Question

Explain any four losses that are not covered under fire insurance policy.

Hint:

War, riots, theft after fire, and self-heating = not covered under standard fire policy.

Answer 1

A standard fire insurance policy provides coverage for losses due to fire, lightning, explosion, etc.
However, certain risks and losses are specifically excluded to prevent misuse and limit the insurer’s liability.
Here are four losses that are not covered under a fire insurance policy:
1. Loss due to War and Nuclear Risks — Any loss or damage caused by war, invasion, civil war, or nuclear reactions is excluded.
These are extraordinary risks that cannot be calculated easily and are covered by separate special policies if needed.
2. Loss due to Riot or Civil Commotion — Unless riot cover is specifically added as an extension, damage due to riots, strikes, or acts of civil commotion is not covered under a basic fire policy.
This protects insurers from large unexpected liabilities during public disturbances.
3. Loss due to Theft after Fire — Fire insurance does not cover theft or burglary losses that may happen after a fire incident.
For example, if goods are looted from the premises after a fire breaks out, this loss must be covered under burglary insurance, not fire insurance.
4. Loss due to Spontaneous Combustion — Loss caused by self-heating, fermentation, or spontaneous combustion is generally excluded.
However, coverage for spontaneous combustion can be added by paying an extra premium and following specific conditions.
These exclusions ensure that only genuine fire-related losses are paid and help keep premiums reasonable.