Here’s when your insurer won’t cover you for landslides
Last year’s landslide in Mossel Bay, in which almost 30 families in Seemeeuvlug and Tuscan Village have been told to evacuate their houses after land foundations shifted, raises the issue about whether this type of damage is typically covered by insurance policies.
Marike van Niekerk, manager for Legal and Compliance at MUA Insurance Acceptances says most insurance policies provide limited or no cover for subsidence, landslip or ground heave unless it is specifically requested beforehand and the homeowner pays an additional premium for that cover. “Homeowners might not have this cover in place as part of their policy and it is therefore vital that they check with their insurance broker what their policy states.”
Obviously, not all homes will be prone to these types of damage, but reports on the incident in Mossel Bay say the land on which the developments were built were previously used as a quarry some 17 years ago. Mossel Bay Municipality spokesperson, Harry Hill, was quoted as saying that results of a study in May showed the area was not suitable for residential accommodation.
When buying a house, new homeowners should ascertain whether the area is prone to landslips, subsidence or ground heave. If an area is prone to these elements the property should generally have reinforced structures and additional measures implemented based on a geotechnical report, says van Niekerk.
Tuscan Village resident, Andries Coetzee, was quoted in The Cape Times as saying that last year they first noticed cracks in the walls which were subsequently repaired. But the situation worsened and their insurance company said it was beyond repair. “The houses will be demolished and nothing can be done about that,” Coetzee was quoted as saying. “Some of the people are still living in the area, but our section was marked as a red zone.”
The cover for subsidence, landslip and ground heave need to be bought prior to the loss. Van Niekerk says that this will normally be at an additional cost and after the insurer had the opportunity to assess the risk prior to providing the cover.
“It is standard procedure when an insured person wants cover for subsidence, landslip or ground heave, that the insurer would assess the risk based on any signs of building damage like, whether neighbouring properties have a history of similar damages, if property is built on ground level or if foundations have been reinforced,” says van Niekerk. “A geotechnical engineer will be able to provide reassurance of the information should these types of damage signs be present.”
She says that there are instances where the claim might be rejected due to the damage not being determined as sudden or unforeseen, but might have been caused over a period of time.
“Settlement, the movement of a site as a result of loading placed on it by a building, is excluded from subsidence cover in general and the insured will not enjoy cover if it is found that the cause of the damage is due to settlement,” says van Niekerk. “There are always certain exclusions connected to such cover and this must be kept in mind as this cover is not all-incumbent for any such event, for example, any damage in existence prior to the insurance cover, faulty materials being used or poor workmanship. The proximate cause of the damage will always be established by engineers before the insurer will accept or reject liability of such a claim.”