All residential property owners normally will have a fire insurance to protect the property in the case of a fire. This is especially so when the property is charged to the financial institution where the bank will want to ensure that its financial interest in the property is protected in the case of a fire. The basic fire insurance covers the property should it be destroyed by the fire or lightning whereas the houseowner insurance, a more comprehensive fire insurance is packaged to cover other perils such as explosion, impact damage and bursting and overflowing of domestic water tanks and apparatus and others.
Notwithstanding which fire policy the property owner purchased, he can extend it to cover the subsidence and landslide peril by payment of an additional premium. The rate for the standard cover for this peril is at 0.081% of the sum insured. The following is the endorsement wordings of the peril from the Fire Tariff which is governed by the General Insurance Association of Malaysia (PIAM):
In consideration of an additional premium, the Company hereby agree and declare that the insurance under this Policy shall extend to cover loss or damage to the property insured caused by subsidence and / or heave of the site on which the buildings stand or land belonging thereto, or landslip excluding:-
loss or damage to swimming pools, terraces, patios, drives, footpaths, walls, gates or fences unless the building, its outbuildings or garages are damaged by the same cause and at the same time.
Loss or damage to or resulting from movement of solid floor slabs unless the foundation beneath the external walls of the Buildings are damaged by the same cause and at the same time.
Loss or damage occasioned by happening through, or in consequence of
coastal or river erosion.
demolition, structural alteration or structural repair.
defective design or inadequate construction of foundations.
in respect of each and every loss, 5% of the total sum insured or RM25,000.00 whichever is the lower, as ascertained after the application of any condition of average.
Provided that the total liability of the Company shall not exceed the sum insured by each item on the property less the amount excluded under (d) above.
Provided always that all the conditions of the Policy (except in so far as they may be hereby expressly varied) shall apply as if they had been incorporated herein and for the purpose hereof any loss or damage as aforesaid shall be deemed to be loss or damaged by fire.
Subject otherwise to the terms and conditions of the policy.
One may also delete exclusion (a) under the standard cover by nominating a separate sum insured on the properties insured. A loading of 25% on the subsidence and landslip rate is calculated on the sum insured for the properties nominated. We shall give an example to illustrate the above:
A bungalow unit need a rebuilding cost of RM1,000,000.00 for the main building and a rebuilding cost of RM250,000.00 for the outbuildings including the swimming pool, terraces, drive, footpaths, walls, gates and fences.
To purchase the standard cover of the subsidence and landslip peril, take the total sum insured and multiply it with the standard cover rate. The additional premium payable will be RM 1,012.50 (RM1,250,000.00 x 0.081%). For the deletion of exclusion (a) under the standard cover, the premium payable for the peril will be RM 1,063.13 [(RM1,000,000.00 x 0.081%) + (RM250,000.00 x 0.10125%)].
FLOOD COVER FOR COMPREHENSIVE PRIVATE CAR INSURANCE
Do you know that your comprehensive private car insurance does not automatically cover perils such as flood, storm, landslide, landslip and other convulsion of nature? One most common occurrence of such perils is flood. Whenever there is a downpour at a flood prone area, car owners are always concern that their vehicles will be subjected to massive damage if the vehicles get flooded.
Should you need such cover, you may extend your insurance policy to cover the extra benefit by payment of an additional premium. The endorsement wording for the perils is as follows:
Inclusion of Special Perils In consideration of the payment of additional premium by you to us the following peril(s) is/are deemed to be covered under Section A of this Policy:
Flood, Typhoon, Hurricane, Storm, Volcanic Eruption, Earthquake, Landslide, Landslip or Other Convulsion of Nature
Subject otherwise to the Terms of this Policy.
There are two sections in your Policy. Section A refers to "Loss or Damage to Your Vehicle". The premium payable for the extra benefit is 0.5% of the sum insured of your vehicle for each year or part of a year. For example, if you are going to insure your car for a sum insured of RM50,000 and would like to extend to cover the special perils, the additional premium payable for this extra benefit is RM250 for one year. If you buy this cover midway when your policy is in force, you will still need to pay RM250 as prorate will not be applicable for the premium.
With this additional benefit, you will have better peace of mind every time it starts to rain.