Why Home Insurance Claims Get Rejected: What to Check Before Buying Property in South Africa

The Harsh Reality of Insurance Claim Rejections

South African insurance companies reject thousands of home insurance claims annually. The most frustrating part? Many homeowners bought properties without knowing these issues existed, only discovering the problems when it's too late to claim.

According to industry data, the most common reasons for claim rejections include:

• Pre-existing damage or defects
• Lack of proper maintenance
• Gradual deterioration
• Non-compliance with building codes
• Excluded perils not covered by policy

Let's explore each category and what you should check during property viewings to avoid buying a home with these issues.

1. Pre-Existing Damage: The Silent Policy Killer

Why claims get rejected: Insurance covers sudden, unforeseen events - not existing problems that worsen over time.

What to check during property viewings:

• Foundation and wall cracks: Document ALL cracks with photos, even hairline ones. Get them assessed before purchase.
• Roof condition: Missing tiles, sagging sections, or rust spots are pre-existing that will cause future leaks insurance won't cover
• Damp patches: Any visible moisture, staining, or musty smells indicate existing water issues
• Window and door seals: Broken seals or damaged frames allow water entry that insurance may not cover

2. Lack of Maintenance: The R78,000 Geyser Lesson

Why claims get rejected: Homeowners are expected to maintain their properties. Damage from unmaintained systems isn't covered.

Critical maintenance items to verify during viewing:

Geysers (Most Common Rejected Claims)

• Ask: "How old is the geyser? When was it last serviced?"
• Red flags: Geyser over 10 years old, no service records, visible rust, no drip tray
• Insurance requirement: Regular servicing every 2-3 years, replacement at 12-15 years
• Action: Get geyser age in writing; budget for replacement if old

Roofs

• Ask: "When was the roof last inspected and repaired?"
• Red flags: Missing or broken tiles, visible sagging, no maintenance history
• Insurance requirement: Roofs should be inspected every 2-3 years
• Action: Photograph roof condition; request last inspection report

Plumbing

• Test: Run all taps, flush toilets, check under sinks for leaks
• Red flags: Slow drains, low pressure, visible pipe corrosion, dripping taps
• Action: Note any issues; ask about plumbing age and past repairs

3. Gradual Deterioration: Not an Insurable Event

Why claims get rejected: Insurance covers sudden accidents, not slow decay from age or wear.

Commonly rejected "gradual deterioration" claims:

• Pipe bursts from old, corroded plumbing (not sudden blockage)
• Roof leaks from aged, deteriorated materials (not storm damage)
• Wall cracks from ongoing foundation movement (not sudden subsidence)
• Damp from long-term waterproofing failure (not flood)
• Electrical faults from aged wiring (not power surge)

4. Non-Compliant or Illegal Structures

Why claims get rejected: Insurance doesn't cover structures built without proper approvals or that violate building codes.

Critical questions to ask during viewing:

• "Do you have approved building plans for any alterations or extensions?"
• "Was the boundary wall built with municipal approval?"
• "Are there compliance certificates for all building work?"
• "Have any structures been built without plans?"

Common non-compliant structures insurers won't cover:

• Boundary walls without proper foundations or drainage
• Enclosed patios without building approval
• Room additions without plans
• Pool installations without compliance certificates
• Wendy houses on permanent foundations

5. Specific Exclusions: Read Your Policy Fine Print

Why claims get rejected: Standard home insurance excludes certain perils unless specifically added.

Commonly excluded (check during property viewing):

Flood Damage

• Standard exclusion: Most policies don't cover flooding without add-on
• Check during viewing: Is property in flood-prone area? Near river or low-lying?
• Action: Research flood history; budget for flood insurance add-on

Subsidence and Earth Movement

• Often excluded: Unless specifically covered
• Check during viewing: Are there cracks indicating movement? Sloping floors?
• Action: Get structural engineer assessment before purchase

Wear and Tear

• Never covered: Normal aging of building components
• Check during viewing: Age of all major systems (roof, geyser, plumbing, electrical)
• Action: Budget for replacements yourself

6. The Sectional Title Insurance Trap

Why claims get rejected: Confusion over body corporate vs personal insurance responsibility.

What body corporate insurance covers:

• Common areas (roofs, exterior walls, lobbies)
• Building structure
• Common property damage

What your personal insurance must cover:

• Interior of your unit
• Your contents and improvements
• Liability within your unit

How to Protect Yourself When Buying Property

Follow this checklist during property viewings to avoid buying homes with insurance issues:

Before Making an Offer

1. Document everything: Photograph all defects, cracks, damage, or wear
2. Ask about age: Get geyser, roof, plumbing, and electrical ages in writing
3. Request maintenance records: Geyser servicing, roof inspections, etc.
4. Verify compliance: Ask for building plan approvals for all alterations
5. Check body corporate insurance: For sectional title properties

During Due Diligence

1. Professional inspection: Hire inspector for properties with any concerns
2. Request insurance history: Ask seller about past claims filed
3. Contact insurer: Describe property condition; confirm coverage before purchase
4. Get compliance certificates: Electrical, plumbing, building work

After Purchase

1. Immediate maintenance: Service geyser, inspect roof, fix visible issues
2. Document property condition: Photo/video everything when you move in
3. Review policy carefully: Understand exclusions and requirements
4. Schedule regular maintenance: Keep records for potential claims