No claim if you are to blame, says ombudsman

The latest report by the ombudsman for short-term insurance highlights the importance of reading your insurance policy document and complying with the terms of the policy.

No claim if you are to blame, says ombudsman…

The latest report by the ombudsman for short-term insurance highlights the importance of reading your insurance policy document and complying with the terms of the policy. 

By Laura du Preez

The Star– Personal Finance, April 24, 2004.

Short-term insurers insist that you, the policyholder, implement various security measures to safeguard your possessions from crime, and many policyholders who complained to the ombudsman for short-term insurance last year did not have the right security measures in place.

Your cover and your premiums are based on certain security measures being in place. If you suffer a loss and those measures are not in place, your claim is likely to be repudiated (rejected) and the ombudsman will be unable to help you.

In his annual report for 2003, Helm van Zijl, the ombudsman, says the biggest source of complaints received by his office – 64 percent – related to vehicle insurance, and the second biggest source of complaints – 19 percent – related to household contents cover.

The reason there were so many disputes about these two types of cover, Van Zijl says, is the high crime rate and the numerous security measures, such as activated burglar alarms in your home or a gear lock or immobiliser in your car, that insurers now expect you to have in place.

“It is always amazing to me the extent to which insureds (policyholders) do not read their policies and fail to comply with the security requirements,”Van Zijl says.

In his report, he cites a number of cases involving claims that were repudiated because of problems relating to security requirements. One such case involved a man who lived in a security complex and had insured his household contents. He was paying a discounted premium because his security complex had a 24-hour guard.

However the complex decided to do away with the guard and the man did not inform his insurance company of this. The man’s house was burgled while he was out one night.

His insurer paid out for his laptop computer, which was insured under his all risks policy, but refused to pay out the balance of his claim under the household risk part of his policy, because he had not informed the insurer that his risk had been dramatically altered.

Van Zijl said he was unable to assist the man, because it is an integral principle of insurance that the insurer be informed of changes in risk during the insurance period.

For a similar reason, the ombudsman was unable to help a woman who complained about her claim being repudiated after she was hijacked and her car was stolen.

The woman had moved from Pretoria to Kempton Park five months before the incident, but she had not informed her insurer that she had moved. The move changed her risk profile, because Kempton Park is known to be a crime hot-spot.

Insurers base your premiums on a number of risk factors, including where you live, your age, your claims history and so on.

The woman should have been paying higher premiums to insure her vehicle at her new address because of the increased risk. But she was only paying 75 percent of the correct premium because she had not informed the insurer of her move.


Another case brought before the ombudsman holds and important lesson for anyone who renovates their home.

A man took out a household contents policy which stated that all external doors had to be fitted with security gates. The man did have security gates on all the external doors in his home until he renovated his living room. He removed the security gate and the existing door and replaced them with a sliding door. Two days later, thieves broke into his home by forcing open the sliding door with a crowbar.

The insurer repudiated the man’s claim for household goods stolen, on the grounds that he did not have a security gate on the sliding door.

This does not mean you cannot make alterations to your home, but, Hendrik Viljoen, an assistant to the ombudsman, says that when you do alterations your risk increases because you have more people on your property who can compromise the security of your home. For this reason, you should inform your insurer when you plan to do alterations.

Once you have completed your renovations, if you have altered your security measures – for example, by removing a security gate from a door that had one, or removing an alarm system – you should notify your insurer of the change, Viljoen says.

In this case, the man had not informed his insurer that he had removed the security gate. The ombudsman agreed that the insurer had a right to repudiate the man’s claim.

The lesson to be learnt from all these cases is that you must read your policy document carefully and comply with all security requirements. If you do not, don’t expect to be paid out when you claim.


The ombudsman was able to help a number of policyholders. In at least one case, the insurer, rather than the insured, was wrong about the security requirements that should have been in place.

In this case, a woman’s home was burgled, and the insurer repudiated her claim on her household policy on the grounds that she did not have an activated burglar alarm.

However, the ombudsman found that the insurer had failed to state that she needed to have an alarm and to activate it whenever she left the house. The policy documentation only stated that she needed to have burglar bars on all opening windows, safety gates on all doors and safety pins in all sliding doors, which she had. As no mention was made of an alarm or that it needed to be activated, the insurer agreed to pay the claim.

In this case the insurer slipp0ed up. But Viljoen says most insurers do expect you to have an alarm that is linked to an armed response service and you are expected to activate it when you leave your home unoccupied. Check your policy document.

If you are required to comply with any security requirements, don’t ever drop your guard and nip out without putting on the alarm or leave your car briefly without putting in place the required security measures, such as a gear lock.


The ombudsman was unable to help a woman who, upon returning home one night, locked her car but did not put on the gear lock. She went inside to find her husband to open the garage for her and put the car in it. While she was talking to her husband, the car was stolen.

Her insurer repudiated her claim because she was required to have and use either a gear lock or an immobiliser on her car.

The ombudsman was unable to help her because her failure to use the gear lock was material to the case. It could have prevented the car from being stolen, Van Zijl says.

Another lesson to be learnt from the ombudsman’s report is that you must keep your vehicle in a roadworthy condition or you will not be covered if you have an accident.

In a case that came before the ombudsman, a man’s car was damaged after he swerved to avoid, but ultimately hit, a drunk pedestrian. However, the tread on both rear tyres on his car were below the legal limit.

Most vehicle insurance policies, including that of the man in this case, stipulate that your vehicle must be roadworthy. As the tyres were worn, the man’s car was not roadworthy and his claim was repudiated.

The ombudsman was unable to help him because the condition of the vehicle was material to the claim. Although the worn tyres were not the cause of the accident, the accident may have been avoided or the damage less severe if the tyres on the man’s car were not worn, Van Zijl says.

The ombudsman receives numerous complaints from drivers whose claims are repudiated because their vehicles have worn tyres.

Van Zijl says in his report that he is “surprised by the number of people who drive vehicles with tyres that do not have a proper tread”.


The ombudsman for short-term insurance is Helm van Zijl, a specialist in insurance law and litigation.

The purpose of his office is to resolve disputes between insurers and consumers in an independent, impartial, cost-effective, efficient, informal and fair way. The ombudsman’s task is to act as a mediator or informal arbitrator, and he does not represent either of the parties in the dispute.

The services of the ombudsman’s office are free to insured consumers, but you must complain to your insurance company first.

Only if you are unable to resolve the matter with the company, can you take the matter to the ombudsman.

The ombudsman’s decisions are binding on your insurance company, but you are not bound by the decision and can take a matter to court if you are not happy with the ombudsman’s decision.

Contact the ombudsman’s office:

PO Box 32334, Braamfontein, 2017

Share call number: 0860 726 890

Telephone: 011 726 8900

Fax: 011 726 5501


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