Meaning of Fire Insurance

The term fire in a fire insurance is interpreted in the literal and popular sense. There is fire when something burns. In other words fire means visible flames or actual ignition.

Simmering/ smoldering is not considered fire in Fire Insurance. Fire produces heat and light but either of them alone is not fire. Lightening is not a fire but if it ignites something, the damage may be due to fire.

Under section 2(6A) Insurance Act 1938, the fire insurance business is defined as follows: “Fire insurance business means the business of effecting, otherwise than independently to some other class of business, contracts of insurance against loss by or incidental to fire or other occurrence customarily included among the risks insured against in fire insurance policies”.

Example: The following are the items which can be burnt/ damaged through fire:

• Buildings
• Electrical installation in buildings
• Contents of buildings such as machinery, plant and equipments, accessories, etc.
• Goods (raw materials, in–process, semi–finished, finished, packing materials, etc.) in factories, godowns etc.
• Goods in the open
• Furniture, fixture and fittings
• Pipelines (including contents) located inside or outside the compound, etc.

The owner of abovementioned properties can insure against fire damage through fire insurance policy which provides

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