A fire insurance policy is not just confined to offering protection against accidental fires. Fire-related damages can occur due to more than just flames and that’s where RSMD cover comes into the scene. RSMD stands for Riot, Strike and Malicious Damage, and it plays an important role in safeguarding properties against unexpected losses caused by human actions.
This blog will break down RSMD coverage details, explaining what it covers, why it is important, how it benefits property owners and what you need to consider before opting for it.
What is RSMD in fire insurance?
RSMD coverage is an extension provided under standard fire insurance policies. It offers protection against losses or damages caused due to:
- Riots: Riots are situations where a group of people engage in violent actions and behave in inhuman ways, causing damage to properties.
- Strikes: Strikes are instances where workers and employees stop performing their duties and protest against the management. Such actions might take an ugly turn, interrupting the business processes and causing losses and damages to property.
- Malicious damage: These damages include intentional destruction caused to insured items or properties by vandalism, arson or other deliberate acts.
Why is RSMD coverage important?
While most of us focus on natural disasters when purchasing fire insurance, it is equally important to consider human-related risks. Here’s why RSMD coverage is essential:
Protection against civil unrest
Riots and strikes are quite common and are a matter of concern, leading to property damage. RSMD coverage ensures financial protection in such cases.
Safeguards against malicious damage
Not all fire-related damage is accidental. Some losses occur due to intentional acts, such as vandalism or arson. This policy safeguards against such threats, ensuring property owners do not have to pay out of pocket for damages caused by criminal activities.
Essential for businesses
For businesses, an interruption caused by property damage due to riots or strikes can lead to loss of revenue. RSMD coverage helps recover losses and resume operations faster, helping business owners to claim compensation and get back on track sooner.
Comprehensive protection
A basic fire insurance policy covers only damages caused by fire. However, fires during riots or strikes may not be covered unless RSMD is included. This makes RSMD a critical addition to any property insurance plan you choose.
What does RSMD cover?
RSMD coverage under fire insurance policies typically includes damage caused by:
- Rioting mobs destroying public and private properties.
- Labour strikes that cause structural damages.
- Vandalism and destruction of assets.
- Deliberate fires (arson) set by individuals or groups.
- Damage to windows, doors, walls and inventory due to protests or social disturbances.
What RSMD does not cover?
While RSMD is a valuable addition to your fire insurance, it does not cover:
- Damage due to war or terrorism.
- Losses caused by nuclear risks.
- Theft or burglary during riots.
- Fire damage unrelated to riots, strikes or vandalism.
- Damage caused by government actions such as demolitions.
- Damage done intentionally by the insured.
Who should opt for RSMD cover in property insurance?
RSMD coverage is beneficial for:
- Homeowners: Protects residential properties from damage due to riots or vandalism.
- Business owners: Ensures commercial properties and stocks are covered against strikes and malicious damage.
- Shopkeepers: Retail stores can suffer losses due to riots or protests.
- Factory owners: Industrial units often face risks due to labour unrest.
- Landlords: Protects rental properties from damage caused by tenants or external disturbances.
Adding RSMD cover to your fire insurance policy ensures comprehensive protection against unforeseen human-induced damages. If you live in an area prone to social unrest or own a business in a politically active region, RSMD cover is highly recommended.
How to claim RSMD in a fire insurance policy?
If your property is damaged due to riots, strikes or malicious activities, here’s how you can file a claim:
Inform the insurer immediately
Report the damage to your insurance provider as soon as possible. Delays in reporting may affect your claim approval.
Gather evidence
Take photos/videos of the damaged property. This will serve as proof while filing the claim.
File an FIR
If required, file a police report to support your claim. This is crucial in cases of vandalism or arson.
Submit required documents
Provide proof of ownership, damage assessment reports and other necessary paperwork.
Inspection by the insurer
The insurance company may send a surveyor to inspect the damages before approving the claim. Cooperate with the team.
Claim settlement
Once evaluated and verified, the insurer will process the claim and provide compensation as per the policy terms.
Cost of RSMD cover in property insurance
The cost of RSMD cover varies based on:
- Location of the property: High-risk areas may have higher premiums.
- Nature of the property: Commercial buildings may have different pricing than residential homes.
- Coverage amount: The higher the insured sum, the more the premium.
- Previous claim history: If an area has frequent riots or strikes, insurers may adjust the pricing accordingly.
Conclusion
RSMD coverage is a crucial part of a fire insurance policy. Whether you are a homeowner or a business owner, ensuring protection against riots, strikes and malicious damage can save you from unexpected financial setbacks. By adding this extension to your property insurance, you secure peace of mind, knowing that your property is protected from human-induced threats.
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