Fire Insurance – Far More Important than One Might Think

PUBLISHED March 11, 2021 | updated March 11, 2021 04:23

Fundamentally, a fire Insurance policy covers damages caused to your home or property. Consequently, a fire policy also compensates for damages caused by certain other incidents.  However, as advised by insurance experts, you must make sure your policy meets your requirement and are beneficial for both parties.  

If we take a look on MNDF’s Fire and Rescue Department’s Statistics for the past 3 years, a total of 674 fire incidents have been recorded. Out of which, 189 cases in 2018, 283 cases in 2019 and 202 cases were recorded in 2020.  

Most of the incidents caused within households were due to kitchen emergencies, like forgetting to turn off the stove. 72 such cases were recorded.  

Some other common fire incidents in households were caused due to electrical errors. Wrong wiring, using of unauthorized electrical devices and failing to abide by the safety measures and regulations. More than 50 of such cases were recorded within the past 3 years.  

There were also a few recorded cases where fire incidents occurred due to throwing cigarette butts out the balcony or windows.  

According to the Fire and Rescue Services, majority of the community lacks knowledge on responding to fire incidents. There have been many cases in the past where water has been used to calm down the fire caused on pans. During such an event, putting a lid on the pan could simply reduce the fire. However, without much knowledge, people instead use water, and this has caused numerous damages. A fire extinguisher in these situations can be an alternative solution. But one must remember to use a dry chemical extinguisher. Hence, it is necessary to install proper fire protective devices in your kitchens. Meanwhile you must obtain knowledge on using these devices. It is also important to have the fire and rescue hotline number 118 written on plain sight.  

Why is a fire insurance policy absolutely necessary?   

While we live in this congested Male’ where buildings lean on each other, an uncontrolled fire situation can burn up a lot of people’s property and belongings in mere minutes. The devastating fire incident occurred in 2019, was one such event that effected the lives of many.  Numerous people lost their belongings, their homes and were left roofless. Government had to provide temporary living situations for those who were left helpless. Compensation for the burned houses and belongings were only manageable to those who had insurance covers prior to the incident. Yet all those people living for rent were left with no options.  

In the greater male’ region, most land owners construct their houses by taking bank loans, or by going to an agreement with a construction company. If you are to construct your house through a bank loan, the bank requires you to insure the building. But in most cases people opt for a cheaper insurance policy which is a basic fire insurance policy in which the buildings complete value is not included. And once the loan is paid back, most people do not renew their insurance policies. Yet a fire incident and can bring a building worth million to the ground in minutes. If the building is uninsured there’s nothing much anyone can do about it at that point.  

In some cases, even though the fire doesn’t spread, major damages are cause by just the smoke and heat. These damages can also be covered if you have a proper insurance policy. Therefore, its important that you renew your fire insurance policy. You may not be able to benefit properly unless you insure your home according to its value.  

What is covered in a fire insurance policy? 

Although the name states ‘fire’ insurance, this policy not only compensates for damages caused by a fire, but additionally covers damages caused by lightning and explosion. It also covers for several other damages caused by strike or malicious damage.  In a city where several accidents occur due to speeding, there has been cases where vehicles have damaged buildings and property. Allied Insurance company’s Fire insurance policy includes cover for damages caused by such an accident. Damages caused by natural disasters such as storms or flooding and damages caused by theft are among common incidents that happen around us, from which you can get protection by choosing a proper fire insurance policy that best fits your situation.  

Loss of rent coverage 

One of the greatest fears for land owners who depend on tenants would be damage to their building which would then lead to loss of rent. If landowners choose a proper fire insurance policy, they can get a cover for such an event. Insurance company will provide the rent they lose, and will also arrange temporary accommodation for the tenants. Therefore, it is important to add “Loss of rent” and “Alternative accommodation” in your fire insurance policy.  

Tenants home content coverage 

Fire insurance policy provides certain benefits to tenants who have valuable content in their homes such as refrigerators, furniture, Television or other such valuable items can be insured in a fire insurance policy.  A home owner’s insurance policy will not cover for their tenant’s valuable items. Yet the tenant can separately insure their belongings now. Insuring MVR 200,000 worth of content only costs you MVR200 per year at today's insurance market in the Maldives. Therefore, passing this information is absolutely necessary at this day. 

In a city such as Male’ where there is a fire incident waiting to happen right around the corner, it is always smart to lookout for yourselves and others. Stay safe and gather enough knowledge on how insurance can help protect you and everyone around you. Insurance experts at Allied Insurance company have 24hr service to address your concerns. You can simply call them at 1600.  


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