Electronic equipment insurance covers the cost to repair or replace specified electronic equipment following an incident (fire, storm, theft, etc.). You can also choose to insure the cost for the reinstatement of data and programmes, as well as additional costs to run your business after the loss/damage of your electronic equipment.
Any business that uses electronic equipment in its operations should be protected by Electronic Equipment insurance. You probably need Electronic Equipment insurance if you have any of the following items, keep in mind that fixed items are usually insured under Electronic Equipment where is portable items would be insured under Portable Possessions:
Your insurance policy will have its own specific list of insured events and exclusions. It is best to check with your insurer or the policy wording to confirm the details of your Electronic Equipment insurance policy.
Some commonly covered and not covered items include:
This is typically the cost of replacing your item. The insurer aims to put you in the same position you were in before the loss.
Items bought in the last 7 years
If you bought the item recently you can use the invoice value, or the current price of the item (e.g. on Takealot) if you purchased it a while ago. If you are not able to find the current price, then speaking to the manufacturer or a professional is usually the best option.
Items bought more than 7 years ago
Items that are older than 7 years will be covered at market value (the price of similar used property). Second-hand marketplaces (e.g. Gumtree) and second-hand stores can give you a good indication of what the value is.
Where no similar item is available, market value can be calculated by taking the new replacement value of the nearest equivalent item, and deducting 60% of the new equivalent item. For example, if you bought a laptop 7 years ago for R20 000 and a new similar laptop costs R25 000 now, then you should insure your item for R25 000 x 40% = R10 000.
Theft claims
Increased cost of working
Reinstatement of data/programmes
Flood claims
Medical equipment
Let’s say you have a laptop you want to insure. The value you need to insure this item for is the current replacement value of the item.
Over-insuring my item
Say you insure your laptop for R50 000 but the true value is actually R25 000. You will pay higher premiums than necessary. When you claim for your laptop, you will only be paid out R25 000 because that is the current cost of replacing your laptop.
Under-insuring my item
Now let’s say that you insure your laptop for R20 000 but the true value is R25 000. You will pay lower premiums than you would have if you insured your item for R25 000, but when you claim for your laptop, you will only get R20 000! This leaves you underinsured and you will have to pay the additional R5 000 to purchase a new laptop.
Generally, the higher the level of risk that your business is exposed to, the higher the cost of the premium.
Yes, your items are covered for power surge so long as the property was protected by the necessary surge arrestors.
Cover under the Electronic Equipment is only provided for the items that stay in the office at all times, if you are seeking cover for items which would leave the office at any point of time other than for repairs or moving purposes, then you would need to look at the Possessions sections which is more appropriate for items that need to leave the office.
Yes, you can cancel your policy with immediate effect at any time. Insurance company will have to give 30 days’ notice to clients if they wish to cancel from their side.
