Smart Tip: Grid failure, power surge, and fridge and freezer contents

Smart Tip: Grid failure, power surge, and fridge and freezer contents

Smart Tip: Grid failure, power surge, and fridge and freezer contents

Following the persistent loadshedding over the past few months, there have been questions raised around the cover that we provide to your clients in cases where their electronics or appliances are damaged due to a resultant power surge, or where the contents of their fridge or freezer has spoiled. This Smart Tip will aim to provide clarity on these scenarios and the cover we provide

Are your clients covered for loadshedding?
It is important to distinguish between loadshedding (the scheduled switching on and off of municipal power supply) and a power surge (an unexpected spike in the voltage supplied to an electrical circuit).
Loadshedding itself will not cause any damage to your clients’ items and so cannot be classified or covered as an insurance risk.
They will instead be able to claim for damages due to a resultant power surge as outlined below.

Do we provide cover to your clients for damage due to power surge?
When power is restored to the grid, there can often be an unexpected spike in the voltage that is supplied to the electrical circuit. This is called a power surge and can cause significant damage to electronic devices and appliances and, in extreme cases, can even cause a household fire.

Your clients automatically have embedded cover for power surge under the buildings and household contents sections of their plan. Buildings cover for power surge is up to the sum insured, with cover for household contents up to the sum insured on the Purple Plan and limited on Essential and Classic. They also have the option of buying up additional accidental and power surge damage cover under the
household contents section, which will provide them with more comprehensive cover for an additional

When submitting a power surge claim, clients should not discard or replace the damaged item – they
will be referred to one of our partners who will assess it. Please note that we will only accept
assessment reports submitted by one of our approved partners and no payments will be made on claims
where repairs are done without prior approval.

Will clients be covered if there is a grid failure?
Our Plan Guide notes that cover for loss, damage or consequential loss caused by a blackout or scheduled lack of power supply for more than 12 consecutive hours, is excluded. It is important, however, to be clear that we are referring to a partial or full grid failure where the electricity supplier is unable to provide power at all. This is not the same as regular loadshedding, which is instead the
deliberate and scheduled management of the current grid capacity.

How are clients covered for their fridge and freezer contents?
We cover your clients up to the amount stated in the BLA (Benefit Limit Annexure) for the value of their fridge and freezer contents where this is accidentally spoiled due to a change in temperature. It is extremely unlikely that a fridge or freezer in good working condition will have a significant enough internal temperature change to cause the spoiling of it’s contents within the relatively short loadshedding periods of a few hours at a time. Such spoilage would then likely be due to another reason – for example, a power surge or power trip event that happens while the client is away from home.

However, clients will not have cover if there is a grid failure as outlined above.

What about the clause stating that the clients’ fridge and freezer contents will not be covered if there is failure by the electricity supplier to provide them with power for any reason?
In this case, it is again important to clearly define what we mean by failure of the supplier by use of some examples:

  • If the municipality cuts off the power for any reason (including grid failure) or if they were to load shed more than necessary to meet a given quota, this would constitute a failure of the supplier to provide power and the client would not have cover.
  • If, however, the client suffers an outage following cable theft or if a substation blows, preventing the provider from supplying the power, this is not considered a failure but rather an accidental event and so the client would have cover. We pride ourselves on continuing to provide all our clients with innovative, fair and comprehensive insurance cover, despite what is currently a very challenging environment for the market. It is important to highlight that we always expect clients to take due care in minimising any losses suffered as part of their responsibility within the insurance contract.

Information sourced from Discovery Insure

Please note that any information in our posts, documents, infographics, emails etc is general information and should not be considered as providing financial advice. We therefore disclaim all liability and responsibility arising from any reliance placed on such information by any reader, client or visitor to our website. Though we make every effort to ensure the accuracy of the information provided we accept no liability for any inaccuracies.