FIRE INSURANCE

Insurance that offers protection of your property against fire-related damages is called 'Fire Insurance'. However, this insurance is completely different from property insurance where the inclusion list includes the expenses incurred during reconstruction, repair or replacement of not only the insured property, but also nearby affected structures if any. Other coverages include damage to the personal property other than the insured and expenses of those who are affected due to the property damage.

FIRE INSURANCE

Insurance that offers protection of your property against fire-related damages is called 'Fire Insurance'. However, this insurance is completely different from property insurance where the inclusion list includes the expenses incurred during reconstruction, repair or replacement of not only the insured property, but also nearby affected structures if any. Other coverages include damage to the personal property other than the insured and expenses of those who are affected due to the property damage.

Scope of Fire Insurance Policy

Fire insurance offers complete protection against damage, due to fire explosion, caused to movable or immovable property.
Fire insurance includes damages to the properties including an office building, furniture, plan, stock, machinery etc.
Other than fire perils, this policy also includes damages due to natural disaster, landslide, explosion, bursting of water tank etc.

Types of Fire Insurance Policy

Specific policy: In this policy, a specified sum insured is decided for a certain property and in the event of any loss; the actual loss doesn't exceed the chosen insured amount.
Comprehensive policy: This policy offers coverage, not only, against fire-related accidents but, also covers you against other risks including theft, lightning, burglary, civil commotion, damage or loss due to pests etc.
Valued policy: At the time the policy initiates, the value of the property is decided. Instead of the current market value, the indemnity of the policy is decided based on the value of the property. So, the value agreed during the time of the inception of the policy is the deciding factor of policy indemnity here.
Floating policy: This is beneficial if you deal with fluctuating stocks in different areas. This policy offers coverage for one or more goods at the same time under one sum assured and one premium.
Valuable Policy: Under this policy, the claim amount is determined based on the present market price of the damaged property.

As the policy covers a wide range of perils, it is termed as Standard Fire and Special Perils Policy as well.

S. No.	Fire Insurance: Inclusion
1	Fire: The policy offers coverage for any damage caused owing to the fire. However, damage caused by natural heating, own fermentation or spontaneous burning are excluded.
2	Lightning: Damages caused by lightning is covered. If lightning cause fire, or other damages like cracks in the building or roof area, it will be covered by fire insurance.
3	Explosion: Fire damage caused by an explosion is covered by this policy.
4	Aircraft Damage: Fire and any other damage caused by aircraft or other airborne devices, damage due to articles dropped by an aircraft is covered by fire insurance policy.
5	Terrorist Activity, Riot Strike: If the insured property is damaged due to a strike, riot or any terrorist activity, the loss is covered by fire insurance.
6	Natural Disasters: Apart from the above, this policy also includes damages owing to natural disasters including storm, cyclone, typhoon, tornado, flood. The hazardous situation and consequences of a natural disaster are covered by fire insurance.
7	Landslide/Rockslide: Your insurer will offer protection under fire insurance for the destruction caused to your property to a notable or even a small part of the site where the property exists by rockslide/landslide.
8	Bursting of water/overflowing of Water Tank: If your property is damaged due to the bursting of water or overflowing of the water tank, the policy covers the damage.
9	Bush Fire: At the time you set fire to overgrown plants and bushes, the possibility is where you end up damaging the property. Fret not! The fire insurance policy that you own covers you for this as well. However, the policy wouldn't cover the destruction due to the forest fire.

Exclusions of Fire Insurance Policy

S. No.	Fire Insurance: Exclusions
1	No damage due to nuclear perils, nuclear waste or radioactivity are covered
2	Loss or damage to any electrical machines, excessive pressure, short circuit, leakage of electricity, arcing, apparatus etc. are not included
3	Loss or damage due to theft or expense incurred directly or indirectly caused by any kind of terrorist activity are not covered by the policy.
4	Damage due to war, invasion, civil war, commotion, mutiny warlike situations is always excluded.
5	Damage or loss to the stock due to change in temperature; loss or damage directly or indirectly by some of the natural disasters like earthquake, volcanos etc. are in the exclusion list as well.
6	Loss of earning, loss of delay or market loss, consequential loss is not covered by fire insurance.

Who Are Eligible to Take Fire Insurance Policy?

This insurance is meant for any person/organisation/institution/firm who may suffer or want to protect his/her business from an unanticipated loss in the event of a fire.

Anyone who owns building, furniture, household articles etc.
Retailers or shopkeepers, godown keepers.
Banks, financial, education, research institutes, trustee, charitable institute.
Service providers including hotel owners, hospitals, lodging, clinics etc.
Manufacturing and industrial firms, transporters.

Add-on Coverage

On payment of an additional premium, the insured can be entitled to below add-on coverage:

Earthquake
Wreckage removal
Forest fire
Loss of rent
Startup cost
Alternate accommodation
Spontaneous burning
Damage to stock due to change of temperature
Leakage and contamination cover
Architect, engineers, Surveyors consultation fee
Cover for molten metal spillage
Impact loss owing to insured's own road/rail transit