Insurance for the Young Person

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Insurance for the Young Person


Why insurance?

‘I don’t believe in insurance!’ This is an interesting statement and unfortunately one I’ve often heard people say. While it’s easy to argue that it tops the charts when it comes to grudge purchases, it is unfortunately a luxury very few people can afford to go without.

Opting not to insure simply means that you are prepared to assume a risk in your personal capacity and that you’re happy to take the associated financial ‘knock on the chin’. It means that you choose not to mitigate a specific risk. The alternative, namely to insure, is simply a form of financial protection in the event of an unforeseen incident causing you potential financial loss.

Important to know

There are a few principles you need to understand when it comes to insurance.

Average* - The ‘average’ principle means that you have to insure for the correct value or the insurer will only pay a percentage of the loss. This applies to cover for household contents as well as for property. Therefore, it is best to take inventory of the assets you wish to insure and to make sure that you are covered for the correct amount.

Insurability* - Insurance is there to compensate losses which can be defined, are sudden, accidental or unforeseen and which can be measured. This means that any damage that accrues due to wear and tear or lack of maintenance, will not be covered.

Insured* - This term refers to the person named in the contract and any person residing with him or her. If you are no longer staying with your parents, you need to take out your own insurance or make sure that your address is listed in your parents’ insurance contract. Also make sure that you are named as co-insured in the contract.


  • Most of the time it is cheaper if you insure your motor vehicle as part of your comprehensive insurance policy. Insurance for household contents, unspecified all-risk cover and personal accident cover is a more affordable type of cover. You can then add your motor vehicle to this policy.
  • If you insure valuable items like jewellery (wedding/engagement ring), you will need a valuation certificate. Make sure that you renew the certificate every five years.
  • Cell phone insurance is expensive. If you have a back-up phone, rather don’t insure at all. Make sure that you don’t insure your cell phone twice both in terms of your service provider contract and your personal insurance.
  • If you insure your household contents and you have an expensive television and sound system, note that insurance policies have a maximum amount per single item that they will pay, ie. If contents is worth R100 000 they can restrict payment to R25 000-R30 000 per single item.
  • IPods and cameras need to be insured under all risk specified items if you want cover out of the house. This is expensive. Check your adorability.


Take inventory

It will help you to insure your content for the correct value.
Remember to adjust your value when you buy expensive items.

Know your excess

Make sure you compare excesses when you compare quotes.


Check all the extra add-on benefits when you compare quotes.

Keep your slips

Keep slips when you buy anything. You need proof
of ownership in the event of a claim.

Compensation methods

Make sure you know what compensation method the insurance
uses in the invent of a claim. They can choose to replace the item
or give you vouchers to use a specific provider.


19 Jul 2018