Does Homeowners Insurance Cover Fire Damage?
Homeowners insurance policies reimburse you if a covered peril damages or destroys your home. Standalone fire insurance policies exist too. Here's everything you need to know to be safe.
Is Fire Insurance Included in a Home Insurance Policy?
Yes. Standard homeowners insurance provides coverage for fire damage because fire is one of the named perils listed in an HO-2 policy and is also covered in an HO-3 open perils policy. Your homeowners insurance will cover your home's repair or replacement costs if a fire or smoke damages its structure.
Standard homeowners insurance policies cover fire damages even if they don't address its underlying cause. For instance, standard HO-2 and HO-3 policies won't cover earthquakes or mudslides, but your homeowners insurance does cover perils resulting from the quake. A tremor may damage your kitchen's electrical wires, causing a fire. Although insurance wouldn't cover the structural issues the quake caused, it will cover indirect hazards resulting from it, like fire damage.
How Different Types of Homeowners Insurance Coverage Protects Your Home from Fires
Several home insurance coverages offer protection if fire or smoke damage ruins your home. They include the following:
1. Dwelling Coverage
Insurers use the term "dwelling" to describe your residence. Dwelling coverage is insurance that protects your home's structure and materials. If fire damages or destroys your house, this insurance pays to repair or replace it. You must pay a deductible before your carrier covers any repair costs.
When purchasing a homeowners policy, make sure you have high enough coverage limits to cover material replacement costs and construction.
2. Personal Property Coverage
Some home insurance policies contain personal property coverage options. They pay to replace your damaged personal belongings up to your policy's coverage limit when a blaze destroys your furniture, clothing and other things.
Ask your carrier to raise the limits if you need additional insurance for your things. Insurers typically treat expensive articles differently and set separate coverage limits for them. Some carriers allow policyholders to add additional coverage for valuables, like high-end art and jewelry, under an endorsement or schedule to provide comprehensive protection.
3. Loss of Use Coverage
This insurance will pay for additional living expenses if you can't live in your home due to fire damage. It will pay for temporary relocation costs, like lodging at a hotel or short-term rental. It also pays for meals and other living expenses following the fire. Insurers allot 10 to 30 percent of your dwelling limit for loss of use coverage.
4. Other Structures Coverage
This coverage pays for fire damages caused to your property's detached structures. These include sheds, unattached garages, guest houses, fences and other unattached buildings.
5. Personal Liability Insurance
Most standard homeowners policies include personal liability insurance. This coverage will protect you from litigation that arises from fires on your property. For instance, a neighbor may sue you if a fire in your home ignites a fire and damages theirs.
What Types of Fires are Covered Under Your Homeowners Insurance Policy?
Your home insurance covers several types of blazes, including:
1. Candle Fires
If someone knocks over a candle in your home, your homeowners insurance will cover the resulting fire damage.
2. Electrical Fires
These fires occur due to power surges or short circuits in an electrical system. They spark fires that can destroy your home. Your homeowners insurance may help cover the repairs or replacement costs.
3. Lightning Strikes
Homeowners insurance will cover fires that result from a lightning strike. For instance, lightning may strike a tree causing it to fall, damage your home and cause a fire. It is a named peril under standard homeowners insurance coverage.
4. Kitchen Fires
Homeowners insurance covers damage from kitchen fires and grease fires.
Does Homeowners Insurance Cover Accidental Fires?
Home insurance may cover fires caused by accidents. For instance, a home contractor could accidentally damage an electrical wire, causing it to spark and catch fire. Your homeowners insurance would cover damages resulting from the blaze.
Does Homeowners Insurance Cover Chimney Fires?
Standard home insurance covers accidental fires caused by your chimney, wood stove or fireplace. This insurance doesn't cover fires that result from poor maintenance or negligence issues. To prevent fires, hire a contractor to clear out soot, dust and other flammable materials from your chimney.
Which Fires Aren't Covered by Homeowners Insurance Policies?
Homeowners insurance doesn't cover intentionally caused fires. For instance, if you purposely set fire to your home, your carrier wouldn't cover the damage. Additionally, some insurers prohibit coverage for fire damages in wildfire-prone areas. They also don't cover blazes caused by acts of war.
How Much Fire Protection Coverage Do I Need from my Insurance Company?
Insurers don't have a standard formula to help determine how much fire coverage you'll need as a homeowner. As a rule, the limit you'll need is the maximum your policy will reimburse you after covered losses. You can base limits on factors such as your home and belongings' combined value. Remember these tips while shopping for insurance:
1. Personal Property
You may need higher coverage amounts to replace your personal belongings after a fire. Review your policy. Learn if it offers actual cash value (which reimburses for items' depreciated value) or replacement cost value (which offers money for new ones at modern prices).
2. Dwelling Insurance Tips
Following a fire, the price to rebuild your home may not equal the amount you paid for it. Housing and construction costs change over time. When selecting coverage, ask about the going rates for your home's repairs or replacement costs.
Coverage Limits and Deductibles that Affect Fire Insurance Payouts
Insurance companies will subtract a homeowners insurance deductible from any lump sum settlement payment. Here are some examples:
|Coverage Limit||Combined Home/Property Value||Deductible||Settlement Amount|
Can I Buy Stand-Alone Fire Insurance?
You can. Some insurers provide separate "dwelling fire" insurance policies in addition to their standard coverage. They don't cover as many perils as standard home insurance but include protection from fire, smoke, and explosions. Consider purchasing a standalone fire policy instead of a homeowners policy for older homes or houses with a history of claims to lower your premiums.
You can also buy this coverage for secondary residences, vacation homes or difficult-to-insure properties. Additionally, you can tack on this coverage to a standard policy if your area has frequent forest fires.
What To Do After a Fire
Get a Fire Report
A fire report is an official, public record that's recognized by insurers and the court. While your insurance company will require this document, you are responsible for getting it. Most fire reports will contain the following information:
The time and date of the 911 call
The time and date of the fire units' arrival on the scene
The fire units and ID numbers of the individual personnel that responded
Official incident number
Address of the house
Description of procedures followed and other steps taken
Final disposition of the site
You can get a copy of the report in person, by mail or online from your local fire department or the fire marshal. To find the contact information of your state marshal, go to the National Association of State Fire Marshals' website (firemarshals.org).
Get a Fire Investigation Report
An initial fire report is not the same as a report that's filed after an official fire investigation. Indeed, an investigation may be required if the fire has resulted in a major injury or death, a high dollar-amount loss, fire-related felony violations of the penal code or the municipality's possible exposure to liability. The fire investigation report will include information that's not found in the initial report:
Estimated losses quote
Type of building
Factors, including possible human agency, for how the fire got started
Presence of any smoke detectors
Your insurance company will want this document. If your fire department doesn't have a fire investigation unit, you could appeal to the state, hire a licensed independent investigator or just rely on the initial fire report.
Returning to Your Home After a Fire
To avoid break-ins, alert your local police department that your residence is vacant and vulnerable. For example, in putting out the flames, the firefighters may have broken windows and cut holes into the roof and walls.
Just because your homeowners policy covers your domicile's structure does not mean you can or should enter your structure after a fiery event. In fact, no one should enter their residence unless the fire department says it is safe to do so. Usually, the fire department will make sure your water, electricity and gas are secure and safe before allowing you to enter.
When returning to your home, there may still be threats that have been unnoticed, overlooked or a non-threat till recently. Here are some danger items to look out for:
Smoke or embers
The smell or hissing of gas
Loose power lines
Cracks in the foundation
Snakes, possum, raccoons, spiders and other animals
Frayed or severed wires
If you see these warning signs, a professional investigation is in order.
Wear eye protection and a mask, avoiding breathing in dust, smoke particles and other harmful chemicals. Disconnect and check all appliances before use.
Compare Fire Coverage, Save on Homeowners Insurance
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