Fire insurance is one of the most controversial topics when it comes to real estate leasing. It is common for landlords and tenant to have doubts about who should pay it. However, it is important to note that hiring is essential to ensure the protection of property.
The guarantee is to cover damages caused by incidents generated by the fire – whether or not they started inside the residence. Unlike the fire rate, which is mandatory and has the function of assisting fire prevention measures, insurance offers financial assistance in the event of a fire.
This means that the insurer, in addition to sending professionals to solve the problem, offers value for the necessary repairs to be carried out. It is impossible to prevent certain situations, and unfortunately, the residential fire is one of them.
Even if you take every precaution to avoid a domestic accident, the fire can start in the neighboring apartment or at the entrance to the building, for example. The only way to minimally protect yourself from the material damage caused by fire is through fire insurance. Want to better understand the topic? Continue reading this article!
Discover 5 benefits of fire insurance
More relevant than knowing who is going to have to pay the insurance or whether it is mandatory is to understand the importance of the fee – for both the lessee and the lessor. Contrary to what many people think, this is not just a mere bureaucracy, and we are going to explain the main reasons.
1. Protection of common areas
We never know when or how an incident can start. With that in mind, insurance companies develop varied coverages, which even protect common areas of buildings, such as gardens, garages and gateways. This guarantee is usually included in the insurance contract paid by the condominium administration.
The hiring of fire insurance by the administration of the condominium, despite not giving guarantees on the residences of the building, is mandatory. Residents have the right to verify that this is being done correctly with the liquidator or the management company.
2. Security and surveillance
In the event of a claim, that is, if an occurrence provided for in the contract occurs, most companies offer security and asset surveillance. After all, when residents are surprised by fire, they must quickly leave the property and its material possessions.
Unfortunately, this type of protection is important, since malicious people can invade the place in search of good furniture and appliances. In some cases, the resident keeps money and jewelry in his home and these goods are also at risk of being stolen.
Surveillance is also necessary to protect people’s lives. If there is a risk of collapsing, firefighters usually tape the entrances to the condominium with tapes, but it is not uncommon for the residents to ignore the risks and put their lives in danger in order to take some belongings.
Having a professional on-site, guiding and reminding people about these threats, is very important.
3. Refund of covered material goods
In addition to ensuring that no one will take the objects that were not affected by the fire, the insurer can reimburse material goods affected by the fire, such as appliances and furniture, for example. For this to happen, the items must be protected by insurance – information that must be included in the contract.
Therefore, do a research on the differentials of each insurer and choose the one that offers the best cost in relation to the offered benefit. Do not forget to ask the broker about all the possibilities of damage that will be covered by the insurance and to read the contract carefully.
4. Protection of the property
Services that cost much more than the value of taking out insurance, such as electrical, hydraulic and even painting repairs can be offered by the company. If the structure of the house is compromised, insurance also assumes this responsibility and pays accommodation to residents while the problem is resolved.
Again, this will depend on the type of insurance taken out. However, remember that in case of fire, the renovation of the property is necessary. Bearing this cost alone can be very heavy for the individual.
In the case of a rented property, this reform may be the subject of a legal dispute. If the fire was caused by the carelessness of the resident, such as a pot forgotten in the fire, the court can order him to pay for the work, since he was to blame for the incident.
On the other hand, if this problem was caused by faults in the electrical network, the owner must bear the loss of the work and still be responsible for hosting the tenant.
In both cases, hiring a fire insurance would be enough to make the resolution of the facts faster and easier for everyone involved.
Prevention is better than cure, right? Nobody wants to need insurance, but it is very good to know that, in case something happens, a specialized company will provide all the necessary assistance.
It is a situation similar to the auto insurance contract. Knowing that the risks of being involved in a traffic accident or being robbed may occur, the buyer usually prioritizes the contracting of this financial product.
It turns out that a property is also subject to damage and, compared to a car, a house or apartment has much more impact on the individual’s life.
Better understand how fire insurance works
Like any other insurance, there are several coverage plans, and you need to find a broker to find out which one is ideal for each case. To avoid disagreements between owner and tenant, it is important that the choice of the company is made jointly or through a real estate agency. Ideally, the company should be hired before the move, and that the data and documents relating to the hiring should be attached to the lease.
The law stipulates that all home insurance guarantees compensation in case of fire, explosion or lightning. Still, it is worth checking carefully if the legislation is being respected by the insurer.
The cost of insurance varies according to the value and location of the property, in addition to the items that will be covered by it. However, compared to the values of renovations and replacements of lost objects in the event of an incident, the investment is quite low – not to mention that the amount can be divided and paid monthly.
Before signing the contract, it is essential to check what will be covered by the plan and what services are included. Some companies offer locksmiths, electricians, installation of showers and taps, among other services. It is also worth highlighting the importance of checking the reputation of the insurer, after all, in such a difficult time, it is essential to have the help of good professionals.
Many banks offer these services. Therefore, check with your manager what options the institution offers. Starting a search for a company you already work with can be a good idea.
However, do not limit yourself to it – and do not close a deal with the first company you visit. Talking to an insurance broker can make this process easier, since they have extensive knowledge of the market and often have multiple plans for customer analysis.
For those in a hurry to move, this type of partnership can save a lot of time. Who pays the commission to the broker is the insurer and, normally, this amount is already included in the price of the product offered to the customer.
Attention: under no circumstances lie when hiring insurance. Some people end up omitting information in order to demonstrate to the insurer that there will be a low risk of loss. If the company realizes this, the contractor can be accused of fraud or make the insurance payment unfeasible.
Know who should hire and pay insurance
The Tenancy Law, which establishes the rights and duties of the landlord and tenant, regulates the issue of fire insurance. According to her, it is the duty of the property owner to pay the insurance, as long as he does not determine, by means of the lease, that the tenant is responsible for this. Therefore, in order not to be surprised, it is necessary to carefully read all the clauses of the rental agreement.
This loophole in the law, which makes the responsibility for the payment of insurance to fall on whoever is living on the property, is what usually confuses the parties and causes disagreements.
If the rental contract does not require the payment of fire insurance, there is no obligation to hire it. Despite this, as we have seen, insurance is essential to maintain the peace of mind of everyone involved. In addition to ensuring the security and restructuring of the property, the fee also protects and reimburses the assets of those who are living on the premises.
If the parties do not agree on who will pay, insurance is not taken out and a fire occurs, it is very likely that there is no consensus on who should bear the losses. Most of the time, problems like this are solved in court – which takes a lot of time and money for everyone.
An interesting way to avoid this constraint is to seek the intermediation of a real estate company. In this way, real estate market specialists will be able to guide those involved and it is much easier to reach an agreement.