Q:

What is a standard fire insurance policy?

A:

Quick Answer

Standard fire insurance policies provide coverage against financial loss or property damage caused by a fire or other covered perils. The basic version of a fire insurance policy covers the cost of replacement, reconstruction or repair beyond what is outlined in the holder’s property insurance or homeowner’s policy.

 Know More

Full Answer

Standard fire insurance policies provide coverage against damage to the dwelling itself. The policy either reimburses the holder on a replacement cost basis in the event the dwelling is destroyed or an actual cash value basis. Replacement coverage is determined by the issuer based on replacement cost estimators, the most recent property appraisal figure and the property’s square footage compared to its purchase price.

Basic policies protect against a number of perils outside of fire that cause damage, including lightning and hail. Specialized packages also extend coverage to surrounding structures and additional expenses associated with displacement from the dwelling.

Standard fire insurance policies are typically acquired for rental and investment properties that do not require protection against the owner’s personal possessions.

Procuring a fire insurance policy is also recommended if the individual’s property or homeowner’s insurance does not protect against fire damage. Extended protections beyond those outlined in the underlying property or homeowner’s insurance is recommended if the underlying property contains an assortment of valuable items.

Learn more about Insurance

Related Questions

  • Q:

    How do you buy health insurance?

    A:

    To buy health insurance, an individual should first educate himself on the language and concepts pertaining to health insurance, gather estimates for different insurance policies, and figure out if there are any fees or benefit limits for each policy. An individual might also be eligible for a special government program.

    Full Answer >
    Filed Under:
  • Q:

    How can you protect your life insurance policy from Medicaid?

    A:

    Life insurance policies valued above $1,500 may be used by Medicaid in determining eligibility for long-term care coverage, according to LongTermCare.gov. Assets that Medicaid considers should be transferred into other asset types not counted by Medicaid in order to avoid being considered for Medicaid use.

    Full Answer >
    Filed Under:
  • Q:

    What is tail insurance coverage?

    A:

    Tail insurance coverage is a provision within an insurance policy that allows the insured to make claims after a policy has expired for acts that occurred when the policy was valid. A policyholder typically pays extra premiums for tail coverage, which is valid for up to one year.

    Full Answer >
    Filed Under:
  • Q:

    What is a monoline insurance policy?

    A:

    A monoline insurance policy provides interest and principal coverage for securities and bonds when the issuer defaults. Protections against defaults are packaged in the form of credit wraps. These instruments not only provide protection for the buyer, but also bolster the credit of the issuer.

    Full Answer >
    Filed Under:

Explore