Page 35 - Bay Union - Prestige Policy Wording
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Paying out after a claim
How much we pay
We pay out based on the replacement cost of the part of your building that is damaged.
You always pay the  rst amount, or excess
You will always have to pay the  rst part of any claim settlement. This is known as the excess, and is listed in your schedule.
Bank may be paid out before you
The  nancial institution  nancing your home always has  rst claim on any payout to you, if this is the only way to settle any outstanding debt you still owe them.
This means that if you are  nancing your home with a bank or authorised credit provider, be aware of the fact that they are entitled to use your insurance payout to settle any money that you still owe them.
What if you are under-insured?
If you have insured your home for less than its actual value – i.e. you are under-insured – then you will have to bear a proportion of any loss in the event of a claim. In calculating this, we will use the principle of average.
If your claim is for a new wall that costs R10 000 to replace, we will pay you R10 000 so that you can have a new one built – even if the damaged wall is old and worth a lot less.
If you successfully claim R20 000 for repairs to your swimming pool, and the excess for that claim is R1 000, your net payout from us will be R19 000.
Your building is insured with us for R200 000, but the cost to replace it is R400 000.
This means you are under-insured by half (or 50%). Put another way, you are only ever insured for half of any claim you make. So if your building is damaged in a storm and it cost R50 000 to repair, we can pay out only half of R50 000 – or R25 000.
Bay Union - Prestige Policy Wording - 20 June 2012 32

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