Summary of Techniques for Buying Fire Insurance for Homes and Restaurants: Coverage for Fire, Floods, and Various Claims

After a major fire occurred in the Ladprao area, many people have turned their attention to "fire insurance." However, how to choose a policy that comprehensively covers risks and truly allows claims when unexpected incidents happen? Thairath Money has summarized the key information here.

Understanding Fire Insurance

Although the name 'fire insurance' may lead many to believe it only covers fire damage, in reality it includes several other risks such as:

• Fire, lightning strikes, explosions, and damage caused by electrical appliances short-circuiting due to lightning.
• Water-related damages, including leaks, pipe overflows, and rainwater entering the house.
• Risks from vehicles, aircraft, and objects falling from the sky.
• Natural disasters such as storms, floods, earthquakes, and hail.

Naturally, when damage occurs, fire insurance typically covers "property" such as buildings, garages, furniture, or belongings inside the insured premises. Additional coverage can be purchased, for example, third-party liability. Fire insurance can be bought to protect a home, business, factory, etc., depending on the insured party.

Common reasons why claims are not fully paid

When unexpected incidents happen, many assume that having insurance means they can claim the full amount of damages. However, there are several reasons why policyholders might not receive 100% of their claim, including:

• Using the property for an unintended purpose, such as buying insurance for a residence but operating a restaurant or storing inventory there. In such cases, claims may be denied.
• Having an insured amount lower than the actual value. Many choose low coverage limits to save on premiums, resulting in smaller claim payments than expected. Fire insurance policies often specify clear coverage limits per category; for example, natural disaster coverage might be capped at 20,000 baht. To increase coverage, a separate policy must be purchased.
• Exclusions in the policy. This is a critical point buyers must carefully read, as some policies may not cover valuable assets like cash or gold. Detailed review before purchase is essential.

Checklist for buying "home" insurance

For residential homes, although many policy options are available, it is important to choose one suitable for your needs and offers comprehensive coverage. Key considerations include:

• Appropriate insured amount reflecting the risk and asset value. Initially, you may use an existing property appraisal or utilize a calculation tool from the Office of Insurance Commission's website https://smart.oic.or.th/eservice/Menu10
• Check coverage types and limits, such as which natural disasters are covered and the maximum payout allowed.
• Coverage of belongings inside the home. Fire damage affects not only the building but also furniture and electrical appliances. Therefore, confirm if you want coverage for these damages.

What to consider when buying fire insurance for a "restaurant"

Running a business like a restaurant involves various activities and generally higher risks than a residence. Therefore, selecting comprehensive coverage is even more crucial.

• Choose the correct policy type, clearly specifying it covers a restaurant establishment. Do not use a residential policy. Although premiums may be higher, in the event of a claim, coverage will match the risks incurred.
• Coverage for inventory and equipment. Ensure the insured amount includes raw materials, machinery, and all kitchen equipment.
• Third-party liability insurance. Coverage should not only protect property but also address impacts on people, such as accidents occurring to customers or fire spreading damage to others.

Ultimately, before purchasing any insurance, policyholders should assess their needs and risks carefully. Do not forget to thoroughly read policy terms and exclusions to ensure full protection and avoid loss of benefits when unexpected events occur.

Information sources: Office of Insurance Commission (OIC), Thai General Insurance Association.

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