You already have fire insurance with your mortgage, so do you still need home insurance?

In most cases, yes.

Mortgage fire insurance primarily protects the structure of your property, while home insurance focuses on household contents, home renovations and third-party legal liability that occupants may incur. The two types of insurance protect different categories and are generally complementary rather than interchangeable.

When trying to decide which policy might cover a specific loss, it is often more useful to identify what has been damaged, rather than focusing solely on whether the incident was caused by fire, burst pipes or a typhoon. Ask yourself this: was the damage to the building structure, renovations, movable belongings, or to another person or their property?

The sections below explain the key differences between home insurance and fire insurance across these four areas of protection.

In Hong Kong, fire insurance commonly refers to building structure insurance. Mortgage lenders typically require mortgaged properties to maintain fire insurance coverage so as to protect the building structure which serves as collateral for the loan. Generally, the building structure may include walls, ceilings, floors, doors, windows and other permanent fixtures. The exact definition, coverage amount and “insured perils” will depend on individual policy terms and lender requirements.

Although it is commonly known as “fire insurance”, coverage may not be limited to fire-related incidents. For example, under the MSIG Mortgage Fire Insurance Plan, basic coverage includes loss or damage to the building caused by fire and lightning. Policyholders may also choose to extend protection against risks such as flooding, explosions, riot, strikes, malicious damage and impact by aircraft or vehicles. Therefore, coverage should not be assumed to based solely on the term “fire insurance”.

In addition, even if your building management company or owners’ corporation has arranged a master building insurance policy, this does not necessarily mean the coverage satisfies your mortgage requirements or fully protects all fixed elements within your unit. A prudent approach is to obtain a coverage summary from the management office and seek confirmation from your mortgage lender to avoid either duplicate coverage or protection gaps.

If a fire blackens internal walls, lightning damages fixed electrical installations, or insured events cause damage to original doors and windows, the claim would typically involve building structure insurance. However, external walls, common areas, and communal pipes may be covered by the building deed, property management responsibilities or a master building insurance policy. Property owners should not assume these losses will automatically be covered under their own fire insurance policy.

MSIG iHome Insurance also offers an optional building cover that protects both the building structure and renovation works carried out after purchase. If you already have mortgage fire insurance or building-wide coverage, compare the scope of protection, coverage limits, deductibles and claims procedures before purchasing additional insurance. The goal should be to fill existing protection gaps rather than simply increasing the number of policies.

Suppose a fire damages both a wall and a television. The wall may be covered by fire insurance, while the television, sofa, clothing and other household belongings would usually be covered by a home insurance policy. Under MSIG iHome Insurance, “all risks” coverage for household contents provides protection of up to HK$1 million, subject to a maximum limit of HK$100,000 per item, set or collection. Water damage protection is also included. Actual compensation remains subject to policy limits, deductibles, exclusions and claims requirements.

Therefore, even if you already maintain mortgage fire insurance, valuable household appliances, furniture, collectibles and personal belongings could remain uninsured. When arranging coverage, estimate the current replacement value of your household contents and consider whether high-value items require a separate declaration.

Home renovations are one of the most common areas where coverage uncertainty arises. Permanent fixtures originally included when the property was purchased may be treated differently from custom-built cabinets, false ceilings, feature walls or other renovation works added later. Definitions can vary between policies.

Instead of simply asking whether home insurance covers renovations, policyholders should carefully review how the policy defines buildings, fixtures, home improvements and renovation works. It is also advisable to retain renovation contracts, invoices and photographs of the completed work to support any future claims.

Imagine a burst pipe in your unit causes water leakage that damages your neighbour’s ceiling and furniture. Alternatively, what if a visitor is injured due to an accident in your home? In such situations, you may face legal liability for the resulting losses. Third-party liability risks are generally not a core component of mortgage fire insurance.

MSIG iHome Insurance provides Personal Liability Cover with a maximum limit of HK$8 million. Whether liability exists, the amount payable and any associated legal defence costs will ultimately depend on the policy terms and the circumstances of the incident.

In some situations, the protection provided by home insurance and fire insurance may overlap. However, this does not mean you can be compensated for the same loss twice. A practical approach is to assess the following 3 steps: “cause of loss → damaged item → relevant policy section”.

1. Fire: Damage to walls, ceilings and other structural elements would typically be reviewed under fire insurance. Damaged televisions, furniture and clothing would generally fall under household contents coverage.
2. Typhoon-related water damage: Whether windows or fixed structures are covered depends on the cause of loss and policy definitions. Water-damaged furniture and electrical appliances may be covered under home insurance provisions relating to flooding or water damage. MSIG iHome Insurance also provides coverage for typhoon-related window glass breakage, with a maximum benefit of HK$10,000.
3. Burst pipes and water leakage: Damage to structural elements of your unit, household contents and losses suffered by neighbours below may involve building coverage, household contents coverage and third-party liability coverage, respectively.

If you are unsure which policy should handle a claim, retain evidence of the incident and the resulting damage, notify the relevant insurers promptly and disclose any other potentially applicable insurance policies. The insurers can then review and coordinate claims according to their respective policy terms. It is important to note that the same compensated loss cannot be claimed more than once.

The risks faced by different occupants vary significantly. As a result, insurance needs differ for owner-occupiers, landlords and tenants.

Owner-occupiers with an outstanding mortgage

For homeowners who live in their property and have a mortgage, fire insurance satisfies lender requirements and covers the building structure.

Home insurance complements this protection by covering household belongings, renovation works, temporary accommodation expenses and personal liability risks. MSIG iHome Insurance also provides water damage protection, temporary accommodation expenses of up to HK$50,000 and other household benefits. Comparing your existing mortgage fire insurance with home insurance can help identify potential coverage gaps.

Landlords

In addition to protecting the building structure, landlords should consider coverage for furniture and appliances belonging to them, rental income loss and liability arising from property ownership. The MSIG Landlord Protector Insurance Plan provides household contents cover of up to HK$400,000, loss of rent cover of up to HK$80,000 or three months’ rent, property owner’s liability cover of up to HK$8 million and optional all risks building cover.

Tenants

Tenants generally do not need mortgage fire insurance because they do not own the building structure. However, a landlord’s fire insurance policy will not automatically protect a tenant’s personal belongings, such as computers, clothing or furniture. It may also not cover third-party liability arising from the tenant’s actions.

The MSIG Tenant Protector Insurance Plan provides household contents coverage based on unit size, home renovation cover of up to HK$50,000, personal liability cover of up to HK$5 million, alternative accommodation protection and security deposit protection.

1. Confirm your mortgage lender’s requirements, including coverage amount and beneficiary arrangements for fire insurance.
2. Obtain details of any master building insurance policy from your management office and request written confirmation of coverage.
3. Assess separately the value of walls, doors, windows, renovations, household contents and your liability exposure.
4. Compare insured perils, deductibles, item limits, exclusions and conditions across different policies.
5. In the event of an incident, prioritise safety, prevent further damage where possible, photograph the affected areas, and retain damaged items, quotations, invoices and repair reports. Notify your insurer within the timeframe specified in the policy.

In summary, mortgage fire insurance primarily protects the building itself, while home insurance helps protect your belongings, renovations and liability exposure arising from everyday living. For most owner-occupiers with mortgages, combining both types of coverage can provide more comprehensive protection. Landlords and tenants should assess their own assets and responsibilities and select coverage accordingly. All coverage, limits, exclusions and benefits are subject to the latest policy terms and conditions.

1. What does fire insurance cover?

   Fire insurance generally covers damage to fixed parts of a building, such as walls, ceilings, floors, doors and windows, resulting from insured events. Although called “fire insurance”, some policies may also cover additional risks. Actual coverage depends on the policy wording.

2. If I already have mortgage fire insurance, do I need home insurance?

   In most cases, yes. Mortgage fire insurance mainly covers the building structure, while home insurance generally protects furniture, appliances, personal belongings, certain renovation works and third-party liability. The two types of protection are complementary.

3. Does home insurance include fire insurance?

   Not necessarily. Home insurance generally focuses on household contents and liability protection. Building structure coverage may not be included automatically, although some plans offer it as an optional benefit.

4. Are renovations covered by fire insurance or home insurance?

   This depends on how the policy defines buildings, fixtures and home improvements. Built-in cabinets, false ceilings and other renovation works may not always be regarded as part of the original building structure. Review your policy wording carefully and retain renovation records and invoices.

5. If my building already has a master insurance policy, do I still need fire insurance?

   Not necessarily. Obtain a copy of the master policy summary and ask your mortgage lender whether it satisfies lending requirements. Also review whether there are gaps relating to fixed fixtures, deductibles or coverage limits.

6. Do tenants need fire insurance?

   Tenants generally do not need mortgage fire insurance for the building structure. However, home insurance can help protect personal belongings, home improvements, temporary accommodation expenses and potential third-party liability.