The popularity of luxury estate living has boomed in South Africa over the last five years, with a proliferation of themes such as golf, polo, wine, and wildlife estates. This explosion in demand has prompted the South African insurance industry to develop a new form of bespoke insurance to help meet the specific needs of such residents.
According to Jonjon Smit, Sales Director at CIB Insurance Solutions (CIB), residents of lifestyle estates have a unique set of insurance requirements, which needs to be factored into policies. “In order to ensure they are properly protected, these residents require an insurance policy that meets their own specific needs, which can change dramatically depending on the type of lifestyle estate they reside in.”
“For example, residents of wildlife estates such as Pezula in Knysna need covere to protect them from wild animal damage to their dwellings, while residents of golf estates would need cover for golf carts being used on the estate and broken windows,” says Smit.
Alongside the unique risks that a lifestyle estate may incur, the improved security measures employed at such estates mean that residents often benefit from far cheaper rates on their policies. “The high-tech security features, manned entrances and signing in policies at estate gates combine to make the threat of robbery highly unlikely at luxury estate homes.”
As a result estate insurance can often exclude certain factors deemed vital for any other type of insurance. “Homeowners taking out contents insurance for a house on an estate can opt to exclude theft from the policy, which obviously helps to bring down the premium. It can even be tailored so that only individual items are insured for theft such as TVs and expensive electronic equipment.”
Smit says the most common kind of claim that CIB faces on its estate insurance product is that of loss for small items seen as ‘petty theft’, as well as damage from natural occurrences such as storms or lightning and occasionally fire damage.
“Many policies require all risks items above R1 000 to be specified but for residents of estates – who are likely to have many gadgets – we realise that this figure is far too low, and have increased the benefit to R50 000 with a limit of R25 000 per item, depending on the location of the estate.”
Smit says estate insurance often combines all types of insurance into one policy such as motor, buildings and contents insurance. Such policies also tend to provide far higher service levels.
“Service levels have to be impeccable with estate insurance. Much of the business is through referrals and word of mouth. We tend to insure many houses within one estate so service is paramount. You cannot afford to upset one customer as that could affect an entire estate.”
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