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AIG South Africa fills gap in homeowner risk

04 August 2009 AIG

• First of its kind in SA
• Growing demand from SA homeowners

Due to the increasing popularity of the product in AIG’s other markets worldwide, AIG South Africa has introduced a new offering that pays policyholders’ mortgages for up to 6 months in the event of a disaster that leaves them out of home.

AIG SA recently announced it will re-brand to Chartis in October as part of a global restructuring under which AIG's insurance businesses are being transferred into a newly-formed, profitable entity that is separate from AIG Inc, and isolated from its challenges.

Wally Gast, Personal Lines Manager at AIG South Africa, said that the new Disaster Mortgage product was quite different from traditional homeowners insurance in that it provides policyholders with mortgage reimbursement in the event that their homes become uninhabitable for more than 48 hours up to a maximum period of 6 months.

“Most people have buildings and household insurance but what happens if they have to move out of home because of fire, flood or other disaster that makes their homes unliveable?
“It can be very costly to find alternate accommodation for a whole family and whilst their insurance may cover these costs, they are obliged to continue paying their mortgage even though they are not occupying the house.”

Cash payments in the form of mortgage reimbursements are made to policyholders as soon as they are not able to live in their homes for longer than 48 hours. Traditional household insurance only covers the replacement cost of insured household goods while buildings insurance typically covers the cost of the repairs to the structure.

Gast notes that Disaster Mortgage policies are increasingly popular with AIG’s clients around the world as they fill a gap in traditional insurance cover and also because of the sharp rise in natural disasters.

“There is no doubt natural disasters are on the rise the world over. In South Africa we have had unprecedented levels of floods of late, as well as fires such as those in Cape Town earlier this year which forced people out of their homes for months while repairs were undertaken.
“Disaster Mortgage will help homeowners reduce their risk even further.”

Disaster Mortgage premiums are based on the limit selected by the client but the coverage limit may not exceed the mortgage amount. The product is part of AIG South Africa’s new Plus Products insurance offering which has a special product for each life stage and the needs that go with it.

The Plus Products offering ranges from ID and credit card protection, added travel coverage, product protection for purchased items, disaster protection, lifestyle protection and enhanced auto protection.

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