How inflation affects insurance replacement cost

Building insurance cover is typically issued based on its replacement value. The replacement value of your property at the time of policy inception will unquestionably be affected by inflation during the period of cover. Inflation The costs of building materials, building services and other professional fees (such as architects and engineers) will increase over time. | Read More

Insurance implications of section extensions in sectional title complexes

It is quite common for owners in sectional title complexes to improve their sections by extending it, enclosing a balcony, adding a shade structure, extending a patio, or building a structure or swimming pool on the exclusive use area. Some estate agents will say anything Some estate agents will quickly assure potential buyers that such | Read More

Inner-city community schemes: The risks and responsibilities

One of the most popular forms of residential habitation in South Africa is undeniably a sectional title or community Scheme. Over recent years, this property sector has experienced heavy regulation in the form of the Community Schemes Ombud Service Act 2011 (CSOS) and the Sectional Titles Scheme Management Act 2011 (STSM) which came into force | Read More

Insurance responsibilities ahead of the AGM

While trustees have a fiduciary duty to comprehensively insure the scheme, managing agents often take care of insurance obligations on behalf of the body corporate. Schedule of Replacement Values (SRV) The most important responsibility is to prepare the SRV based on their most recent valuation plus escalations for inflation. Make sure that this matches the | Read More

When valuation measurements don’t add up

“Our recent valuation measurements do not quite add up – can this be right?” This is a question we are faced with quite regularly, especially now that insurance valuations have become compulsory for sectional title schemes. Most often, the square meters of buildings as shown on the valuers’ report differs slightly from that shown on | Read More