Fire Insurance

Fire implies the actual ignition of something which out not to be on fire. It must be accidental or fortuitous so far as the insured is concerned.The fire need not originate in the insured premises, so that if a fire occurs in a nearby premises and as a result damage by scorching or blistering is caused to the insured property, that would be recoverable under the policy. A standard Fire Policy is used as the basis for almost all business insurances. The purpose of such a policy is to provide compensation to the insured person or firm in the event of damage to the property insured(i.e. buildings, stock and other contents)

Standard Fire Perils Covered

  • Fire
  • Lightning
  • Limited extent of explosion
Allied/Special Perils
Because of the narrow range of cover offered by the standard Fire policy in its basic form, a number of extra perils, known as Special Perils, can be added to the basic policy.
The special perils are grouped under the following broad headings;
  1. Perils of a chemical type: Explosion, Spontaneous fermentation or heating.
  2. Social Perils: Riot & Strike, Civil Commotion,malicious acts
  3. Perils of nature: Storm,Flood,earthquake,subterranean fire,subsidence,ground heave, landslip
  4. Miscellaneous Perils: Escape of water, impact by aircraft, animals.
  5. Malicious Damage
    This is only available as an extension of the Riot cover. The clause excludes damage arising from theft or in respect of any building which is empty or not in use.
  6. Spontaneous fermentation or heating
    The exclusion of this peril in standard fire section of the policy applies only to the property which itself spontaneously ferments or heats: the resulting damage to the other property is covered.
    Although requests for the extended cover are infrequent, farmers will often need the cover for hayricks and bulk storage of the crops. The storage of other property in bulk may also give rise to requests for the inclusion of this special peril.
  7. Explosion
    Limited explosion is given under standard Fire. However the special perils section offers additional explosion coverage which includes explosion due to other causes. These are mainly emanating from chemical reactions which produce suddenly expanding gases. Flammable vapors and gases are encountered in many industries, often being released from solvents like paints,sprays.Bulk storage of cereals and sugars will also give rise to explosion.
  8. Exclusions
    Explosion of the insured’s own steam & other pressure vessels which are subject to inspection requirements by statutory regulations.(such items are insurable under an engineering explosion policy)
    Explosion caused by acts of terrorism.
  9. Subsidence, Ground Heave and Landslip
    Subsidence – This is the movement of the land on which the premises stand due to movements, falls or changes in the underground workings, such as coal mines; movement of foundations made on dissimilar types of soil,e.g sand and clay which reacts differently to changes in moisture content.
  10. Ground Heave
    this is what happens when ground previously having a low moisture content is suddenly able to absorb more moisture; e.g. post –drought conditions. The ground quickly takes up moisture, swells and ground heave results.
  11. Impact Collision
    Cover is restricted to losses resulting from vehicles or animals owned by or under the control of third parties(not insured) against whom the insured generally has a right of recovery. Animals and vehicles owned by the insured, occupiers of the premises and their employees are excluded.


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