Although you may take every precaution and use the latest technology to ensure the safety of your business premises, you cannot completely rule out the possibility of an accident. Thus, fire insurance is both essential and recommended for your business.
Why is fire insurance important?
To understand the importance of fire insurance for your office or factory or warehouse, here are some aspects to consider.
Massive damage
Both fire and the efforts taken to extinguish it can be damaging. Flames and smoke due to the fire and the water or chemicals used to extinguish it can destroy the building as well as any stock and other goods inside the building. This damage can be difficult to recover from without cushion-like fire insurance.
Financial burden
The damage caused by the fire as well as the loss of business because of fire damage can be financially debilitating. Without fire insurance, you may face a financial crisis, putting at risk your ability to rebuild your business.
Cover against natural events
These days, fire insurance extends beyond covering just fire. It also provides cover for damage arising from lightning, explosions, riots, aircraft damage, etc., all of which are highly unpredictable events.
Recover the cost of expensive equipment
A fire insurance policy offers protection for a wide variety of assets. These include the building and within it, the machinery, the furniture, the electrical fittings, stocks, and other accessories. This is helpful since the money can help you re-purchase and re-stock the building as needed.
Click here to know how to file claims under a fire insurance policy in India
Case study: Fire insurance helps rebuild the business after a fire
Mr. Akhil Deo manufactures furniture for a famous brand in the city. One night, a fire broke out in his factory. Unfortunately, his guards were asleep at the time, so the fire was first noticed by a passer-by who then alerted the guards. Immediately, the guards informed the closest fire station as well as Mr. Deo. But it was too late to do anything; the fire and smoke had engulfed the whole factory by the time the firefighters reached. Eventually, the firefighters doused the fire. But the entire facility was ruined and none of the stock could be saved either.
Thankfully, the factory was insured against fire. So, Mr. Deo filed a claim with the insurance company. And they found that the fire was the result of a short circuit. Since this was covered under insurance, the claim was approved. Eventually, Mr. Deo used the money from the insurer to re-establish the factory.
