MODULE 6
HOLIDAY HOME
Yes. It is a house.
And this is insurance.
Simple, understandable, no-mystery insurance.
96
CASE STUDY
SECTION HOLIDAY HOME
MODULE INTRODUCTION
Mr. X also owns a house, which he visits for breakaway weekends. This house is located on a small farm in the mountains and
is isolated from any other houses, farms, etc. Currently, there is no farming activity on the farm. It is being used for recreational
purposes exclusively. He would also like to insure the house and its contents since it was recently burgled. It was the second
burglary in eight months. In both instances the windows of the bedroom were broken and the burglar bars were sawn off. Mr.
X would like basic cover for only the contents and building.
It will be expected from you to do an inspection/overview of the house and make the necessary notes on you observation. List
this on the schedule to be provided to you.
MODULE OBJECTIVE
The goal of this module is to evaluate your knowledge of the following aspects in terms of Section House Contents and Section
Buildings of the Santam’s personal policy with regard to this specific risk:
•
•
Risk evaluation with the necessary recommendations; and
The answering of general questions with regard to policy cover and underwriting.
TASK 1
Study photographs 1 to 5 on the CD along with the site layouts and list your observations and recommendations. (Your
observations should be objective and stated in such a way that the assessor can determine during evaluation whether you are
able to identify certain aspects with regard to the risk and could make the necessary recommendations.)
SITE LAYOUT
LIVING ROOM
BATHROOM
LEAN-TO
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Course code: ASSESS-SPP2
97
Observations
Recommendations
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Course code: ASSESS-SPP2
98
TASK 2
Answer the following questions regardless of your recommendation.
Motivate your answers with the relevant facts throughout to qualify for the maximum allocation of marks as indicated per
question.
QUESTION 1
Mr. X would like to know if he could jointly insure the construction and contents, since the sums insured with regard to this is
low. Motivate your answer.
2
QUESTION 2
Since the house has a timber construction, will his premium be higher?
1
QUESTION 3
Will Santam provide cover for theft (with or without visible and forcible means) for this house? Motivate your answer by giving
at least three reasons.
4
Copyright ©Santam (Pty) Ltd. 2011
Course code: ASSESS-SPP2
99
QUESTION 4
Mr. X would like to know if he should take out additional cover for Personal Legal Liability for the holiday home. He frequently
receives guests from the area who stay there for the weekend. He is worried that should something happen to them, he
would be held responsible.
2
QUESTION 5
Mr. X would like to know whether he would be able to claim in terms of his policy for the guests’ effects, which were damaged
in a fire. Motivate your answer.
2
QUESTION 6
This holiday home has never been insured before. Even though his holiday home had been burgled before, will the
no-claim bonus of his other house also apply to the holiday home? The reason for this is because he never claimed for the
incidents.
2
Copyright ©Santam (Pty) Ltd. 2011
Course code: ASSESS-SPP2
100
QUESTION 7
Mr. X would like to know should he lease the house out permanently, will he still enjoy cover in terms of Santam’s personal
policy with regard to:
•
•
Construction
Contents
2
QUESTION 8
Mr. X is considering to establish a closed corporation and to market the house as a holiday home. The area where the house is
situated receives foreign visitors frequently and this is an ideal opportunity to add to his income. If he does this, will the house
still be insurable in terms of the Santam’s personal policy. If so, which measures will apply?
1
TOTAL
Copyright ©Santam (Pty) Ltd. 2011
16
Course code: ASSESS-SPP2
101
SUMMARY
Following on the information available to you with regard to this section:
•
How will you classify the insured and risk? Describe it in your own words.
•
Categorise the insured and risk by making a cross in one of the following blocks.
Low frequency/high risk
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Low risk/high frequency
No potential risk
Course code: ASSESS-SPP2