Full theft vs burglary insurance policy

What is the difference between a full theft and a normal burglary insurance policy? The bank misled the lawyer on the insurance policy, assuming she understood all terms, clauses, warranties, and exclusions. This is a common wrong assumption, as the lawyer is not trained in all technical insurance jargon.

Missing Gold Necklace
I recall my brother’s case years ago.

“Jamin, since you’re in insurance, can you help claim your sister-in-law’s gold necklace?”

“How did she lose it?”

“She placed it on her dressing table after a wedding. Returning from breakfast, we found the maid gone and the necklace missing.”

My brother had a theft policy bought from a neighbour, a retired English secondary school teacher. I couldn’t help him, as I had a marine claim that needed finalizing.

The Lawyer’s Case
On my way to the bank, I met my lawyer, MissY.

“Jamin, can you review my burglary policy?”

“Why did you need this insurance?” I asked sarcastically.

She lost $5,000 over two incidents and suspected her staff. There was no forcible entry or CCTV.

“Is it a full theft policy?” I asked.

“What’s that?” she questioned.

“You’re a lawyer, you should know!”

“I don’t understand the jargon. I locked it in my safe.”

What is a full theft policy?

A full theft policy is optional insurance that covers theft, even if there are no signs of forced entry. For example, if a thief uses a duplicate key or tricks you into opening the door, under the insurer’s indemnity policy. It’s not standalone and must be combined with other insurances.

Let’s say you own a store. You leave the door locked, but an employee with a duplicate key steals merchandise. With a full theft policy, you can claim for the stolen items even though there was no break-in evidence.

Full theft vs burglary insurance policy

Full Theft: Optional cover is available for an extra premium. It covers theft without signs of forced entry. For example, if a thief uses a duplicate key or tricks you into opening the door, the insurer will honour your claim. It’s not standalone; you need other insurance with the same insurer.

Normal Burglary: requires signs of forcible entry or exit to claim. For example, if a window or door is broken during the theft, the insurer cannot deny the liability in this case.

A burglary policy is a type of insurance that protects against losses from burglary or break-in incidents. Here are the key features explained in simple terms:

1. Coverage: It covers losses due to theft, burglary, and housebreaking. It includes damage to property during the theft or attempted theft.

2. Claim Requirements: Before you make a claim, there must be evidence of forcible entry or exit. This means there should be signs of breaking in or out, such as broken windows or doors.

3. Exclusions: This policy generally does not cover theft without force, like if someone enters using a duplicate key without breaking in.

4. Additional Coverage: Some policies offer optional covers, such as protection for valuable items like jewellery or electronics, and may include coverage for temporary accommodation if your home is uninhabitable after a burglary.

5. Excess: This is the amount you pay out of pocket before the insurance covers the rest. For example, if your excess is RM 250 and your loss is RM 5,000, the insurance will cover RM 4,750.

Imagine a house owner, Mrs. Lee, who runs a provision store. One night, her store is broken into, and valuable goods are stolen. The thieves break a window to get in. Mrs. Lee has a burglary policy. She reports the incident to the police and provides evidence of the break-in to her insurer. The insurance company then processes her claim, helping her recover the financial loss.

A burglary policy provides peace of mind and financial support, ensuring you can recover from such distressing incidents without bearing the full financial burden.

My brother’s case involved the maid stealing the necklace, and the lawyer’s staff took $5,000. Full theft coverage would cover both events, despite no forced entry.

Excess
An excess of RM250 applies. For example, if the loss is $5,000, the claim amount will be $4,750 after the excess.

How to Claim Full Theft Policy:

1. Report the theft: Immediately report the theft to the police and get a copy of the police report.
2. Notify your insurer: Contact your insurance company immediately and inform them about the theft.
3. Submit a Claim Form: Fill out the claim form provided by your insurer. Include detailed information about the incident.
4. Provide Documentation: Submit the police report, receipts, and other documentation to prove ownership and value of the stolen items.
5. Cooperate with Investigation: Cooperate with the insurance company’s investigation. They may request additional information or documents.
6. Assessment and Settlement: Once the investigation is complete, the insurer will assess the claim and determine the settlement amount. You will receive compensation according to the terms of your policy.

Example: If someone uses a duplicate key to enter your home and steals valuables, you will follow these steps to claim your full theft policy.

How to Claim Normal Burglary Policy:

1. Report the Burglary: Immediately report the burglary to the police and obtain a police report.
2. Contact your insurer: Notify your insurance company about the burglary instantly.
3. Fill Out Claim Form: Complete the claim form with details about the incident and the item stolen or damaged.
4. Submit Evidence: Provide evidence of forcible entry, such as photos of broken windows or doors, and a copy of the police report.
5. Proof of Ownership: Submit receipts, photos, or other documents to prove ownership and value of the stolen or damaged items.
6. Insurance Investigation: The insurance company will investigate the claim and may request additional information.
7. Claim Assessment: The insurer will assess the claim and determine the payout based on the policy terms and the provided evidence.
8. Receive Compensation: When the insurer approves your claim, you will receive the settlement amount to cover the losses.

Example: If your store is broken into through a smashed window and items are stolen, you would follow these steps to claim your normal burglary policy.

In both cases, it’s important to act quickly, provide accurate information, and follow the insurer’s procedures to ensure a smooth claims process.

Please share it with your friend or family member. Sharing is joy doubles. I welcome any suggestions and comments, or you can subscribe to my mailing list.

I was hoping you could email me at [email protected].

Thanks