fire insurance - a slideshow

7/31/2019 Fire Insurance - A Slideshow

1/10

Fire insurance


2/10

Fire insurance

When an insurer seeks protection against fire, lighting orexplosion and enters into a contract to indemnify the loss,it is fire insurance

Fire means light and heat by combustion and loss by

heating alone without ignition is not fire For example:-sugar is spoilt by excess heat caused due to

closing of ventilators ,no claim was paid as there is noignition

Property not intended to be ignited

Fire lighted for a definite purpose is not fire but if it breaksits bounds it is fire

Property which is accidentally or negligently thrown is lossby fire as it was not to be burnt


3/10

For example:-an insured kept currency notes and jewelleryin her grate by placing wood and coal and went out. Onreturning home she lighted the fire forgetting what she hadconcealed. The loss was indemnified as the fire burnt whatwas not to be burnt

Property damaged on ignition of other property:-damagedue to burning or smoke or falling of walls on account ofignition of other property is damage due to fire

Accidental and Fortuitous:-are within the policy. A fire

willfully or maliciously caused by third person is within thepolicy

A fire caused by negligence of insured or servant is withinthe policy


4/10

FEATURESIt does not ensure safety of property but onlymakes good the loss. It is a personal contract andif property is transferred the contract ceases

The insurer will indemnify the loss due to fireirrespective of cause of fire. The cause of firebecomes material to be investigated 1 where it iscaused by willful act 2 it is an exception in the

contract It covers entire loss and cannot be divided unless

it is expressly agreed


5/10

Insurable Interest

For insurable interest ownership is most important

If the property is charged the insurable interest lieswith financer

It must be present both at the time of undertaking thecontract and at the time of loss

In case the property is transferred the policy must beendorsed with the consent of insurer

For indemnity the market value is used so true valueshould be represented

The insurer is entitled to rights after indemnification


6/10

Who may Insure Against Fire

Owner of property joint owner or partner

The vendor and purchaser both can insure

Trustees are legal owners and beneficiaries are

beneficial owners and each can insure it Bailees such as carriers or warehouse men can insure

as they are responsible for safety

Persons not entitled to insure

An unsecured creditor cannot insure debtors propertybut his life

A shareholder can not insure property of a company


7/10

Alteration in risk of fire

Any material fact and changes in risk of fire haveto be disclosed up to the time of formation ofpolicy

If no express condition is specified increase in riskneed not be intimated

Foe example:- a building was insured wherepaper making business was carried. Once cotton

was brought and a fire broke. Held damages willbe indemnified though insurance is not givenwhere cotton is kept


8/10

Perils Insured

The perils which fire policy gives insurance cover are:-

Fire

Lighting

Explosion excluding loss to boilers

Riot, strike malicious and terrorist damage

Impact by rail/road vehicle or animal

Aircraft and aerial or space articles dropped

Storm, cyclone, tempest, flood and tornado Landslides resulting in collapse of entire or part of

building

Earthquake fire and shock


9/10

Excluded Perils

The insurer is not liable to indemnify the following losses:-1. loss by theft after or during the occurrence of any insured peril

2. loss due own heating process .e.g. loss to stack of hay or coal dueto own heating is not covered but if fire spreads and burns otherstacks then it will be indemnified

3. loss due to (a)orders of any public authority (b) subterranian firewhich is below the ground

4. loss due to nuclear weapon material

5. loss to any electrical machine due to excessive pressure, shortcircuiting, self heating and leakage of electricity. This exclusion is

not applied to other machines 6. loss due to war, invasion, act of enemy, civil war, munity,

commotion


10/10

When and how to make claim

On the happening of any loss the insured mist givenotice in writing to the insurer

Within 15 days the insured must submit in writing thedetails of loss and submit it to insurer

The insurer at his own expense collect all documents,proofs and information that is required by the insurer

He should give a declaration that all information is true

Within 12 months the of loss the insured should inform

the insurer otherwise it will be a case of pending action If the insured makes any fraudulent claim then all

benefits under the policy are forfeited

fire insurance - a slideshow

Documents