A fire policy, usually called fire and burglary insurance, offers coverage for the insured property, land, building and commodities covered under the policy. It is a type of property insurance that offers financial benefits to the insured party against incurred losses and damages due to fire.
The concept of “business” encompasses multiple aspects, such as the goods, people, customers, profits, turnover, risks and losses. It is an entrepreneur’s fundamental responsibility to offer sufficient financial and emotional protection, and fire insurance is one way of doing it!
In this blog, we learn how fire insurance protects your business and business property.
Types of Fire Insurance Policies for Your Business Property
- Standard Fire Insurance
- Industrial All-Risk Insurance
- Consequential Loss Fire Insurance
Importance of Fire Insurance for Business Property Protection
● Financial Coverage
One of the many fire insurance benefits is that it offers financial protection for your business property. Even if it is the property and assets that get affected by the fire, your business might experience severe burns when it comes to financial health.
It is wise to protect your financial stability with a fire insurance policy from a trustable insurer like TATA AIG rather than drowning in unwanted liabilities and losses.
● Property Coverage
Fire and burglary insurance adequately compensates you for any and every loss incurred by the insured property. If the loss and damage were caused due to fire or other fire perils that are mentioned in the inclusions of the policy, you will receive financial compensation.
● Legal Liability
With the help of a fire insurance claim, you can pay off your legal liabilities. Suppose you have caused harm or damage to a third party in the fire incident concerning the insured property; this financial tool offers protection against these third-party liabilities. The coverage includes any damage caused to a person or property in the form of asset loss, disability, death or other.
● Minimising Disturbance
Your business will experience difficulty continuing its functions after the fire incident. The property requires repairs, reconstruction, amendments and many other things before it gets back to its operations.
In order to get back to basics, you need a lot of financial support. Your fire insurance policy provides funds for the repairs, amends and more to minimise business disturbances.
● Reconstruction and Replacement
As mentioned above, your fire insurance policy provides funds for repairs and reconstructions. If the insured property experiences loss and damage due to a covered fire peril, the insurer will offer adequate funds and financial coverage for making the repairs, reconstruction and replacements.
● Risk Mitigation
A property is vulnerable to innumerable fire perils. However, it is always a good practice to protect your business property as much as you can. With the help of modern technology, you can set up fire safety and security systems to avoid fire and burglary in the insured property.
Insurers usually offer discounts on premiums for policyholders who install fire safety systems to motivate the implementation of safety measures.
● Fire Insurance Policy Features
A fire insurance policy functions on a set of rules and principles. These features themselves act as fire insurance benefits. They include insurable interest, utmost good faith, contract of indemnity, direct cause of loss, accurate description of property, personal contract basis, personal right, valuation, premiums, limits and deductibles.
● Inclusions and Coverage
The most common inclusions and coverage of good fire insurance are given below:
- Fire
- Bush Fire
- Explosion or Implosion
- Lightning
- Landslides
- Missile Testing Operations
- Riots, Deliberate Attacks and Strikes
- Overflowing of Water Tanks
- Automatic Sprinkler Leakage
- Earthquakes and Volcanic Eruptions
- Storms, Cyclones, Floods and Other Natural Calamities
- Theft Due To The Occurrence of Above Event
You are advised to read the policy papers thoroughly. Your fire insurance policy documents mention a list of exclusions. These are the incidents when your policy provider will not offer any financial coverage whatsoever.
Some common exclusions are damage to property and goods that are not insured, theft that happens outside of your property when the burning of the property is ordered by a public or government authority, and more.
Conclusive Thoughts
Fire insurance is an indispensable tool that protects your business against a devastating loss caused by fire or other fire perils. Investing in fire and burglary insurance, which is different from fire and theft insurance, for your business will be one of the best decisions you will ever make to protect your business property. Buy from a good provider to face uncertainties with a certain mind.
