When it comes to short-term insurance, most people know the basics of home and motor insurance, but this is just the tip of the “insurance iceberg”.
There are a number of other, more nuanced areas of insurance that tend to be the areas with which people are far less familiar.
Personal liability. In a nutshell, personal liability insurance is to cover your legal liability for accidental death, bodily injury or illness of another person, or for accidental loss of or damage to property belonging to another person.
A client recently had a significant claim for a visitor who fell off their newly-built home’s balcony, breaking their neck. As this visitor was a high-income-earner, they held the homeowner personally liable for not only medical expenses, but also their loss of income.
In this sense, personal liability cover means that the insurance company will defend the client against claims of this nature and pay out if the court makes a ruling that there needs to be a settlement. People are becoming increasingly willing to take matters such as these to court, and, considering the costly nature of legal fees, a personal liability policy is becoming more important.
Identity theft. With cybercrime also becoming an increasing risk, instances of identity theft are on the rise.
As the world changes with the advancements in technology, it’s vitally important to keep your identity safe and secure. Identity theft insurance essentially covers any financial loss or legal expenses incurred if another person or entity assumes your identity.
The majority of costs and issues are in relation to reinstating a person’s identity after the fact. Often, the major costs here are in relation to reinstating your credit card and other identity documents that may have been tampered with, along with sorting out the impact this may have had on your credit score with the credit bureaus.
Travel insurance. Travel insurance is another type of speciality insurance. It is more about covering medical expenses than it is about recovering lost or stolen items, albeit is also important, while abroad.
Medical schemes in South Africa often don’t extend to international travel insurance cover, so if you have a medical emergency while travelling, you will be personally liable for all the medical costs incurred.
Considering the unfavourable exchange rate of the rand at the moment, this can end up being extremely costly.
On the other hand, it is important in the case of people who travel to destinations where the medical treatment is not on a par with that of South Africa.
In this case, it is advisable to travel back to South Africa to get the right treatment, which a travel insurance policy would typically also cover.
While these three areas of specialised insurance may be the most widely applicable at this point, there are many more options out there that are becoming increasingly mainstream.
As the insurance industry continues to evolve, policy offerings are becoming increasingly tailored to the modern world.
Christelle Colman is the managing director of Elite Risk Acceptances.