Question

For what kind of loss does the insurer agree to indemnify the insured under the contract of ‘Fire Insurance’?

Hint:

Fire insurance = protection from accidental fire loss only, not for losses due to theft, flood, or other causes.

Answer 1

A fire insurance policy is a contract between the insurer and the insured to cover the risk of fire damage.
Under this contract, the insurer promises to indemnify the insured for any financial loss caused by accidental fire.
This means if a building, house, stock, or machinery gets damaged due to fire, the insurer will compensate for the actual loss.
Fire insurance policies often include coverage for loss due to accidental fires, explosions, or lightning that may result in fire.
However, it only covers fire-related loss — other risks need separate insurance.
The insured must prove that the loss was caused by fire during the policy period to claim compensation.
Therefore, the insurer agrees to indemnify the insured for loss or damage caused by fire.