Most homeowners in Kenya look at insurance as a luxury and not a necessity. However, this is not the case.
We all know somebody who’s home has been affected by fire, flood and burglary. Home insurance provides the single best way to protect your home from any unforeseen incidents.
What’s more, insurance isn’t always your choice. Most mortgage lenders have home insurance as a prerequisite. They want to know their investment is protected.
This covers the cost of repairing damage to the structure of your property. It includes the building itself plus attached structures like your garage, the front and back porch.
Most policies stipulate that repairs are to be made using the same quality and type of materials as what was lost.
And in the event of a total loss, the cover takes care of complete reconstruction to replace the building if a covered hazard causes the damage.
The damages covered under a dwelling cover differ from one provider to another but are commonly:
- Fire and explosions
- Theft, attempted burglary and vandalism
- Burst pipes
- Fallen trees, aerial or satellite dishes
- Vehicle or aircraft collisions
- Falling objects
The limit on compensation in the case of a total reconstruction is based on the cost of rebuilding your home and not necessarily its market value.
This will generally cover labour costs, materials, any professional fees and clearing costs. Your insurer will calculate this cost based on the information you give when taking the cover.
Contents Coverage
This protects the personal belongings in your home against theft or damage. These include items like gadgets, furniture and kitchen equipment.
With contents insurance, your insurer replaces your old items with new ones. For example, if your television is stolen, you get compensated with an equal one.
If you have other valuable items, e.g. an expensive piece of art, you can also have this included in your cover for some extra shillings.
However, for such items, your insurer may put a limit on how much to compensate you due to their worth. This could be between 50% – 70% of the initial purchase price.
The best way to ensure that you have adequate cover is to walk around your home, room by room taking an inventory of your belongings.
In addition to having a list, take photos, record serial numbers and year of purchase. You should also attach official documentation like receipts. This will help you estimate how much your belongings are worth and will come in handy when filing a claim.
While content coverage can be taken up separately, you have the option to have it as an add on to your home insurance package.
Personal Liability Coverage
This coverage protects you in the event of an accident in your home that results in bodily injury or property damage that you are held responsible for.
It includes covering legal fees and medical bills if a guest is injured in your property. You will also be protected in case you cause accidental damage to someone else’s property.
The good news is it not only covers your liability but that of your family members who live within your home.
However, personal liability does not cover:
- Accidents caused by an automobile; your auto cover should have provision to handle this.
- Bodily injury or property damage caused intentionally by either you or your family members.
- Injuries or damages sustained by you or your family members at home; a health cover should handle this.
Loss of Use Coverage
Also known as Additional Living Expense (ALE) coverage, this takes care of costs you may incur for housing and living expenses if an event makes your home temporarily uninhabitable due to a covered loss.
In simpler terms, ALE covers your expenses that wouldn’t have normally incurred when you were living at your home. These could include:
- The cost of temporary housing such as a hotel
- Moving costs
- Taking public transportation
- Excess of regular food expenses
- Storage costs for household items
Every insurance provider offers slightly different compensations, so check with your provider to find out what items are on their list. You should also get clarity on limitations like the maximum benefit amount on temporary living expenses.
Most insurance companies will cover between 10-20% of your dwelling place value. This means if your home is valued at Khs 3,000,000, the cap would be between Kshs 300,000 – Kshs 600,000.
Employer Liability
If you have contractors, casual workers, permanent or temporary staff, this cover helps you to deal with any claims from employees who have accidentally been injured or become ill when working for you.
It’s important to note that this is a mandatory requirement for all employers according to the Work Injury Benefits Act of Kenya. This applies to anyone hired under your roof.
Same as the Loss of Use coverage, insurance companies will put a limit on the maximum benefit you can get for Employer Liability. Britam Kenya, for instance, has a limit of Kshs 500,000.
What Home Insurance Doesn’t Cover
Unfortunately, not all losses are taken care of by your home insurance cover. These will vary from one company to another, so ensure that you have a clear picture before signing on the dotted line.
Knowing what insurance does not cover helps you save time from making claims that your insurance company will not accept.
Let’s take a look at some of the key ones.
Earthquakes, Lightning & Floods
In insurance terms, catastrophes caused by natural acts of God, i.e. have no human control, are not covered in your standard homeowner’s package.
These include fire caused by lightning, earthquakes and flooding.
The good news is, with the evolving insurance industry in Kenya, some companies now offer these separately. You should check with your insurance company if they have separate coverage for these normally excluded events.
Home Maintenance Issues
Your insurer will not cover damages that are caused by you, primarily due to neglect or failure to maintain your home. Ensure to fix your leaking taps, avoid clogging the pipes and schedule routine maintenance.
Other things that your insurer will not cover include damages caused by insects, rodents, and general wear and tear. Fumigate your home as soon as there are signs of pests, generally observe caution and maintain cleanliness.
