By increasing the business area and scope unacceptable accident is also increasing. So reducing the risk of assets, fire insurance takes vital roles. For the different kind of risk, fire insurance or policy also formed in many ways. The main forms or classification of fire insurance are given below.
1. Valued policy:- The policy where the assets price are fixed is called valued policy. Generally valuable jewelry, painting, furniture are insured under the valued policy. The main benefits of valued policy is that if the fire hampered a part of the assets then the insurance holder get the full payment of the assets.
2. Undervalue policy:- This policy is the reverse of the valued policy. That means the policy where the assets price are not fixed is called undervalued policy. Here the assets price is valued under the market price of the damaged assets.
3. Average policy:- The insurance contract where the average policy under the insurance act is followed is called the average policy. The formula of Average policy is:
Insurance Claim= (Sum Insured value of the damaged subject matter)/ Actual value of subject matter insured.
4. Specific policy:- The insurance policy where a assets is insured for fixed time and fixed amount of money it’s may call specific policy. In this policy the damages value doesn’t matter, the policy holder gets the fixed amount of money that he contract with the insurer.
5. Floating policy:- When the product of the insurance holder is in different places but the owner is same, then the policy is taken is called floating policy. The insurer selects the premium of different places of product places product then adding the whole premium and averages this premium.
6. Declaration policy:- In this policy the insurance holder insure his highest amount of finished goods sold and they have to pay 75% of the premium in advance. Then he has to declare the price of finished goods in every next month.
7. Adjustable policy:- In this policy the insurance holder have to insured his finished goods in the actual amount of finished goods. The premium is fixed that amount of finished goods and insurance holder has to pay the premium when the contract is formed. If the finished goods amount is increase or decrease the insurance holder must inform the insurer and adjust the premium.
8. Maximum value with Discount policy:- To reduce the problem of declarable and adjustable policy this kind of insurance policy are formed. In this policy in a year highest amount of finished goods are insured and the premium have to give, after the end of the year because of the increase or decrease of the finished goods insurance holder get the one third of the premium as a discount.
9. Replacement policy:- In which contract the insurance holder get the replacement amount of money from the insurer if the insured product is damaged fully or partly, this kind of policy called the replacement policy. It is also called the “New lamp for the old policy”.
10. Loss of profit policy/Consequential loss insurance:- This type of policy of fire insurance formed recently. Businessman fall in loss by the fire accident because of his assets may damage by fire. That is why his business can be stopped. To reduce this kind of loss businessman can insured in an insurance company.
11. Combined Comprehensive policy:- the policy where all the risk such as: fire, loads hiding, thief, disappointed of the worker, strike etc. are insured by the insurer is called combined comprehensive policy It is also called “all in policy’. Here insurance holder has to pay the large amount of premium.
Above fire insurance policies are seen in everywhere. But because of the distance of time and future demand and the character of the firm, new fire policy may come