After the column, in which I chatted about insurance
, Clive sent this:
Q
: Dear Don, A comment about building insurance. I have always believed if my house burns down, even totally, I will still be left with the land. In the area in which I live, three-bedroom freehold houses typically sell for around R2.5 million, including land. How does this all fit in with insurance?
A
: I love questions on one of my favourite topics and assure you that the market value of your property in no way reflects what it should be insured for – the figures could be poles apart. Working backwards, the area in which a person lives could deteriorate over the years, reducing the value of the property.
Conversely an area could become a sought-after suburb and property prices would then rise. Neither of these two events would affect what it would cost to rebuild your home if it were destroyed by fire.
Your building insurance insures the value of the bricks and mortar, not the land.
You need to be insured for:
- Professional fees – architects and engineers to produce drawings for a new building.
- This might not be necessary if the building is to be replaced exactly as it was, but it is a requirement of most insurers.
- An allowance for demolition – the remains of your property have to be demolished and carted away.
- The cost of rebuilding your home at current rates, not what it cost to build initially. This is often where people are caught. The price to build in a complex, where many houses are being built at the same time, could be cheaper than doing it as a once-off
after a fire. Another thing to watch out for is types of materials used – if you want to replace teak windows and doors with similar, you need to have a high sum insured. The cost of teak is exorbitant.
- You need to include all the other hard items around the property, boundary walls, paved driveways, paths and patios, as well as fences, and the swimming pool.
- Finally, don’t forget the government – all these figures must include VAT. Some major insurers have calculation tables on their websites to guide you through this process. You do not insure for market value, you do not insure for municipal valuation, you do not insure for
what the bank thinks your home is worth in terms of a loan or bond. You insure for what it would cost to rebuild at today’s rates. This comes up at least twice a year and I often see homes being way under-insured. Nobody wants to get half a house back. As the insurance industry ombudsman has ruled, the only person responsible for ensuring you are insured for the correct amount is you – not your insurer, not your broker and not your bank.
Q
: Hendrine is looking for advice on timber treatment. In the article found on the website below you gave advice on how to remove varnish from abalau
deck:
https://www.iol.co.za/lifestyle/ home-garden/home/tips-for-
treatinga
-balau
-deck-1614425
Is it advisable to use a high-pressure cleaner to remove the dried flakes?
A
: You are really delving back into my old articles, but the advice does not change. No water-jetting on timber, please. As I say in the article you read: dry sand, lots of elbow grease and sandpaper, after a long and hard brushing session with a wire brush and steel wool.
*Handy Mac, aka Don MacAlister, is our expert on household DIY issues. If you have a question for him, please send it to [email protected] or SMS only to 082 446 3859. Find Don on FB: