Fire Insurance

Fire Insurance is likely part and parcel of our home ownership plans. I tried to look up some statistics published by the Singapore Civil Defence Force (SCDF) and it shows that about 3056 fire incidents occurred in residential properties in the year 2005. This may seem low compared to the 1.1 million homes in Singapore in that same year (probability is 0.028%), but are we willing to take that risk?

There are different policies available depending on your dwelling type:
1. Landed property
2. Private apartment (strata titled) (leasehold)
3. Private apartment (non-strata titled) (freehold)
4. Housing Development Board (HDB)

This is a general fire insurance guide for residential properties published by the General Insurance Association of Singapore that you might take a look.

As the majority of Singaporeans (>90%) reside in HDB apartments, it is important to understand what is the coverage of our policy. Most purchases from HDB comes packaged with a HDB Fire Insurance, which is very cost competitive. The premium I paid a few years ago was only about S$9 for 5 years and the sum insured was about S$47k. I thought this was very good value for money until I realised that it only covered structure, fixtures and fittings provided by the HDB.

This means it doesn't cover any of your personal belongings inside the apartment (furniture, renovations, etc). Also, if your unit catches fire and causes damages to your neighbouring apartments, you have to pay them damages (no third party liability). I have been pushing back plans to buy extra fire insurance because I had considered our home to be relatively new, as I had this conception that older units that have ageing electrical wirings, apartment design and conditions are more prone to fire incidents. I think I have to re-evaluate my options now that our home is not so "new" anymore, and the extra premiums seems reasonable.

Any good suggestions?