Fire & Property Insurance

Fire insurance provides protection against most risks to property, such as fire, theft and some weather damage. This includes specialised forms of insurance such as fire insurance, flood insurance, earthquake insurance, home insurance, or boiler insurance. Property is insured in two main ways, open perils and named perils.

Open (PAR) perils cover all causes of loss not specifically excluded in the policy. Common exclusions on open peril policies include damage resulting from earthquakes, floods, nuclear incidents, acts of terrorism, and war. Named perils require the actual cause of loss to be listed in the policy for insurance to be provided. The more common named perils include such damage-causing events as fire, lightning, explosion, and theft.

There are three types of insurance coverage.

• Replacement cost coverage pays the cost of repairing or replacing your property with like kind & quality regardless of depreciation or appreciation. Premiums for this type of coverage are based on replacement cost values, and not based on actual cash value.
• Actual cash value coverage provides for replacement cost minus depreciation. 
• Extended replacement cost will pay over the coverage limit if the costs for construction have increased. This generally will not exceed 25% of the limit.

When you obtain an insurance policy, the limit is the maximum amount of benefit the insurance company will pay for a given situation or occurrence. Limits also include the ages below or above what an insurance company will not issue a new policy or continue a policy. This amount will need to fluctuate if the cost to replace homes in your neighborhood is rising; the amount needs to be in step with the actual reconstruction value of your home. In case of a fire, household content replacement is tabulated as a percentage of the value of the home. In case of high-value items, the insurance company may ask to specifically cover these items separate from the other household contents. One last coverage option is to have alternative living arrangements included in a policy. If property damage caused by a covered loss prevents you from living in your home, policies can pay the expenses of alternate living arrangements (e.g., hotels and restaurant costs) for a specified period of time to compensate for the “loss of use” of your home until you can return. The additional living expenses limit can vary, but is typically set at up to 20% of the dwelling coverage limit. You need to talk with your insurance company for advice about appropriate coverage and determine what type of limit may be appropriate for you.
 
The fire insurance policy has been named as "Standard Fire and Additional Perils Policy".

The risks covered are as follows:

•  Dwellings, offices, shops, hospitals: 
• Industrial, manufacturing risks
• Utilities located outside industrial/manufacturing risks 
• Machinery and accessories
• Storage risks outside the compound of industrial risks
• Tank farms/gas holders located outside
   

Perils covered:

The following causes of loss, to name but a few can be covered:

• Fire
• Lightning 
• Aircraft damage
• Riot, strike
• Terrorism
• Storm, cyclone, typhoon, tempest, hurricane, tornado, flood & inundation.
• Impact damage
• Malicious damage
• Subsidence, landslide
• Bursting or overflowing of tanks
• Bush fire
• Riots, strikes and civil commotion

Exclusions:

The following, to name but a few, are excluded from insurance coverage:

• Loss or damage caused by war, civil war, and kindred perils
• Loss or damage caused by nuclear activity 
• Loss or damage to the stocks in cold storage caused by change in temperature 
• Loss or damage due to over-running of electric and/or electronic machines
   

Claims:

In the event of a fire loss covered under the fire insurance policy, the insured shall immediately give notice thereof to the insurance company. Within days allowed under the policy say, in this case 15 days of the occurrence of such loss the insured should submit a claim in writing giving the details of damages and their estimated values. Details of other insurances on the same property should also be declared.