Body Corporate / Sectional Title Insurance in South Africa

Obtaining proper insurance cover, is one of the most essential duties placed on the Trustees of Bodies Corporate and great care should be taken in performing this duty.
 Body Corporate or Sectional Title Insurance - Provides indemnity cover agains multiple perils
Body Corporate Insurance covers the buildings, all fixtures and fittings of permanent nature,
liability & indemnity insurance against perils that are specified in the Act

Why Body Corporate or Sectional Title Insurance:
Many owners of Townhouses or Sectional Title units are under the 'mistaken' impression that the Buildings or Body Corporate's Insurance policy, covers the buildings, the common property and all fixtures within the sections, as well as all the 'movables', such as furniture, curtains, loose carpets, etc. However, this is not the case!

It is the duty of the Trustees of the Body Corporate to ensure that the buildings and all improvements to the 'common' property are adequately insured, while the onus for insurance on all the 'moveable' items, falls on the individual residents. It is therefore imperative that occupiers in Sectional Title units insure their own household goods separately to ensure cover, should their unit be broken into.

Body Corporate Insurance is a special offer for the collectives that manage the buildings and communal areas of a residential complex or building.

Body Corporate Insurance policy covers the building(s), all fixtures and fittings of permanent nature (eg. the sanitary ware, fitted carpets & cupboards), liability and indemnity insurance against perils that are specified in the Act, as well as other perils that the members may decide are required to include. Perils such as acts of nature (hail, wind, lightning, storms, floods, earthquakes), damage caused by leaking or burst geysers (or water heating systems/apparatus) and its pipes or parts (obviously excluding damage due to rust or normal wear and tear), fire, riots, labour disturbances, and loss of occupation or loss of rent, as a result of these risks, etc., should all be taken into consideration.

One of the most important items on the list of Sectional Title Trustee duties, is to ensure that all the buildings and improvements to the common property within their sectional title scheme, is insured to the right replacement value – this is something that should be discussed at every Annual General Meeting. It is further advised to have the buildings and improvements professionally valued every three to four years (eg. preferably by a certified professional Valuer or qualified Quantity Surveyor), so as to ensure that the replacement values applied are reasonable and accurate.

Common property, is with reference to items such as: Walls (boundary), fences, gate motors, entrances, drive or pathways, security & security cameras, irrigation, swimming pool, braai area, gardens (including garden tools, equipment and garden/swimming pool area furniture), fire extinguisher equipment, etc.

DIB Solutions (Pty) Ltd have partnered with reputable underwriters and various insurance companies in order to assist our clients with appropriate Insurance cover – we can therefore also assist clients with tailor-made products (where applicable) at competitive premiums. We provide a professional and personal service, as well as build long-term relationships with our clients. Being a specialist niche area, all product options should be considered. These options may be confusing – therefore discuss your individual needs with one of our experts.
 

Note the following with regards to Body Corporate or Sectional Title Insurance::
 
  • Under Sectional Title or Body Corporate Insurance, normal perils should include acts of nature, such as: Hail, wind, storm, weather damage (storm, lightning), earthquake;
  • Are Fire and Explosions covered under your policy? Or damage caused by the leakage or discharge of fire extinguishing equipment?
  • Is normal risk such as theft of, or any damage caused by attempted theft of fixtures and fittings, covered?
  • Check if your Body Corporate Insurance includes cover for civil commotion, SASRIA (riot and public disorder), public liability, trustees liability, labour disturbances and more;
  • Are the water pipes and geysers (i.e. the water heating systems) covering loss or damage following the leaking and bursting, under your Body Corporate Insurance?
  • Is loss of rent in terms of risk, covered in your Body Corporate Insurance? Otherwise consider as an additional option of cover;
  • Check your Sectional Title or Body Corporate Insurance policy: Is bursting and/or overflowing of pipes and water tanks also covered? Is slow leak damp over time, covered?
  • A typical Sectional Title or Body Corporate Insurance policy should include all the above, as well as perils such as: Power surges, fidelity, trustee liability, loss of water, locks and keys (eg. following a burglary), subsidence and landslip, accidental & intentional damages, to name just a few;
  • Claims against liability and accidental, can be managed & mitigated by ensuring and avoiding the following: Keep storage units clean, avoid loose fittings & pipes, loose bricks, tiles and paving, store gas safely and steps must have hand rails, communal braai area chimneys are up to standard, swimming pool properly enclosed. A safety expert can be consulted to audit the common property for fire and safety requirements;
  • Also avoid dangerous electrical connections.
Owners of Section Title units should have an updated copy of the Body Corporate’s policy and be informed of the rules, also with regards to excess, i.e. who pays the excess under which circumstances.
 

Please contact us today for fast, friendly, professional advice and service!

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