What Do You Want to Safeguard Today?
Bharat Griha Raksha
Bharat Laghu Udyam
Bharat Sookshma Udyam
Fire Loss of Profit
Griha
Standard Fire & Special Perils
What is Fire Insurance?
As the name implies, fire insurance covers the expenses and losses incurred by the policyholder due to fire-related incidents. These fires may result from various causes, including natural disasters like storms and lightning or human-related events such as faulty wiring, gas explosions, or riots. A fire insurance policy compensates for damages and repairs.
In legal terms, this type of coverage is referred to as Standard Fire and Special Perils Insurance.
Why is Fire Insurance Necessary?
Fire insurance protects policyholders against losses or damages caused by fires from numerous sources. These can include:
- Fires caused by electrical issues like faulty wiring or gas explosions.
- Fires resulting from natural disasters such as lightning or storms.
- Damages from burst or overflowing water tanks and pipes.
Who Should Consider Buying Fire Insurance?
Educational Institutions
Schools, universities, and online coaching centers.
Businesses
Retailers, shopkeepers, and warehouse owners.
Manufacturing Firms
Factories, industrial sites, and cottage industries.
Individuals
Homeowners, garage owners, or anyone with personal property at risk.
Service Providers
Medical clinics, restaurants, and lodging facilities.
Other Institutions
Banks, research facilities, and corporate offices.
Key Characteristics of Fire Insurance
Full Disclosure of Property Details
Fire insurance requires complete and accurate disclosure of all property details. Any misrepresentation of facts is considered a serious offense and can render the policy void. A detailed description of each item covered under the policy is mandatory to ensure reimbursement for losses or damages.
Personal Insurance Contract
Fire insurance is a personal agreement between the policyholder and the insurer. The insured’s actions directly affect the terms of the policy. Claims can only be made by the person named in the policy document.
Fire Must Be the Sole Cause of Loss
Compensation is provided only if the damage to the insured property is caused by an actual and accidental fire. Losses that do not directly result from fire are not covered under the policy.
Annual Contract
Fire insurance policies are valid for one year and need to be renewed annually. If the policy is not renewed, the insurer is not obligated to compensate the insured after its expiration.
Insurable Interest
The policyholder must have a financial or vested interest in the insured property. The loss or damage to the property should have a direct impact on the insured’s life or financial standing to qualify for coverage.
Principle of Indemnity
Fire insurance operates on the principle of indemnity, meaning compensation is provided only for the actual damage caused by fire. If there is no damage, the insurer is not liable to pay any amount.
Standard Fire & Special Perils Insurance
| Types of Calamities | Inclusions | Exclusions |
| Fire | Destruction or damage to insured personal property. | Damages caused by natural heating or drying processes. |
| Lightning | Damage such as cracks in the roof, building damage, short circuits, and related fires. | None. |
| Explosion | Damage to property caused by exploding items. | Damage caused by non-domestic boilers or steam-generating vessels. |
| Aircraft Damage | Loss or destruction caused by aircraft or falling objects. | Damage caused by pressure waves. |
| Riot, Strike, and Malicious Damage | Physical damage and fire caused by external forces. | Fires resulting from burglary, theft, or larceny. |
| Impact Damage | Fires caused by the impact of vehicles or animals. | Damage to the insured person or employees. |
| Subsidence & Landslides | Fires caused by the subsidence (sinking) of the ground at the insured site. | Damages caused by normal cracking, settlement, bedding down of new structures, or coastal/river erosion. |
| Bursting & Overflowing of Water Tanks, Apparatus, and Pipes | Damage caused to insured property due to bursting or overflow. | None. |
| Leakage from Automatic Sprinkler Installations | Damage and fire caused by sprinkler system malfunctions. | Fires caused by burglary, theft, or larceny. |
| Missile Testing Operations | All fires resulting from missile testing. | None. |