HDB Fire Insurance versus Home Insurance in Singapore: What’s the Difference?

What's the difference between HDB fire insurance and home insurance?

Nothing can be further from the saying “Home is where the heart is”. Our family, our memories, treasures and special belongings are all here - the four walls and a roof we call our home - but do we place the same importance in protecting it?

People tend to think that they are fully covered the moment they buy the house. But in reality, some aspects may be lacking. Not many know the difference between home insurance, fire insurance and home contents insurance, and what they cover.

Key Differences between HDB Fire Insurance and Home Insurance

Home insurance is not the same as Fire insurance. There are a whole lot of differences between the two policies that people are not aware of. Generally, fire insurance compensates for any damages made to the building structure and fittings. This includes the electrical wirings, floorings, and walls that are present even before you owned the house. If your house is burnt down and the walls are damaged, you don’t have to worry about spending on repairs. What this insurance does NOT cover is the movable items inside your home. Such contents include appliances, personal belongings, furniture, and even the renovated fittings, all of which fall under home contents insurance.

A good home insurance will cover both the building structure and the home contents. In other words, it is a combination of fire insurance and home contents insurance.

To give you a better understanding, here’s a quick guide on what each insurance covers.

Component Title

Home Insurance

HDB Fire Insurance

Home Contents (furniture, plants, and appliances)

Yes

No

Fixtures & Fittings

Yes

Yes

Personal Belongings

Yes

No

Renovation Work

Yes

No

Alternative accommodation

Yes

No

Personal Accident

Yes

No

Personal Liability

Yes

No

Additional fixtures and fittings installed

Yes

No

What is HDB Fire Insurance?

Home insurance is an optional benefit for any HDB or private property owner, unlike fire insurance which is mandatory in Singapore. That is why fire insurance is more common to property owners. If you plan to buy an HDB flat using a bank loan, the bank will most likely require you to purchase fire insurance. This policy is called Mortgagee Interest Policy which means that if any damages happen to the property, all insurance payouts go directly to the bank.

No matter how safe we are, accidents do happen and it may not always be due to our negligence. In fact, based on the Singapore Civil Defence Force (SCDF), about 40% of fire occur at residential properties. Although unattended cooking and discarded items in corridors or rubbish chutes are the top two causes for residential fires, SCDF has seen an increase in fires of electrical origin, particularly related to personal mobility devices (PMDs). 

In light of this, it is important that we keep our homes and its contents protected adequately.  Fire insurance only covers the physical structure of your property, which was already present even before you owned the property. Any additions like your built-in wardrobe and kitchen cabinets after the purchase of the house do not fall under fire insurance. Same goes with your home appliances and furniture. 

How much is the Fire Insurance for HDB in Singapore?

Flat Type

5-Year Premium Including the 7% GST

Sum Insured

1-Room

$1.62

$29,000

2-Room

$2.71

$48,700

3-Room

$4.87

$60,400

4-Room/S1

$5.94

$82,000

5-Room/S2

$7.13

$97,300

Executive Flats

$8.10

$106,200

Studio Apartment

$2.71

$48,700

The table above shows the 5-year premiums inclusive of GST for the different types of HDB flats. The HDB Fire Insurance was introduced to property owners in Singapore to relieve any financial burden of repair work in case a fire happens. This insurance is only valid for five years and requires you to renew it subsequently. 

What is Home Insurance?

While HDB fire insurance is mandatory in Singapore, it provides basic cover to your building's structure in the event of a fire. Your expensive renovations, home appliances and home furniture are usually not part of the HDB fire insurance. To have your dream home adequately protected, consider getting a home insurance. The policy is meant to support fire insurance. It basically protects your home, especially the inside, from fire or any common disasters such as water pipe damages or theft. But in this case, you get all the benefits, not the bank.

Certain home insurance plans cover more than just your renovation works, furniture and appliances, and provide additional benefits like accident and hospitalisation insurance for your family members and domestic helper, and personal legal liability in the event your guests gets injured in your home.  

Two Main Types of Home Insurance

There are two kinds of home insurance in Singapore: Insured Perils and All-Risks. Some insurance plans allow you to choose between the two. Let's learn more about them to see which you can benefit from. 

Floods can cause a lot of damages to our properties and destroy the home contents. As much as you try to keep all your special items secured in a safe, they'll be gone in a serious flooding. That's where home insurance comes in. The policy that covers damages caused by these mishaps is called Insured Perils. As for the All-Risks home insurance plan, it covers a broader range of situations which makes it a lot more expensive.

What Does Home Insurance Cover?

Home insurance plans in Singapore may differ between insurance companies, so be sure to check the policy before purchasing one. Here are the common types of protection offered:

  • Home contents: Whether you're living in a house full of items or not, whatever's in your house will be covered by the insurance. These home contents include furniture, appliances (washing machine, TV), and personal possessions like your clothes, art pieces and cash. If these items are damaged or stolen, it is better to report it to your insurance company and they'll take care of it. However, do note that highly prized art pieces or collectibles like your expensive watches may require special insurance.
  • Pets: Not all insurance companies will cover pets. If they do, it will only be applicable for dogs and cats of certain breeds.
  • Renovation Work: If your house got caught in a fire and has created some damages, the policy will compensate for the cost of repairs. If you are living in an HDB flat, the HDB fire insurance will cover for any damages in the original building, including the walls and electrical wirings. But to support any additional renovation work, the policy will cover for the extra charges.
  • Personal Liability: When a fire starts in your house, most likely it may spread and reach your neighbour's property. When this happens, you will be held responsible for any damages made. Personal liability coverage offers to compensate for the damages that you don't intentionally mean to do. The policy can also be useful for tenants as it can cover for the cost from any damages done in the property they are renting.
  • Personal Accident: This policy applies to you, your family and maid. Personal Accident helps to compensate for any medical cost or lump-sum payout in case of accidental death and injury. 
  • Alternative accommodation: When your home becomes uninhabitable due to fire or a major flooding due to a burst pipe, you and your family will need a place to stay. With a home insurance plan, the policy will compensate for the daily expenses as you find alternative accommodation. Take note that this benefit will only last for several days, depending on what your insurance company offers.
  • Personal Belongings: This includes loss of money and valuables in the event of burglary. It may also cover the fradulent use of your ATM and credit/debit cards if the cards were stolen during the burglary. However, there might be a limit to how much you can claim.

Every property owner in Singapore has the choice of whether to purchase a home insurance plan. But in the event the unfortunate happens, you'll be lucky if you have both home and fire insurance since both policies work well together. While fire insurance covers for any damages done in the original structure of the building, home insurance policy will cover for the structure, added fittings and the home contents. 

Contents in home insurance policies may vary depending on whether you are the property owner or you are just a tenant. For homeowners, this policy is important. Everything you own will be covered with the policy. Also, if you plan to have some parts of your house renovated, you should consider getting a more comprehensive home insurance policy. This will cover for any renovation works such as wall painting and floor tiles installation. 

If you are renting a unit where you own most of the contents in the house, you might want to consider purchasing home insurance as it will keep you and your personal possessions covered from certain expenses.

If you're a landlord, purchasing home insurance is a must since you'll be shouldering the cost of any renovation work. The policy will cover for losses and damages to the renovation or repair work done in your property. For instance, your tenant suddenly calls you informing you that the water pipes are leaking. The policy will compensate for any repair work expenses or item replacement as long as it is an insured event and fits the limit. If you are renting out a fully furnished house, this means that most of the contents belong to you. Purchasing home insurance will keep all the items in your home protected in case any damages happen. 

In the unfortunate event of a fire, find out what you should do to submit a home insurance claim.

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