What is Covered in Your Fire Insurance Policy?

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We cannot prevent an unexpected fire, but we can buy a fire insurance policy to protect ourselves from financial loss caused by such a fire.

The Great Fire of London or 1666 Fire of London resulted in the emergence of the first fire insurance company in the world.

Fire insurance is a type of property insurance that covers loss or damage caused by an accidental fire or other perils included under a fire policy. It provides financial protection for the losses caused due to damages to movable and immovable property.

What is Covered in Your Fire Insurance Policy?

Perils covered in Fire Insurance

  1. Damages due to fire are covered. Visible flames or actual ignition is fire. In fire policy, simmering or smouldering is not considered as fire.
  2. Damages due to lightning
  3. Damages due to fire explosion
  4. Aircraft damages
  5. Property damage caused by RSMD (riot, strike, malicious damage)
  6. Any damage due to natural calamities like storms, cyclones, typhoons, floods, etc.
  7. Damages due to bursting/overflowing of the water tank, apparatus and pipes
  8. The fire spread from the bushes. But, damages due to forest fire will not be covered unless an add-on cover is taken.

General Exclusions

  1. Deliberate or intentional acts
  2. Loss/ damages caused by war and kindred perils
  3. Loss/ damage caused by nuclear peril (directly or indirectly)
  4. Earthquake Volcanic eruption (earthquake can be covered by paying an additional premium)
  5. Loss/ damage caused by pollution or contamination
  6. Fire by negligence and having a lack of fire protection instruments if mandated by Municipality.
Also Read:  Fire Insurance and Peace of Mind: The Role of Insurance Samadhan in Claims Settlement

Read the terms and conditions of your fire policy as there can be more inclusions and exclusions.

Insurance Samadhan

Features of fire insurance

  1. The person who is buying a fire policy must have an insurable interest in the subject matter (property to be insured) at the time of purchasing as well as at the time of loss. You cannot buy a fire policy for your neighbour’s house.
  2. Fire should be the proximate cause of the loss/damage.
  3. The insurance company is liable to pay the claim only to the extent of the actual loss incurred as fire insurance is a contract of indemnity. If there is no loss, you cannot ask for a claim.
  4. The insurer will only compensate the insured according to the proportion of loss up to the sum insured.


Ms. Ananya Chakrobarty bought a fire policy of Rs 10,00,000 for a property worth Rs 20,00,000. Sum insured was Rs 10,00,000.

Later half of the property was damaged due to a fire. The insurer will pay only Rs 5,00,000.


Actual value of the property: Rs 20,00,000

Sum insured: Rs 10,00,000

Actual Loss: Rs 10,00,000 (as half of the property was damaged due to fire)

Claim Payable: (Sum insured X Actual Loss) / Actual value of the property

= (10,00,000 X 10,00,000) / 20,00,000

=Rs 5,00,000

Since half of the property was damaged, the complete amount of the policy shall not be payable.

Why should one buy fire Insurance?

Whether you are running a business or you are a house owner, fire insurance protects you from financial loss caused due to accidental fire.

Click here to know the procedure and documents required for a fire insurance claim

Also Read:  Top 5 Factors that affect your Fire Insurance Premiums

Go ahead and buy a fire policy.

In case of any insurance-related complaint, you can approach Insurance Samadhan. 

Insurance Samadhan is a private body run by seasoned professionals. You can view many testimonials through our website. Visit our website to know more.

Click on the below links to read some cases resolved by Insurance Samadhan:

Health Claim Rejection amid Covid-19

Mis-selling in a life insurance policy

Death Claim Rejection

Click here to register your complaint with Insurance Samadhan

You can also

Visit our website: insurancesamadhan.com

Call us on +91 9513631312

WhatsApp: 9910998252

Mail us at corporate@insurancesamadhan.com

Insurance Samadhan

Shailesh Kumar

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