Low Cost Housing insurance has arrived in South Africa, giving families supported by the Government Subsidy Housing Scheme vital protection against unforeseen financial circumstances…
The Government Subsidy Housing Scheme has changed the lives of millions of South African families with the provision of free housing – commonly known as low cost homes – to qualifying citizens. Government funded homes give those who would otherwise never be able to afford the cost of housing the chance to enjoy the benefits of property ownership. But while low cost houses have undoubtedly been very positive for local society, South African communities are still rife with stories about families who experience crippling financial strain after receiving their property.
‘When beneficiaries of low-cost homes suddenly come across loss or damage to their properties, they face a heavy financial burden,’ Bangi Makopo, Co-Founder and Director at Social Housing Initiative Cover (S.H.I.C), a pioneering low-cost housing insurance company. ‘Most low-cost home families don’t have access to spare money, so if something goes wrong with their new house, they can’t afford to fix it. And if you don’t maintain a property more things tend to go wrong, and you end up in a negative cycle you can’t escape from.’
S.H.I.C offers affordable low-cost housing protection against this devastating scenario. For only R100 per month, low-cost homeowners can now make sure that if they experience theft, fire, material building damage or death, they will be able to pay the cost of repairs and burial.
The issue of low-quality buildings is widely recognised across South Africa. For example, early in 2019 Human Settlements Minister, Nomaindia Mfeketo, stated that government had spent R1.1 billion over the previous five years to repair badly built low-cost Houses. Worryingly, this figure does not include costs from three key provinces: Gauteng, Mpumalanga and the Northern Cape.
The S.H.I.C offering is therefore a huge development for low-cost homeowners and their families – especially since in 2019 many low-cost houses continue to be built at a low structural standard. ‘There are still a lot of reports from low cost home owners about poor quality, with specific mentions of weak walls and roofs,’ explains Makopo. ‘This is very unfortunate and can undermine the whole principal behind government subsidised housing. When a building is structurally weak to start with, it is vulnerable to natural forces like rain and wind. The weakness and vulnerability grow a hundred times when owners can’t afford to repair cracks, leaks and other kinds of damage.’
At R100 per month the S.H.I.C insurance product offering is affordable for most low-cost homeowners, and gives protection against core property damage, excluding household contents and renovations made to the house after it has been handed over to the owner. It also includes a basic family funeral cover. Policy holders also have the option to take up additional, affordable cover for household contents, as well as a funeral plan.
‘We’ve worked very hard to develop this product for South African communities,’ says Makopo. ‘It services families that meet government’s criteria for social housing, as well as anyone else with a home valued under R150 000. The cost of the premium is as low as we could possibly make it. This has been a big point of focus for us, along with making sure the process of getting cover is simple, and fast.’ Interested families can contact S.H.I.C via its social media pages, but the company puts most of its operational energy into servicing new and existing clients via a simple phone call.
The process is as easy as calling 010 900 1346. A friendly consultant then guides homeowners through the information they need to supply and sends them a quotation that meets their needs. After that, the policy is activated.
‘The response since we launched in July this year has been incredible, right across the country,’ concludes Makopo. ‘This is clearly an urgently needed product, because it protects our most vulnerable families against the very real risk of a financial nightmare. Anyone worried about this happening to them should call us immediately.’
About S.H.I.C Low Cost Housing Insurance Cover
Social Housing Initiative Company (S.H.I.C) offers affordable, low-cost housing insurance to South Africans who qualify for government subsidised housing. S.H.I.C was developed by Kunene Makopo Risk Solutions, in partnership with Afribiz Invest, and is underwritten by the Constantia Insurance Company.
Applicants for S.H.I.C must own a property with a market value of under R150 000, and / or meet South Africa’s National Housing Subsidy Scheme criteria, including:
They must be South African citizens.
They must be are over 21 years old, and mentally competent to sign a government subsidy housing contract.
They can be married or living with a partner, or single and supporting dependants. Single military veterans or aged people without dependants also qualify.
Applicants must earn less than R3,500 per month, per household. If two family members both earn salaries and their combined earnings amount to more than R3,500 per month, they will not qualify.
Applicants must be first-time government housing subsidy recipients.
They must also be first-time homeowners.