By Insure City Insurance Brokers (Pty) Ltd

Insurance Policy Renewal Overview

The annual renewal of an insurance policy constitutes a new contractual agreement, which may include amended terms and necessary adjustments — whether initiated by the insurer, reinsurer, or influenced by market trends.

Insured Values

Many policyholders assume that everything remains unchanged at renewal. While this is sometimes the case, it’s especially important to consider inflationary adjustments for buildings, commercial properties, and sectional/full title schemes.

Buildings are insured for their total replacement value, which includes costs such as:

• Rebuilding from scratch
• Site safety preparation
• Debris removal
• Municipal charges

For example, if you purchased a building for R1,500,000 last year, the cost to rebuild it today would likely be higher due to increased labour, material costs, and other external factors. It is your responsibility as the owner to ensure that the insured value is updated accordingly. If your insurer does not make this adjustment, you should.

At Insure City, we apply a discretionary 10% inflationary adjustment on buildings and all-risk items at renewal to help ensure our clients remain adequately covered. This adjustment is not mandatory and can be increased or decreased based on your own assessment.

Note: Valuations are legally required for all sectional title schemes at least once every three years.

Terms and Conditions

Policy terms — such as excess structures, additional requirements, or limitations — may change upon renewal. For example, an insurer may replace a fixed excess with a percentage-based excess to reduce exposure to a specific risk.

Example

If you’ve had multiple geyser claims in a year, the insurer might change the excess from a fixed R1,000 to 10% of the claim amount, with a minimum of R3,500.

These types of changes are common during renewals. It is therefore crucial to read your renewal schedule and documents carefully. If changes go uncontested, it is assumed that you accept the new terms, and coverage continues accordingly.

Your Responsibility

Always compare your renewal schedule with your previous one. If you notice any changes you are not comfortable with, raise them with your insurer. Staying informed ensures you remain properly covered and avoid surprises during claims.

Email: info@insurecity.co.za
Tel: +27 (12) 426 3400