BEST FIRE & HOME INSURANCE POLICIES (UPDATED MARCH 2024)

What is fire and home insurance?

Home insurance covers losses and damages to your property, furnishings and other belongings in the home. It typically includes liability protection for incidents occurring on the property.

Fire insurance is a subset of home insurance, and provides less comprehensive coverage for your property.

Key differences between fire and comprehensive home insurance

While both types of policies may appear to offer similar protections, fire insurance typically offers a more basic coverage limited to damages caused by fire to both interior and exterior structures. On the other hand, home insurance provides a broader range of coverage, extending to personal belongings and home renovations.

For HDB owners who have a mortgage loan with HDB, fire insurance is mandatory. However, for those residing in private properties, it is optional. Owners of private condominiums typically rely on their apartment block’s management to provide a master fire insurance plan covering the buildings.

What is fire and home insurance?

Home insurance covers losses and damages to your property, furnishings and other belongings in the home. It typically includes liability protection for incidents occurring on the property.

Fire insurance is a subset of home insurance, and provides less comprehensive coverage for your property.

Key differences between fire and comprehensive home insurance

While both types of policies may appear to offer similar protections, fire insurance typically offers a more basic coverage limited to damages caused by fire to both interior and exterior structures. On the other hand, home insurance provides a broader range of coverage, extending to personal belongings and home renovations.

For HDB owners who have a mortgage loan with HDB, fire insurance is mandatory. However, for those residing in private properties, it is optional. Owners of private condominiums typically rely on their apartment block’s management to provide a master fire insurance plan covering the buildings.

There were 1,954 fires in 2023, an 8.6 per cent increase 2022

The top two causes were electrical fires and cooking accidents.

Source: The Straits Times

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How does home insurance work?

There are 3 main types of home insurance:

Types of home insurance
What it covers
Levels of coverage
Fire onlyInsured perilsAll risks
Basic HDB fire insuranceThe building and wall structures or pillars provided by HDB or an approved developer ✅  
Home contents insuranceRenovation costs, fixtures and fittings, and items you own, such as your TV and sofa   
Comprehensive home insuranceCovers both building and wall structures, and renovation costs, fixtures and fittings, and items you own   

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Comprehensive third party liability: MSIG Enhanced HomePlus
Comprehensive coverage for luxury items: Chubb Masterpiece Home
Supplementary benefit – accidental death or theft of pet: Income Home
Supplementary benefit – handyman assistance: Income Home
Low cost: FWD Home insurance for HDB, MSIG for private properties

 

Key differences between HDB fire insurance and comprehensive home insurance for HDBs

Flat owners with existing HDB loans commencing on or after 1 September 1994 must be insured under the HDB fire insurance. The current appointed insurer for the HDB Fire Insurance Scheme is FWD Singapore Pte Ltd. Here’s a breakdown on how it differs to a comprehensive home insurance:

Clause / TermFWD fire insurance
Comprehensive home insurance
Building structureCost of reinstating damaged internal structures, fixtures, as well as areas built and provided by HDBCovered
RenovationNot coveredCovered
Contents e.g. furnituresNot coveredCovered
Perils coveredFire only
Option to cover limited perils such a fire, flood, explosions or to cover all risks
Third party personal liabilityNot coveredCovered
PremiumLowerHigher
4-room flat premium$6.05 for 5 years
Sum assured: $82,000
From $375 for 5 years onwards

Source: HDB

You may buy additional home insurance to extend further protection over items in your home that are not covered under the HDB fire insurance. You can get the additional coverage from a separate insurance policy of your choice.

Key terms in fire and home insurance you should know

Insured perils vs. all risk

Comprehensive home insurance offers two primary levels of coverage: insured perils and all risk.

Insured peril policies safeguard policyholders against specific risks explicitly listed in the policy, such as fire, theft, or water damage. In contrast, “all risk” policies offer broader coverage, protecting against a wider range of perils unless explicitly excluded from the policy.

Third party liability coverage

Third party liability coverage protects you or your family members if you’re found legally responsible for inadvertently injuring someone or causing loss or damage to someone else’s property. 

This coverage includes bearing the legal costs and expenses associated with representing or defending you or your family member.

For instance, if a kitchen fire spreads to your neighbour’s unit resulting in damage to their property, this coverage would come into effect.

Renovations, fixtures and fittings

This refers to enhancements and modifications made by either yourself or any previous owners. Examples of such improvements may include flooring, built-in wardrobes, air-conditioners and kitchen cabinets.

Home contents

Home contents means any physical and movable household items or personal belongings including money and valuables kept within the premises that belong to you or your family members.

$213,000

The estimated cost to repair a 4-bedroom HDB after a fire.

Source: Sompo’s reinstatement calculator

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Dangers of under-insuring your property

It’s important to get covered for adequate amounts. If the property is under-insured, the insurer will work out the percentage covered. This figure is based on the difference between the benefit limits as listed in your schedule, and the total actual replacement cost of your building, renovations or contents at the time of the loss or damage.

Here’s an example based on Income’s Home insurance plan:

Insured amount

  • Benefit limit of building and renovations shown in your schedule: $200,000
  • Benefit limit of contents cover shown in schedule: $10,000

Actual cost of damage

  • Full and actual replacement cost of building, renovations at the time of loss: $500,000
  • Full and actual replacement cost of contents at the time of loss: $50,000

Computation of insurance coverage in percentage:

  • Your share of insurance for building and renovations is 60% ($300,000/$500,000)
  • Your share of insurance for contents is 80% ($40,000/$50,000) 

This will result in you bearing 61% of the repair costs.

Example 2: If there is a loss of or damage to the building or renovations at $100,000 and to the contents at $20,000, you will be responsible for paying:

  • $60,000 (60% of $100,000) to repair, replace or reinstate the building or renovations and
  • $16,000 (80% of $20,000) to repair or replace your contents.

The insurer will only pay $40,000 to repair, replace or reinstate the building or renovations and $4,000 to repair or replace the contents.

 

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Factors to consider when deciding on the best home insurance

Protect valuables

You may want to extend your coverage to valuables kept in your home. This may include precious artworks, luxury bags, jewellery or even cash.

Mortgagee requirements

Some lenders may accept fire insurance, while others may insist on a more comprehensive home insurance policy. Check with your mortgage lender to understand their specific requirements.

Tenancy risk and tenant’s liability

If you are a landlord, limit your liability that can arise from your tenant’s injuries. For example, a loose shower screen that shatters causing hurt to your tenant and the resulting cost of medical attention or other compensation.

Older properties

If you live in older properties, there are higher chances of water leakage, and even electrical fires. With higher odds of such incidents happening, home insurance becomes more of an essential.

Worldwide personal liability

This is protection for you and your family if there is accidental damage, injury or death caused to third parties. An example could be a kitchen fire that started in your home and causes damage to your neighbours’ homes.

Other additional benefits

Different insurance companies also offer a range of other benefits — protection against theft, fixed glass breaking accidentally, debris removal, home quarantine allowance and the cost of temporary accommodation, to name a few.

Having an an emergency hotline you can call for help in times of emergency can be a source of security. Some plans even provide you with access to a handyman or a locksmith if you forget your keys by mistake. 

Read more: Home Insurance: What To Consider and How To Know Which To Choose

 

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