80% of South African homeowners are underinsured: Expert

Senior adjudicator at a home insurance company has revealed that 80% of South African homeowners are underinsured. As extreme weather events become more frequent and more destructive, there are growing concerns that many homeowners remain financially exposed when disaster hits.

Recent industry reports show weather-related damage is now amongst the leading drivers of insurance claims in the country with flooding, storm damage, and water-related losses rising sharply.

Experts are also warning that many homeowners only discover gaps in their cover after suffering major damage.

Janitra Hollenberg explains, “80% of South African households are underinsured by almost 50% of their assets’ actual value. And that poses significant concerns because in the event of a loss, that means that your claim is going to be cut down by your underinsurance ratio. Policyholders don’t read their policies and a number of policyholders don’t actually understand what they’re covered for. There’s a huge misconception, for example, that if something breaks or is damaged, my insurer will pay for it, and the reality is quite different.”