Home is where the heart is. It’s also a huge investment, so make sure to protect it.

If you own a property such as a condominium or an apartment, the developer or building management will buy master insurance to cover all the units.

This insurance is called FIRE INSURANCE.

UNDERSTANDING OF FIRE INSURANCE

The building management will pay a lump sum amount to the insurance company and later break down the amount into individual units and bill it to each unit.

Fire insurance is an annual payment thing, so you only pay once a year.

However, if the property is under an individual title, you have the luxury to choose your own insurance company and buy it your own.

Usually, property fall under the individual title is a terrace house, semi-d, bungalow, shop house, etc.

Strata title property will always fall under the strata management act, where the building management will buy a master fire insurance to cover all units.

Property under strata title is condominium, apartment, townhouse, service apartment, etc.

Sometimes, you will face a scenario where the bank also purchases fire insurance to cover your property.

If the property still has a bank loan, the bank will take the necessary steps to protect the property, which means the bank will buy fire insurance and charge you with the fees.

If the building management and the bank bought for you simultaneously, you would be paying twice for fire insurance, which is overpaid.

So what are you going to do about it?

Well. There is a solution for this.

You can request a copy of the fire insurance from the building management and submit it to the bank.

If the bank has charged the fire insurance premium, you can always ask for a refund.

WHY WE NEED FIRE INSURANCE?

Fire insurance is quite a big deal policy. It covers your house and building against damages caused by fire, lightning, domestic explosion, floods, landslides, etc.

If you want to understand the fire insurance policy’s coverage, you can always ask the building management or the insurance company to give a full copy of the fire insurance.

I’d always make time to read the fire insurance policy every year because it is essential to know its coverage. And also, I care about my properties. And I think you should too.

Did you know?

You can’t buy a fire insurance policy without a completion and compliance certificate (CCC) or Certificate of Fitness (CF).

Completion and compliance certificate is to prove a property is safe to stay and live. Obviously, without these CCC, an insurance company does not feel secure enough to protect and cover the property.

Therefore, you can’t buy fire insurance.

And did you know without a CCC and fire insurance, you can’t get a loan from the bank?

Yeah, shocking!

So, if you decide to take a bank loan from a bank, you might want to consider getting the CCC ready.

Some people bought a piece of land and build their own house; it is impressive!

However, these people rarely apply for a CCC after the house complete.

And if they go to the bank and apply for refinancing, most banks will not keenly finance the house.

But the bank would consider financing the land with a lower margin.

Client story

Five months ago, we had a client who approaches us to do a refinancing.

After giving her our consultation, and recommended her case to some local banks. She applied for a home loan with them.

Eventually, the loan approved, and she signed the Letter Offer with the bank.

After that, the bank will send out an instruction to a valuer firm, and the company will send a valuer to visit and take some photos of her house.

Afterwards, the valuer firm will submit a formal valuation report to the bank.

According to the client, the house renovated with approval, and a completion and compliance certificate (CCC) was issued.

However, that is not the case.

When a valuer asked for a CCC copy, she can’t provide it.

After several conversations, we finally know the truth.

According to the client, she asked her architect to submit the CCC application.

And when the architect told her about the cost of getting CCC, she decided not to proceed. I can’t remember the exact price, but I think a few thousand.

Due to this reason, her case can’t proceed further. Not until the CCC is issued.

To solve this, she has to go back to the architect and submit the CCC application. And she did.

After 2-3 months, she got the CCC, and now her case can move forward again.

The moral of the story, completion and compliance certificate (CCC) is important!

Without it, you might face some challenges when taking a bank loan or even buying fire insurance.

We hope you enjoy these tips about fire insurance, and let us know if you have any questions!

I see you in my next post.

Before you go, check out this article. You might enjoy reading this.

WHICH BANK HOME LOAN IS BEST?

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Melissa Lee

Online Financial Consultant

Call Us: 012-6946746 (talk to Mr David)

Whatsapp Us: https://wa.me/+60126946746

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