Fire insurance is one such policy in which an individual agrees to pay a certain sum of money to the insurer in exchange to get benefits for the fire losses. The importance of Fire Insurance for Home Owners & Businesses cannot be downplayed.
A fire insurance policy offers comprehensive security for stocks, business buildings, homes, etc. The policy offers financial security by covering losses or damages that may arise due to fire loss or damages.
Some events of fire losses in India –
- April 16, 1990: 70 people were killed when a fire erupted in a shuttle train in Patna.
- August 6, 2001: A fire accident occurred at a private mental asylum in Tamil Nadu.
- January 23, 2004: 49 people were killed and 40 others were injured when a fire started at a marriage hall in Tamil Nadu.
- November 8, 2016: A total of 150 shops were gutted after a fire broke out in the Jama Masjid area in Delhi.
- May 23, 2017: A major fire destroyed over 50 shops and goods worth crores in Chandni Chowk in Old Delhi.
Read More: Who Should Buy Fire Insurance Policy?
Now, let’s understand the importance of a fire insurance policy –
For homeowners:
Your home is your abode of dreams, however, any mishap like fire can arise to destroy the ‘beauty’ of your house. So, it makes sense to go with a fire insurance policy that curtails financial losses due to fire to some extent. Here are some of the advantages of a fire insurance policy for homeowners-
- It ensures the cost of damages to the building
- It gives replacement cost, which helps a homeowner to buy a similar article
- It covers replacement costs for electronic items, like computers, air conditioners, television, etc.
For Office & Factory Owners:
Irrespective of its size, every business needs a fire insurance policy. In every office, the company keeps its important files, documents, and assets. If a fire happens, it will be a great disaster. So, buying a fire insurance policy becomes important because it promises to financial guard you against losses or damages. Here are some of the benefits of a fire insurance policy for office & factory owners–
- It covers the cost of stocks damaged in a fire
- In some cases, it gives death benefits to the family of the employee if he/she dies in a fire accident
- It gives the replacement or repair cost of the machines in case they are damaged due to fire
Remember, fire accidents are unexpected and destructive. A fire insurance policy gives financial security for homes, furniture, shares, and other business assets. The policy is useful as it gives the price of properties and assets which get damaged due to fire. Hence, having a fire insurance policy is necessary for personal, social, and national sectors.
Case: 1
It was the most memorable day of the lives of Raj and Kavita when they first time entered their own house which was also their first big joint investment after marriage. The excitement of living in their ‘own’ home was so big, that they decided to discard all the furniture which they had in their rented apartment. They hired an interior decorator who designed the entire house with a new style. The couple spent around five lakhs on furniture and fixture.
Read More: Which Assets are Not Covered by The Fire Insurance Policies?
However, a few days ago, a fire erupted in the house when Kavita forgot to switch off the iron as she was in a hurry to drop her son, Arthav at school. When she came back, a fire erupted at the ironing table. Though she was able to douse the flames on time, not before the bed, carpet, and dressing table caught fire. Luckily, the couple had bought a fire insurance policy at the time of buying the house, and therefore, their insurer came forward to cover their losses. The insurer appointed a surveyor who calculated the total fire loss as Rs 80,000. Thankfully, the couple did not have to incur major financial losses as their fire insurer was there to help them.
Case: 2
Mrs. Anjali Mehta bought a fire insurance policy to insure her fancy shop for Rs 4 lakh. Last year, the shop met with a fire accident due to short-circuit. She immediately called up the police, and fire brigade and informed her insurer also. The insurer appointed a surveyor who estimated the loss as Rs 2 lakh and after carefully reviewing the policy document and surveyor’s report, the insurer settled the claim.
About The Author
Shivani
MBA Insurance and Risk
She has a passion for property insurance and a wealth of experience in the field, Shivani has been a valuable contributor to SecureNow for the past six years. As a seasoned writer, they specialize in crafting insightful articles and engaging blogs that educate and inform readers about the intricacies of property insurance. She brings a unique blend of expertise and practical knowledge to their writing, drawing from her extensive background in the insurance industry. Having worked in various capacities within the sector, she deeply understands the challenges and opportunities facing property owners and insurers alike.
