Understanding fire insurance policies

A good fire insurance policy is always a good investment; however the numerous paper works involved always makes the process look cumbersome to the customer.

fire insurance


The following terms will help you understand your insurance policy better hence achieve the value of your money.

  • Arson: This is intentionally setting up a fire or any attempt to light up a fire to property.
  • Cash value: This is the value of an item in its used condition.
  • Construction type: This is the type of material used in the construction of a house or property like bricks and wood. A person with a wooden house will pay a higher policy than one with a brick house because wood is more prone to fires than bricks.
  • Coverage: The amount of money that your policy covers against the damage of a certain good.
  • Deductable: The amount of money that you agree to pay when filling for an insurance claim.
  • Insurance premiums; this is the amount of money paid to the insurance provider at the end of every month as agreed in the policy agreement. This is later broken down to various allotments in the specific areas of the insurance coverage.
  • Perils; Any cause of damage to property. They include fire and smoke.
  • Policy declaration: This is a specification of your coverage, monthly payment, policy limits and deductibles that is on the first page of your insurance package.
  • Policy limits: This is the maximum amount of money that can be awarded to you in case of damage or loss to property. If your house policy limit is $1,000,000 you are entitled to be paid a damage fee of $1,000,000. Any other property that was inside the house is not paid. It is always important to ensure that you are well covered by a policy limit in that you will always recover your losses from the insurance firm.

By having a good policy you will always protect your loved ones and also your property. By this you will live in comfort with the guarantee that should tragedy strike at anytime you are well covered. Any questions that you do not understand should always be asked to your insurance since this save you your home. By being more informed and educated you will be in a position to make the best decisions and know on the kind of policies to take and what they mean to you.