So, maybe your business is service based which means you only have offices…or maybe you own a factory with adjacent offices for your accounting and sales staff?
And what if you’re an attorney or accountant with trust or mortgage deeds in your possession?
Whatever your situation you need office contents insurance!
What am I insured for under the office contents section?
The office contents section provides indemnity against five different risks.
The risks in question are:
- Loss or damage to contents caused by one of the insured perils
- Rent payable by you as a tenant while the premises are uninhabitable as a result of one of the insured perils. This is limited to 25% of the sum insured.
- Loss or damage to documents kept at the office (Important for attorneys!) by one of the insured perils. This is limited to the cost of restoring or replacing these documents.
- Legal liability you might face as a result of loss or damage to important documents in your possession at the time of the loss
- The increased cost of working in order to maintain the normal operation of the business after loss or damage to the contents by one of the insured perils. This is limited to 25% of the sum insured of the contents.
So when can you claim under the office contents section?
A claim under this section can be made if any of the following occurs:
- Fire, lightning, thunderbolt, subterranean fire, or explosion
- Storm, wind, water, hail, or snow (with certain exceptions)
- Aircraft and aerial devices dropping from them
- Impact by animals, trees, aerials, satellite dishes, or vehicles
- Accidental damage of mirrors, plate glass tops of furniture or fixed glass forming part of the furniture
Once again ‘average’ can be applied to this section (unless the claim is as a result of accidental damage!).
What isn’t covered under the office contents section?
- Property outside the RSA and certain surrounding African countries
- Design patterns, models, moulds, samples, stock, money, stamps, jewellery or precious stones
Are there any extensions that I can add to this section?
Yes, there are three optional extensions available!
- The riot and strike extension
This only applies outside of RSA and Namibia.
Riot and strike in the RSA and Namibia are covered by the specialist insurer SASRIA and can be added to your schedule for a small nominal fee.
- Theft by forcible entry extension
Theft accompanied by forcible and violent entry or exit from the offices. This includes theft accompanied by violence or threats of violence. The amount of theft cover will usually be specified under this extension.
- Theft extension
Theft or attempted theft by anyone other than a director, partner, or employee of the insured. Theft does not have to be accompanied by violence or forcible and violent entry or exit. The amount of theft cover will usually be specified under this extension.
What do I get automatically included under this section?
- Capital additions clause
This covers any alterations or additions made to the premises of which the insurer is unaware. This is limited to 15% of the sum insured.
- Fire extinguishing clause
The good ole costs of extinguishing a fire are included here
- Locks and keys clause
If you have reason to believe that your office keys ‘have grown legs and walked’, this clause will cover the cost of replacement up to an amount (usually R1,000).
- New and additional premises clause
So you’ve acquired new premises in the RSA (or one of the neighbouring countries reflected in your schedule)! You will enjoy office contents cover on the new premises even though you haven’t notified the insurer as yet. Of course, you need to notify the insurer of the new premises within a reasonable period of time in order to enjoy cover here…a claim two years after occupation won’t cut it under this clause!
- Removal of debris clause
You’re going to have to pay someone to remove the junk, and this clause takes care of it!
- Temporary removal clause
Loss or damage caused to the office contents while being temporarily stored in any building elsewhere in the RSA (or selected neighbouring countries) is provided for by this clause.
- Temporary repairs and measures after loss clause
This clause covers all reasonable costs incurred by you in making temporary repairs to the offices. These temporary repairs must, of course, be necessary.
- Tenants clause
So your tenant breaks the terms and conditions of your office contents cover? This clause covers your back as owner of the insurance!
- Replacement value condition clause
Contents will be replaced with similar property so that a situation is reached where replacement is equal to but not better than the previous office contents when new.
If the items can be repaired then repairs will be done so that the contents are in the same condition as when new.
The proviso is that if the contents in total are underinsured then the insured will be seen as self-insured and will bear a portion of the loss. In other words, if the sum insured is R250, 000 and an assessor determines that the replacement value is closer to R500, 000, then you are liable for 50% of the claim amount!
- Malicious damage extension
If someone willfully and deliberately damages your office contents then this extension comes to your rescue! Please note that there are conditions applicable to this.
And there you have it…
If your business is an office based business then this cover is a must. If you’re an attorney or accountant then this type of cover is vitally important.
In our next instalment I’ll cover another of the risks which can cripple your business – the vitally important business interruption section of your commercial insurance policy – don’t miss this one!
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