1. Fire accident is the major casualties for house owner, it has the highest probability of such incident occur to destroy the house than others. Hence, Fire insurance is mandatory for every house owner, whether you want it or not, it is COMPULSORY! Ha
2. When you receive financing from bank, letter offer signed will include a fire insurance purchase agreement in the clauses, hence you know it’s a matter of compulsory when bank finance you the housing loan 😉
3. However, you would need to purchase fire insurance directly from bank. Alternatievly you could purchase your own individual fire insurance from independent company. But you need to submit fire insurance report yearly to the bank, to reassure them fire insurance is actively protecting your property.
It is very troublesome to do so, hence it is best to get from bank. Don’t worry about the price, as fire insurance premium are governed by PIAM & BNM, hence all company offered almost the same protection pricing.
4. For owner owned non landed properties (condo, apartment etc), they aren’t required to purchase fire insurance from the bank. The property management corporation will purchase a Master fire insurance policy for each of the units owner.
The strata title act stipulates that management corporation is responsible to insure the property under a master fire insurance policy. Hence owner will pay the fire insurance fees to the management corporation.
You can head to the management office and request for the master fire insurance policy, before paying for your shares on it.
5. Double insurance on same unit do rarely occurred. Where you purchase fire insurance from the bank and the management corporation having master fire insurance coverage on your unit too. You can kindly request bank to review this matter and request for termination, a pro-rata refund may be granted to the insured by insurer.
6. Last pointer, do take note that fire insurance insured the cost of re-building of your property and not the market value of your property. So the amount payable would be based on the rebuilding cost and added 5-15% estimation of inflation cost of the property.
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