1. What Is Fire Insurance?

Fire insurance is a policy that provides financial protection against loss or damage to property caused by fire, lightning, explosion, or related perils.
It covers buildings, machinery, stock, furniture, and other assets from fire-related accidents.
The aim is to help businesses and homeowners recover from unexpected fire incidents without facing major financial hardship.

2. Why You Need Fire Insurance

✔ Protects Property & Assets – Ensures your building, equipment, and stock are protected against fire damage.
✔ Covers Fire-Related Losses – Includes damage from fire, lightning, explosion, and certain natural calamities.
✔ Reduces Financial Burden – Helps you rebuild or repair property without heavy out-of-pocket expenses.
✔ Business Continuity – Supports quick recovery after fire incidents, minimizing downtime for businesses.
✔ Mandatory for Many Businesses – Some lenders and regulatory bodies require fire insurance for commercial properties.
✔ Peace of Mind – Eliminates the stress of potential losses caused by accidental fires.

3. Types of Fire Insurance

a) Standard Fire & Special Perils Policy (SFSP)

• Covers fire, lightning, explosion

• Includes additional perils like storms, floods, riots, strikes, and more

• Most commonly purchased fire insurance plan

b) Valued Policy

• Insurer pays a pre-agreed amount on loss

• Suitable for items where actual value is difficult to determine (e.g., artwork)

c) Specific Policy

• Covers only up to a specified amount

• Claims cannot exceed the sum insured

• Ideal for assets with known value

d) Comprehensive Fire Insurance

• Covers fire + additional risks such as burglary, natural disasters, and accidental damage

• Offers wider protection for homes or businesses

e) Floating Policy

• Provides coverage for stock/inventory stored at multiple locations

• Useful for businesses with fluctuating stock levels

f) Replacement or Reinstatement Policy

• Covers the cost of replacing damaged property with new items of similar kind

• Helps restore assets to pre-loss condition

g) Add-On Covers (Optional Riders)

✔ Debris Removal Cover
✔ Earthquake Cover
✔ Deterioration of Stock
✔ Forest Fire Cover
✔ Spontaneous Combustion Cover
✔ Escalation Clause – Covers increase in asset value over time
✔ Architect / Surveyor Fees