Soul Abraham – Chief Executive: Retail Insurance, Old Mutual Insure
Personal liability insurance can be a thorny topic, and even more so because it can be tricky to explain to your clients.
The reality is that anyone in South Africa that owns the property has a reasonable duty of care to provide to all visitors who enter their property. If a homeowner breaches their duty of care and is negligent towards a guest and the visitor is injured, he or she is entitled to sue for their injuries. This is when personal liability insurance kicks in.
What is a personal liability cover? How does this cover protect consumers?
Personal liability insurance is to cover your client’s legal liability for accidental death, bodily injury, or illness of another person, or for accidental loss or damage to property belonging to another person. This insurance cover is typically entrenched in homeowners or household content insurance, or a separate class on a personal insurance policy. As a rule, personal liability insurance cannot be purchased on a stand-alone basis.
Many comprehensive household insurance policies have personal liability cover within them. Personal liability cover provides for the legal fees and damages claimed against your client (in their personal capacity) because of something that happened on their residential property – for example a postman bitten by his or her dog; personal liability insurance provides cover if they are sued.
Complex products
The most common form of personal liability insurance is that for which doesn’t need to be paid separately. Typically, the liability coverage provided on a standard policy can be complicated.
For example, liability arising out of home businesses can be complex and in many circumstances, these risks will be excluded. It can not only impact liability but also personal property as well. Often coverage can be added at a nominal extra premium charge depending on the type of business being operated.
Typical exclusions under a Personal Liability policy relate to liability for motor vehicles that require registration and licensing to operate on roads. Therefore, cars require motor insurance cover and are not insured under home contents policies.
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Claims procedure
It is crucial to remind clients that they must notify you (their broker) as soon as possible after an event in which they were involved if it may give rise to a claim. If anything should occur, the client should keep a record of what happened as well as any witness statements. It is only when the client receives any documentation from the third party, they must send it to the Insurer immediately. They must not try and negotiate with the third party directly as this could prejudice their claim.
Top three tips to give your clients
The golden rule is to remind your client never to admit liability as this may very well compromise the success of their claim, as it is expressly prohibited.
- Advise them to seek medical attention immediately. The well-being of their guests should always be their priority. Take all necessary steps to ensure no further aggravation of the incident.
- Evidence is in the detail. Take pictures. We live in an age of digital ease – always take photographs to substantiate the claim if possible.
- Gather and preserve other relevant information or evidence. Get the names and contact information of any person who may have witnessed the incident or who can describe the conditions of the floor, lighting, security, or any other conditions at the time of the incident that may have contributed to the injury.