Fire insurance in India underwent a growth of 28.1% in FY21. Property insurance formed the 3rd largest general insurance market in 2021 and had a 25.4% share of Gross Written Premiums. The figures imply that both kinds of insurance have a high demand in the country. But in what aspects do they differ? Here’s a look.
What is Property Insurance?
It covers properties and buildings against any damages or losses. Sometimes, it also covers the property’s contents like machinery, furniture, electronics, jewelry, clothes, and inventory. The cause of the damage could be lightning, storm, earthquake, burglary, theft, or fire. That is, it can be man-made or natural. Property insurance can be availed by owners of both residential and commercial properties.
What is Fire Insurance?
Fire insurance covers only accidents caused by fire and related damages. These include losses due to an unexpected breakout of fire, thunder, smoke, explosion, implosion, and lightning. Therefore, fire insurance can be seen to fall under property insurance. Property insurance covers many other perils.
How Do Fire Insurance and Property Insurance Differ?
Fire insurance solely covers accidents directly or indirectly caused by fire. Damages caused due to sources other than fire won’t be covered. But property insurance covers any kind of peril including natural calamities, theft, burglary, and fire.
Cost of Premium
Because property insurance offers wider coverage and more comprehensive benefits to property owners, it is naturally associated with higher premium rates than those of a standalone fire plan.
Fire insurance is essentially available for owners of private property. However, property insurance is more helpful since it offers comprehensive protection for all kinds of properties. You can restore your home after fire damage easily.
Compare the benefits of both kinds of insurance and opt for the right one based on your needs and affordability. When your property is protected, you are protected.