Fire is a serious risk for all physical structures, whether it’s your house or your shop. This is why insurance is very important to lessen the loss caused to building, machinery, goods, furniture and fixtures, plumbing, electrical appliances, and other assets in the event of a fire.
Under fire insurance, the insurer agrees to compensate to any loss or damage during the policy term, not exceeding the maximum amount for which the premium is being paid. Here are some of the features offered by India’s fire insurance companies that you should keep in mind.
As per the Indian Insurance Act 1938, in addition to fire, other perils are also joined with the insurance plan known as the “Standard Fire and Allied Perils Policy.” The policy also covers losses on account of lightning, storms, floods, earthquakes, landslides, bush fire, explosions, aircraft damage, riots or malicious damage, etc.
There are different types of policies one can make a selection from while purchasing fire insurance in India. A comprehensive policy even covers theft or burglary, whereas floating is useful for businesses with assets or stocks in different places. Transit policy covers the risk due to fire during the transit.
Thus, fire insurance companies in India allow you to pick a policy based on your individual needs. There are many different policies available you can purchase according to your requirement.
Few insurance companies offer covers on fire insurance policies such as compensation for architect or surveyors fee, temporary removal of assets, loss of rental income, or rent for an alternative house till you rebuild your home or business.
Fire insurance is based on this principle or utmost good faith, where the insured party makes full and honest disclosure of all facts. Failure to do so can render the policy to be invalid and relieve the insurer of any financial responsibility.
The insured party must have an insurable interest in the asset at the time of purchasing the policy and at the time of the incident. For example, you insured your house but sometime later sold the house to someone else. In this case you cannot claim if the place catches fire even while the policy is active as you have no insurable interest in the property anymore.
The tenure of the coverage is clearly stated in the policy document. Usually, the insurance does not exceed one year so make sure you renew it at the proper time for continued coverage.
Like any other insurance policies out there, fire insurance policy also has its exclusions. Damages caused by normal heating, own fermentation, or instinctive burning; any loss or damage of the property due to nuclear hazard, electrical or mechanical breakdown and terrorist attack, and war like operations are some common exclusions of fire insurance companies in India. Fire insurance ultimately offers you with financial security for your home or business to help you get back to your normal life as soon as possible.