurance at all can have far reaching financial consequences and leave a building owner with empty pockets or even worse - a claim for the loss of someone’s life.
With building insurance, all buildings belonging to the owner, are insured. The only property that is excluded is property belonging to the lessee or that which is deliberately excluded in the rental agreement.
It remains the building owners’ sole responsibility to ensure that their building is built according to the Building Regulations. Often a house is bought “voetstoots” and the buyer assumes that if damages are caused - for instance - by water due to a defectively built roof, he or she can claim for this, but it qualifies as an exclusion in all policies. Defective workmanship, wear and tear as well as poor Maintenance are all excluded in Building Insurance Policies. It remains the responsibility of the building owner to ensure that the property complies with legislation.
Furthermore, the fact that the Building Insurance Policy requires the building owner to take all reasonable steps to ensure that the insured property complies with the National Building Regulations and Building Standards Act No 103 of 1977; that all building plans are adhered to and approved by the local authority; and that statutory obligations, laws, bylaws, regulations and safety requirements and statutes and regulations in this regard, are fully complied with at all times.
Futurum Financial Group (Pty) Ltd is a Licensed Financial Services Provider, FSP 654.FFG Group of Companies Futurum Financial Group futurumfinancialgroupFFG_Group
NATIONAL BUILDING REGULATIONS / STATUTORY REQUIREMENTS
You must take all reasonable steps to ensure that the insured property complies with the National Building Regulations and Building Standards Act (No. 103 of 1977) as amended or substituted from time to time, or any similar applicable legislation, and the regulations thereto. You must also take all reasonable steps to ensure that plans were submitted to and approved by the local authority at the relevant time of construction. You must also comply with all statutory obligations, laws and bylaws, regulations, safety requirements and statutes and regulations thereto imposed for the safety of property or persons.
FUTURUM FINANCIAL GROUPAUTHORISED FINANCIAL SERVICES PROVIDER
Compliance with all these requirements will ensure the safety of the property or persons and warrants that the insurance company will respond to relevant claims.
It is equally important for building owners to acquaint themselves with the specific requirements determined by the “Compliance” systems that should be observed in accordance with the SANS National Building Regulations of South Africa. Even though developers are duly aware of these requirements, it is still important to have this information communicated to the building owner. If the regulations are consulted, for instance SANS 10287 stipulating the exact sprinkler system to be installed; or SANS 10400 that governs the design of properties and the requirements it must meet, one will be comforted by the thought that adherence to all these regulations might just exclude legal responsibility in case of a third party claim, since reasonable precaution was applied. Building owners should thus at all times be aware of what they could be kept liable for if their insurance cover is not in place. Loss of life liability, is but one instance.
An example where an owner rented out his house without having the correct Fire Certificates and Electrical Fire Certificates when he bought the house “voetstoots”. He neglected having these aspects checked out. A fire occurred in the building and the lessee passed away in the fire. As the building belonged to the owner, the insurance claim was lodged against his Personal/ Business Policy. The family of the lessee sued the owner for loss of life for over R28 million. The owner was left without the option to sue any third party for the costs incurred in this regard, since he had neglected to ensure that all the requirements regarding the necessary regulations and legislation were met.
REASONABLE PRECAUTIONS
You as well as your employees, representatives and agents, must do all that you reasonably can do to prevent legal l iability, or loss or damage to the insured property, and to maintain such property in a sound condition and in a good state of repair, including repairing faults or fixing defects to items such as (but not limited to) roofs, gutters, drains, water pipes and tiled areas when they leak or need repairs.
Insurance for Buildings
by Cyrese Erasmus, Senior Portfolio Manager, FFG. AUG 2020
FUTURUM FINANCIAL GROUPAUTHORISED FINANCIAL SERVICES PROVIDER
WESTERN CAPEAUTHORISED FINANCIAL SERVICES PROVIDER AUTHORISED FINANCIAL SERVICES PROVIDER
AUTHORISED FINANCIAL SERVICES PROVIDER
FFG CAPITAL MAURITIUS
