What is Fire Insurance, Why Fire InsuranceId is Important?

What is fire insurance, when is it covered?

Today, insurance is critical in everyone’s lives. You would primarily have heard about life, health, and motor vehicle insurance. However, today, we will give you some vital information regarding fire insurance. Under fire insurance, when the property of a policyholder suffers a loss from fire, then the insurance company compensates for that loss. 

Different companies selling fire insurance provide cover according to varying circumstances of fire. Many types of policies on fire insurance are available in India, including specific policies, comprehensive policies, floating policies, replacement policies, etc.

Fire insurance is quite useful. Let us tell you that fire insurance is a subdivision of property insurance. One unique thing about fire insurance is that it can be purchased by the property owner and the tenant. Fire insurance provides protection not only to the house but also to your business and offices and factories associated with it. House fire insurance Repays the loss caused by a fire.

It covers both burnt goods and property damage. Apart from that, in industrially-based cases, it also covers the machines that have caught fire and their maintenance.

What is covered by Fire Insurance?

  • – Damage caused by fire
  • – Things damaged due to water
  • – Loss caused due to throwing out goods due to fire
  • – Payment of wages of people engaged in extinguishing the fire”
  • – Loss caused due to explosion
  • – Loss caused due to electricity

Cover is not available in these circumstances.

  • – Loss caused in fire caused due to earthquake is not compensated.”.
  • – Loss due to attack, rebellion, war
  • – Moreover, underground fire losses are not compensated either.
  • – Theft during fire or loss due to theft after the fire is not covered.”
  • – The loss is caused knowingly by the person who is insured.

In the Indian market, insurance of Rs 7 lakh is sold for just Rs 11 a month. Apart from this, you can get insurance with a more extensive cover also while keeping in view your property and requirements.

Who Can Buy Fire Insurance?

You can apply for fire insurance if you possess one or more of the following –

 

  • Firm or organization
  • Shops or godown.
  • Medical clinics, hotels, lodging service
  • Building, furniture, or household items
  • Finance and research institutions, banks
  • Industrial or manufacturing firms.

How to Choose the Right Fire Insurance Coverage?

There are a few things to bear in mind when buying fire insurance for your business:

 

  1. Building and contents values: Full replacement value is what you want to adequately insure your building and the contents of your premises to be fully protected in case of a fire. 
  2. Type of business – Some types of companies may be required by law to have specific types of insurance fire coverage. Businesses that deal in flammable products, for example, may be liable to have product liability insurance in the event of a fire due to one of their products.
  3. Your location: In case your business will be located in an area where wildfires are common, then you should be covered against them, alongside standard fires.
  4. The Deductible: This will be the amount deducted from your due compensation if you make a claim. Assuming that there would be a higher deductible applied to you under your policy, then your premium will be lower. You just have to make sure to prepare for the deductible payment should there be an instance of encountering a fire incident. 
  5. Know the policy limits and buy enough insurance to be appropriately protected if your business encounters a severe fire event.

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