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Fire Insurance
Extensive asset protection against diverse threats like fire, theft, natural calamities, covering costs for repair, replacement, and reconstruction.
What is Fire & Burglary Insurance?
Fire & Burglary Insurance provides coverage for physical damage to your property. This
damage can occur in a variety of situations like:
Fire
Lightning
Explosions or Implosions
Aircraft Damage
Storm, Cyclone, Typhoon, Tempest, Hurricane,Tornado,Flood & Inundation
Riot, Strike and Malicious Damage
Leakage from Automatic Sprinkler Installations
Subsidence and Landslide including Rock slide
Bursting and/or overflowing of Water Tanks, Apparatus and Pipes
Missile Testing Operations
Impact Damage
Bush Fire
Features of Fire & Burglary Insurance
Coverage
Protects against physical damage to a building or structure from fire or theft.
Eligibility
Requires you to provide a detailed description of the property you want to insure and show proof that you have a legitimate interest in insuring it.
Direct Loss
Covers immediate damage caused by the fire including destruction of buildings, equipment, furniture, inventory, and other physical assets within the property.
Policy Duration
The policy term is typically one year, with annual renewal required.
Customizable
Coverage options may be customized to meet the specific needs of a business.
Who needs
Fire & Burglary Insurance?
Companies that own or rent assets in the form of office premises, stock,
machinery, cash, or other forms need comprehensive fire and burglary insurance
policies.In addition to covering the office, retail, or factory premises, this policy also
protects the contents inside the premises including electronic equipment like
laptops, computers, and phones.Fire & Burglary Insurance offers valuable coverage for businesses of all sizes
and industries.
A few common businesses that purchase fire insurance are :
Hotel Owners and Service Providers
Guard against the financial consequences of fire damage to your hospitality or service-based business.
Shop-keepers and God own Owners
Protect your retail or storage space from the potential financial impact of a fire.
Manufacturing and Industrial Units
Safeguard your operations, vehicles, and equipment with fire insurance.
Medical Clinics
Protect your medical facility, equipment, and patient records from fire damage.
Banks and Other Institutions
Ensure the protection of your financial assets and operations with fire insurance.
Why get Fire & Burglary Insurance?
Fire incidents are common causes of accidents in both residential and
commercial sectors in India. In 2021, India recorded 1.6 million fire accidents.Securing your assets is critical to your company's growth and stability.Fire & Burglary Insurance protects your property and its contents from a variety
of occurrences, including fire, theft, natural disasters, and man-made events
such as riots and terrorism.The Insurance offers tailored protection options to suit your business
requirements. You can select from specialized coverage choices such as
a. Sookshma Udyam Suraksha,
b. Laghu Udyam Suraksha, and
c. Standard Fire Special Perils (SFSP).
Benefits of a Fire Insurance Policy
Fire insurance offers protection against any harm or destruction from fire, fermentation, natural heating, or spontaneous combustion.
If a machine is damaged by fire, fire insurance covers the costs of repair or replacement.
Fire insurance also covers the cost of reconstruction of the property as per the sum insured in the policy.
Coverages
Fire insurance protects your business and its assets, shielding them from potential losses caused by fires or thefts. It covers a range of incidents related to fire and break- ins.
Loss to an adjacent property
This insurance provides coverage in the case of a fire or burglary that damages
or destroys the insured property while also causing damage to neighboring
property. It covers the costs of repairing or replacing the neighboring property.
Fire-related loss
Fire-related property losses to office buildings, machinery, furniture, and other
items inside the premises, can result in severe financial damage. Fire and
Burglary Insurance covers damage caused by fire, including the cost of repairing
or replacing the damaged property.
Bush Fire
Setting up a fire in the bush-grown area may damage the property. This incident
is covered under the fire policy. Please note the forest fire incident is not covered
directly. Additional payment is required to have coverage for forest fire incidents.
Natural Calamity
This policy provides coverage for any harm or destruction that may occur to the
insured property as a result of natural disasters like landslides, typhoons,
thunder, lightning and other similar calamities.
Damage due to aircraft
This policy provides coverage for any damage to property resulting from aircraft-
related incidents such as dropped articles, airborne devices, or any other causes.
Explosion/Implosion
Damage caused due to any explosion/implosion is covered under this policy.
Armed robbery
The loss of items like money, jewelry, gadgets, and other stolen personal
property may be covered by the policyholder's fire & burglary insurance in the
event of an armed robbery. It may also cover any property damage incurred as a
result of the heist, including broken or damaged windows, doors, or other
sections of the building.
Violent and forceful entry
In the event of a covered risk, such as burglary or theft with evidence of violent
and forced entrance, a fire and burglary insurance policy may cover both
property damage and the value of stolen objects. If the break-in renders the
property unusable, the insurance may pay for interim housing.
Business Interruption
The Fire Loss of Profit policy, also known as a Business Interruption (BI) policy,
provides coverage for businesses that experience disruptions in their operations.
This coverage includes compensation for the loss of income and the expenses
incurred due to a fire or other perils that cause interruptions to the business. By
paying a specified amount, the policy extends coverage for an extended period of
time.
Exclusions
While fire insurance policy offers a broad coverage for businesses, it's important to note that there are certain incidents that may not be included. Here are some:
Deliberate or purposeful harm
Any damage caused with intent or willful action is not covered under the policy.
This includes situations where someone intentionally causes harm to the insured
property.
Cold storage stock damage due to temperature fluctuations
If damage occurs to stocks stored in cold storage facilities as a result of
temperature changes, such as spoilage or deterioration, it may not be covered
directly by the insurance policy.
War, invasion, or war-like scenarios
Damages arising from acts of war, invasion, or war-like situations are typically
excluded from insurance coverage. This includes any losses caused directly or
indirectly by such events.
Pollution or contamination
Damages caused by pollution or contamination, such as environmental pollution
or toxic substances, may not be directly covered by the insurance policy.
However, upon some additional payment you can avail the coverage.
Lost or misplaced property
If the insured property goes missing or is misplaced, it may not be covered under
the policy. This applies to situations where the property cannot be located or
accounted for.
Claim preparation expenses
Any fees or expenses incurred while preparing or processing the insurance
claim, such as documentation or legal costs, are generally not covered by the
policy.
Consequential or indirect losses
Indirect or consequential losses, which occur as a result of the insured event but
are not directly caused by it, may not be covered by the insurance policy. This
can include financial losses or damages that arise as a consequence of the initial
incident.
Unoccupied building for more than 30days
If the insured building remains unoccupied for a period exceeding 30 days,
certain types of damages or losses may not be covered by the policy. This
typically applies to risks associated with unoccupied premises, such as increased
vulnerability to theft or vandalism.
Electrical machinery damage or electricity leakage
Damages resulting from electrical machinery malfunctions or leakage of
electricity may not be covered under the insurance policy. This includes
situations where the insured property or equipment suffers electrical-related
damages or losses.
About Fire Insurance
What type of property is covered by fire insurance?
Fire insurance typically covers damage or loss to property caused by fire, lightning,
explosions, and other similar perils. This can include a wide range of properties such as
homes, businesses, vehicles, and personal belongings. However, the exact coverage
and exclusions will depend on the specific policy and the insurance provider.
What are the major elements of fire insurance?
The major elements of fire insurance include:
a. Coverage
b. Premium
c. Deductible
d. Limits
e. Conditions
f. Exclusions
a. Coverage
b. Premium
c. Deductible
d. Limits
e. Conditions
f. Exclusions
Who is eligible for fire insurance?
In general, anyone who owns or has a financial interest in property that is at risk
of fire damage can be eligible for fire insurance. This includes homeowners,
renters, and businesses that own or lease property.
However, eligibility requirements and coverage options can vary depending on
the insurance provider and the type of property being insured.
Some insurance providers may have restrictions or limitations on coverage for
properties that are deemed to be at a higher risk of fire damage, such as
properties located in areas prone to wildfires.
What are the rules of fire insurance?
The rules of fire insurance can vary depending on the specific policy and the
insurance provider, but there are several common principles that apply to most
fire insurance policies. Some of these include:
a. Disclosure of Information
b. Insurable Interest
c. Limits of Coverage
d. Deductibles
e. Duty to Mitigate Loss
f. Premium Payments
g. Exclusions
a. Disclosure of Information
b. Insurable Interest
c. Limits of Coverage
d. Deductibles
e. Duty to Mitigate Loss
f. Premium Payments
g. Exclusions
How is the claim calculated in case of a fire or burglary incident?
In case of a fire or burglary, it is important for the insured to promptly inform their
insurance company in order to initiate the claims process. They should provide a
clear explanation of the damaged or stolen items and their corresponding value.
The insurance company will assess the damage and determine the appropriate
amount to be paid for the claim.
They may send an inspector to evaluate the property and review the insurance
policy to determine the coverage of items. Once they finish looking into
everything and approve the claim, the insurance company will pay out the
money, but they will also consider any deductibles or limits stated in the policy.
What is the first loss in fire & burglary insurance?
First loss in fire and burglary insurance refers to a type of insurance policy that
provides coverage for a specific amount, rather than for the full value of the
insured property. Under a first loss policy, the policyholder selects a specific
amount of coverage, known as the 'first loss limit.' This amount represents the
maximum amount that the insurance company will pay out in the event of a
covered loss, regardless of the actual value of the property. This type of policy is
typically used for properties that are at lower risk of damage or theft, or for
properties where it would be too expensive to insure for the full value.
What is the usual period of fire insurance?
The period of fire insurance refers to the duration of time for which the insurance
policy is in effect and provides coverage for the insured property. In most cases,
fire insurance policies are issued for a fixed term, such as one year, and the
policyholder is required to renew the policy at the end of the term in order to
maintain coverage.
What is the total loss in the fire insurance policy?
In a fire insurance policy, a total loss refers to a situation where the insured
property is completely destroyed or damaged beyond repair due to fire. In this
case, the insurance company is required to pay the policyholder the full amount
of coverage specified in the policy, up to the policy limits. The amount of the total
loss is typically determined by the insurance company through an assessment of
the damage and an evaluation of the value of the insured property. If the total
loss is confirmed, the insurance company will pay out the full amount of coverage
specified in the policy, minus any applicable deductibles.
What are the biggest risks in fire safety?
There are several key risks that can impact fire safety and insurance coverage
related to fire damage. These include:
a. Property hazards:
Certain types of property hazards, such as the presence of flammable materials, outdated electrical systems, or improper storage of combustible materials, can increase the risk of fire damage
b. Fire prevention measures: Failure to implement adequate fire prevention measures, such as installing smoke detectors, maintaining fire extinguishers, or having a fire evacuation plan in place, can increase the risk of fire damage
c. Natural disasters: Natural disasters, such as wildfires, earthquakes, and floods, can also pose a significant risk to property
d. Arson and other intentional acts: Arson and other intentional acts of fire damage can be difficult to prevent and may not be covered under standard fire insurance policies.
a. Property hazards:
Certain types of property hazards, such as the presence of flammable materials, outdated electrical systems, or improper storage of combustible materials, can increase the risk of fire damage
b. Fire prevention measures: Failure to implement adequate fire prevention measures, such as installing smoke detectors, maintaining fire extinguishers, or having a fire evacuation plan in place, can increase the risk of fire damage
c. Natural disasters: Natural disasters, such as wildfires, earthquakes, and floods, can also pose a significant risk to property
d. Arson and other intentional acts: Arson and other intentional acts of fire damage can be difficult to prevent and may not be covered under standard fire insurance policies.
What is the key clause in burglary insurance?
The key clause in burglary insurance is the burglary clause, which outlines the
coverage provided by the policy in the event of theft or burglary. It typically
specifies the terms and conditions of coverage, including definition of burglary
a. Coverage limits
b. Deductibles
c. Requirements for reporting
d. Exclusions
a. Coverage limits
b. Deductibles
c. Requirements for reporting
d. Exclusions
