This is a type of nonlife insurance that covers your house, business, or any property against direct losses by fire or lightning. You may also add coverage against acts of nature coverage such as floods, typhoons,s or earthquakes. Other man-made causes like robbery, burglary and riot, strike, and malicious damage may also be added to your insurance policy.

What is a Fire Insurance?

It is nonlife insurance coverage against direct losses of fire, lightning, and/or by removal from the premises endangered by the perils insured against.

Property owner’s insurance protects policyholders from loss and/or damage to their houses and personal belongings, often known as insured property. This is a broad phrase that encompasses both the interior and outside of a home, as well as any assets stored on the premises. Injuries sustained while on the premises may also be covered by the policy.

If you have a mortgage, your lender is likely to refuse to advance your loan unless your home is insured. It’s a good idea to protect oneself even if it’s not required. Additional types of coverage, such as fire insurance, can be purchased to insured property liabilities.

The insurance company may actually reimburse the home’s current market value if it is declared a total loss. The insurance provider usually compensates for lost belongings at market value, with the total payout set at the home’s overall value. Many rules limit the amount of money that can be reimbursed for luxury products including paintings, jewelry, gold, and fur coats.

Kinds of Fire


The fire that is deliberately kindled and is within the limits intended for it only, such as cooking


The fire that goes beyond the confines intended for it or goes beyond the custodian of man

When does a Fire Insurance Claim become compensable?

must have flame or ignition of sustaining velocity

must be a hostile fire

must be caused by an accident and not intentional

must be the proximate cause of the loss or damage

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Basic Fire Insurance Coverage

Fire and/or Lightning Cover

Loss or damage caused by the following:

  • Fire
  • Lightning
  • Losses as a direct result of a fire such as heat, smoke, water damage from firefighter’s efforts to extinguish the fire
  • Loss or damage while trying to save the property from the perils insured against

Optional Fire Insurance Policy Coverage

Earthquake Fire

This covers direct losses or damages caused by fire following an earthquake

Earthquake Shock

This covers loss or damage (other than fire) occasioned by or in consequence of an earthquake

Full Earthquake

Combination of Earthquake Fire and Shock


Loss and damages caused by a typhoon – must be a typhoon declared by PAG-ASA


Loss and damages caused by the entry of water into the insured premises due to flooding of land not usually covered by water:

  • extra-ordinary high tide
  • following typhoon, cyclone, or windstorm
  • bursting or overflowing of rivers, reservoirs, canals, and the like

Extended Coverage

This is an additional coverage relating to causes not directly by fire such as smoke damage, falling aircraft, vehicle impact, and external explosion.

Riot and Strike

This refers to loss or damage caused by strikers, persons disturbing the peace, and/or lawful authorities acting to suppress or prevent disturbance.

Properties that can be covered

Building and Improvements

Structures and partitions are covered for the building and built-in cabinets and the like falls under improvements.


The following are covered:

  • furniture, fixtures, and fitting
  • appliances
  • stocks
  • machinery and equipment

Factors affecting Insurance Premium


Buildings in urban locations typically have higher fire ratings than those that are surrounded by trees or located further from municipal fire protection and response. If a business is within 500 feet of a fire hydrant, it is more likely to receive favorable fire ratings.

  • Exposure. External fire dangers can damage your fire rating even if your company is the only occupant of the building. If your business is near a hotel, lumberyard, industrial facility, or another structure, for example, you may be exposed to the higher fire hazards of surrounding properties.

Construction of the building

Class A refers to the property made out of cement from the first floor up. Class B on the other hand refers to typical old types of structures of houses where the first floor is made of cement and the second floor is made of wood. And the last classification is those properties made out of light materials only.

Materials for construction. Ensuring older structures or those constructed of highly combustible materials will naturally be more expensive than insuring newer structures or those made of fire-resistant materials. The use of flammable materials in walls or stairwells will almost certainly affect the fire rating, whilst adding fire-resistant interior walls and safe fire doors may result in premium discounts.

Construction of the building


There are 4 types of occupancy depending on the usage of the property:

  1. Residential – townhouse, subdivision
  2. Industrial – factories, manufacturing
  3. Warehouse – storeroom, storehouse
  4. General – all other establishments not under those above such as schools, markets, churches, etc.

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