22 August 2019Elite Risk Acceptances

Christelle Colman, Managing Director of Elite Risk Acceptances

Tips from an industry expert

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”. The truth is, there are a number of other more nuanced areas of insurance that exist, which tend to be the areas that people are far less familiar with. 

To shed some light on these lesser-known, yet important types of insurance, Christelle Colman, Managing Director of Elite Risk Acceptances, recently spoke to Wealthwoke about the importance of speciality insurance policies such as personal liability, identity theft, and travel insurance.

• 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,” says Colman, who goes on to describe a recent case that she dealt with.

“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.”

Colman explains that, 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 like these to court, and considering the costly nature of legal fees, a personal liability policy is becoming ever more important.”

• Identity theft
With cybercrime also becoming an increasing risk, Colman says that 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.”

She points out that the majority of costs and issues are in relation to reinstating a person’s identity after the fact. “Oftentimes, 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.”

• Travel insurance
Travel insurance is another type of speciality insurance that Colman recommends, adding that it is more about covering medical expenses than it is about recovering lost or stolen items, albeit is also important, while abroad. “Medical aids 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 medical costs incurred.

“Considering the unfavourable exchange rate of the rand at the moment, this can end up being extremely costly,” she adds.

On the other hand, Colman highlights the case of people who travel to destinations where the medical treatment is not on 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, Colman says that 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. For example, in line with the global growth of cryptocurrencies, Elite also offers cover for the theft of cryptocurrency in the e-wallet as a result of hacking,” she concludes.