Should You Get Fire Insurance?
Few people realize the importance of getting their homes insured for fire incidents until actual damage occurs.
Just recently, wildfires that ravaged the western part of the country have cost thousands, if not millions, of dollars in damage while displacing thousands of residents from their homes.
Fueled by the global rise in temperature, wildfire occurrences are expected to get worse, perhaps even affecting whole economies and permanently displacing people from places they’ve considered homes all their lives.
The facts surrounding fire deaths
According to the National Fire Protection Association (NFP), around 78 percent of all fire deaths occur in homes.
Protecting your property from all these threats is a must. But what kind of protection adequately covers for all your needs?
Fire-proof your finances with fire insurance
Secure your property and your finances with fire insurance.
Fire insurance covers for the damage or loss of property due to fire. It is often an additional feature of homeowners insurance, but the policy can be purchased as a stand-alone.
Some individuals also opt for a Dwelling Fire (DP-1) policy which protects you from dangers that you specify, such as lightning or wildfire.
Ensuring that your home is adequately covered
In many cases where fire insurance is tied to a homeowners policy, your coverage will provide you protection from almost any fire-related incident (e.g. volcanic eruption, lightning, wildfire, etc.) unless stated otherwise.
Some policyholders only assume the coverage of their policies, only to get refused after they file a claim because the cause of damage was not covered in the insurance’s terms.
You must make it a must to read the fine print of your coverage and insurance terms to ensure that you are properly protected. Note the exceptions if there are any, and talk with your insurer or broker about specific coverages.
Not all policies are created equal
It is important to keep in mind that the policy that gives you the cash value of the property differs from the policy that gives you the replacement value.
Look into which type of coverage you’d like for your possessions. Most of the time, choosing the replacement value over cash may be more preferable unless you own some expensive jewelry or art. For these, the insurer may have special rules and limitations.
You could not expect to get full compensation for your home unless it is stated and reflected in your policy that current improvements or upgrades have been done to your property.
Fire damage estimates – What you need to know
Losses and damage from a fire incident vary greatly and can range from superficial to catastrophic such as in the case of county-wide wildfires. There are instances when cost cannot be accurately determined due to the scope of the fire. However, most of the time, these damages easily get an estimate.
Estimating the damage caused by fire can be made easier if the homeowner keeps accurate records of his or her possessions. It might seem a bit obsessive compulsive but you will be thankful you did when you’d need them, not just in the event of needing to estimate fire damage but also in other situations that may result to loss of possessions.
You can manually record serial numbers or videotape them and secure your records in a safe and separate location.
Getting fire insurance is a wise choice especially if you’re living in a part of the country known for wildfires. And even if there hasn’t been history of one in your area, there isn’t a guarantee that it will not happen in the future, given the current state of global temperatures. Arguing over whether the issue is real or not is not what we need right now. After all, we can only ignore the facts for so long.