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Archive for the ‘Property’ Category

Boiler Explosion Policy

Posted on: November 8th, 2019 by shiv No Comments

This policy covers:

  • Sudden / accidental explosion, implosion and collapse risks to insured boilers / pressure plants.
  • Insured’s own surrounding property
  • Third party liability arising out of a sudden and unforeseen physical loss of, or damage due to explosion or collapse of the boiler and / or pressure plant.

While Fire Insurance also covers damage to assets from explosions, damage to boiler or pressure plant itself is not covered in the Fire policy. Damage to boiler and pressure plant due to an explosion can only be covered through this policy. The policy provides coverage for all types of boilers and other pressure plants.

Main exclusions in the policy are:

  • Fire and related perils
  • Contractual liability
  • Consequential loss
  • Loss arising from an existing defect
  • War group of perils, Social group of perils
  • Nuclear perils
  • Gross negligence
  • Failure of individual tubes

Deterioration of Stocks (DOS)

Posted on: November 8th, 2019 by shiv No Comments

Stocks kept in cold storages can suffer deterioration following breakdown of the refrigerated machinery. A separate policy called deterioration of stocks (DOS) can be issued to cover damage to the stocks.

Plate Glass Policy

Posted on: November 8th, 2019 by shiv No Comments

The policy provides you with the following benefits:

  • It covers the cost of making good accidental breakage of insured glass by any reason whatever, except those that are specifically excluded
  • It also provides protection for loss or damage to ornamental, embossed, lettered or stained plate or sheet glass

Some of the major exclusions under the policy are:

  • Damage caused by fire, explosion, gas and heat
  • Damage caused by Act of God perils like flood, earthquake, storm etc
  • Damage due to war and nuclear perils, terrorism, riot, strike

These risks are covered under the Fire Policy. The other exclusions are:

  • Loss or damage due to removal, repair or alteration
  • Damage to frames (can be covered if declared and covered separately)
  • Cost of removal or replacement of any fittings or fixtures necessitated for replacing the broken glass
  • Cracked or imperfect glass
  • Any superficial damage or scratching

For the purpose of this policy, Glass is defined as fixed plain glass and mirrors in or on the premises of the Insured where such glass is situated, excluding painting, tinting, embossing or ornamental works on the Glass unless expressly stated in the Schedule and its value included in the Sum Insured.

Glass shall also include frames and framework provided it is expressly stated in the Schedule and its value included in the Sum Insured.

For the purpose of this policy Sum Insured means Sum Insured as mentioned in the policy schedule which is the maximum sum payable as a whole under the policy during the policy period for all the insured perils. Sum Insured shall be on Reinstatement Value basis.

Reinstatement Value means the cost of replacing or reinstating Glass of the same kind or type but not superior to or more expensive than the Glass when insured.

Neon Sign Policy

Posted on: November 8th, 2019 by shiv No Comments

Covers any losses or damage due to accidents, fire and allied perils, riots and strikes to the neon / glow signs.

All Risk Insurance

Posted on: November 8th, 2019 by shiv No Comments

All Risk Insurance cover a wide range of risks. Infact it covers damage to or loss of property due to any reason whatsoever except for those specifically excluded in the policy. This cover is especially suitable for all kinds of portable devices are equipment. Since fire insurance is location specific and portable equipment can move anywhere within certain geographical limits, they cannot be covered under a Fire Insurance policy. An All Risk Insurance policy provides them a comprehensive cover. Hence the following equipment and similar equipment should be covered under am All Risk Insurance:

  • Cameras
  • Laptops
  • Mobile phones
  • Medical Devices
  • Telecom Devices
  • Various kinds of measuring devices and meters
  • High value watches

The main exclusions in the policy are:

  • Wear and tear or depreciation
  • Damage due to moth, vermin, insects, mildew
  • Damage during cleaning, dyeing, restoring or repairing
  • Denting, scratching, or breakage of fragile and brittle substances
  • Mechanical or electrical breakdown
  • War and nuclear perils

Standard Fire & Special Perils Policy (SFSP)

Posted on: November 8th, 2019 by shiv No Comments

The major Property Insurance cover in India is Fire Insurance. Although called Fire Insurance, it is an umbrella insurance policy covering many risks. The risks covered under Fire Insurance, technically named as Standard Fire and Special Perils Policy, are:

Although called Fire Insurance, it is an umbrella insurance policy covering many risks.

The policy is technically named as Standard Fire and Special Perils Policy.

Fire Group Perils

Fire, Lightening, Explosion & Implosion, Forest Fire, Bush Fire

Act of God Perils

Storm, Tempest, Flood, Inundation, Earthquake, Landslide, Rockslide

Social Group Perils

Riot, Strike, Malicious Damage and Terrorism

Miscellaneous Perils

Impact Damage, Aircraft Damage, Bursting and/or overflowing of Water Tanks, Apparatus and Pipes, Missile Testing operations, Leakage from Automatic Sprinkler Installations

The exclusions in the policy are:

This Policy does not cover

The first 5% of each and every claim subject to a minimum of Rs.10,000 in respect of each and every loss arising out of “Act of God perils” such as Lightening, STFI, Subsidence, Landslide and Rock slide covered under the policy

The first Rs.10,000 for each and every loss arising out of other perils in respect of which the Insured is indemnified by this policy. The Excess shall apply per event per insured.

Loss, destruction or damage caused by war, invasion, act of foreign enemy hostilities or war like operations (whether war be declared or not), civil war, mutiny, civil commotion assuming the proportions of or amounting to a popular rising, military rising, rebellion, revolution, insurrection or military or usurped power.

Loss, destruction or damage directly or indirectly caused to the property insured by

  • ionizing radiations or contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel
  • the radioactive toxic, explosives or other hazardous properties of any explosive nuclear assembly or nuclear component thereof

Loss, destruction or damage caused to the insured property by pollution or contamination excluding

  • pollution or contamination which itself results from a peril hereby insured against.
  • any peril hereby insured against which itself results from pollution or contamination

Loss, destruction or damage to bullion or unset precious stones, any curios or works of art for an amount exceeding Rs. 10000/-, manuscripts, plans, drawings, securities, obligations or documents of any kind, stamps, coins or paper money, cheques, books of accounts or other business books, computer systems records, explosives unless otherwise expressly stated in the policy.

Loss, destruction or damage to the stocks in Cold Storage premises caused by change of temperature.

Loss, destruction or damage to any electrical machine, apparatus, fixture, or fitting arising from or occasioned by over-running, excessive pressure, short circuiting, arcing, self heating or leakage of electricity from whatever cause (lightning included) provided that this exclusion shall apply only to the particular electrical machine, apparatus, fixture or fitting so affected and not to other machines, apparatus, fixtures or fittings which may be destroyed or damaged by fire so set up.

Expenses necessarily incurred on (i) Architects, Surveyors and Consulting Engineer’s Fees and (ii) Debris Removal by the Insured following a loss, destruction or damage to the Property insured by an insured peril in excess of 3% and 1% of the claim amount respectively.

Loss of earnings, loss by delay, loss of market or other consequential or indirect loss or damage of any kind or description whatsoever.

Loss or damage by spoilage resulting from the retardation or interruption or cessation of any process or operation caused by operation of any of the perils covered.

Loss by theft during or after the occurrence of any insured peril except as provided under Riot, Strike, Malicious and Terrorism Damage cover.

Any Loss or damage occasioned by or through or in consequence directly or indirectly due to earthquake, Volcanic eruption or other convulsions of nature.

Loss or damage to property insured if removed to any building or place other than in which it is herein stated to be insured, except machinery and equipment temporarily removed for repairs, cleaning, renovation or other similar purposes for a period not exceeding 60 days.

Burglary Insurance

Posted on: November 8th, 2019 by shiv No Comments

Coverage

The policy covers loss or damage caused by Burglary following upon an actual forcible and violent entry of and / or exit from the premises

Burglary Insurance policy covers property contained in business premises like furniture, fixtures, fittings, office equipment, electronic equipment, stocks owned, or for which insured is responsible or held in trust and/or commission. It can also cover cash, valuables, securities kept in a locked safe or cash box in locked steel cupboard if specifically mentioned.

The policy covers loss or damage caused by Burglary and Theft following upon an actual forcible and violent entry of and / or exit from the premises and Robbery. It also covers damage to your premises caused by burglars during burglary or attempts at burglary.

The Policy pays actual loss/damage to your insured property caused by burglary subject to the limit of Sum Insured. If Sum Insured is not adequate, Policy pays only proportionate loss.

There is also a provision in the Policy to cover bulk items on ‘first loss’ basis wherein a percentage of total stock stored can be taken as that exposed to the risk of burglary and housebreaking. The premium is charged on this percentage selected only. Policies can be issued on declaration basis and on floater basis for stocks

Extensions3

  • Loss of the insured property to cover burglary as a result of riot & strike risks
  • Theft and larceny not accompanied by violent ingress or exit
  • Costs for changing locks and cost for repair of damage caused to the insured premises after an insured event up to 10 % of the total sum insured.
  • Expenses towards restoring paper files, plans, records and drawings, data and installation costs for computer programs
  • Expenses towards clearance of debris, movement and protection thereof (normally up to 10 % of the loss subject to a maximum of Rs 10,000/-)
  • Loss or damage to the properties of the employees
  • Death or injury to employees during a burglary or attempted burglary

The Policy does not cover loss or damage arising from

  • War and warlike operation, Riot & strike, civil commotion, Terrorist activities conclusion of nature and / or Consequential loss by use of the keys to the safe unless obtained by force or threat
  • Any inmate or member of the Insured’s household or his business staff or any other person lawfully in the premises
  • Ionizing radiation or contamination by radioactivity
  • Nuclear weapons material
  • goods held in trust/commission, jewelry, curios, title deeds, business books unless specifically insured.
  • By abstraction from a safe using a key or duplicate key, unless it is obtained by violence or threat
  • Due to shop lifting, acts involving you/your family members/ your employees
  • The extension does not cover losses detected during routine stock taking/ checking.

Machinery Breakdown Insurance

Posted on: November 8th, 2019 by shiv No Comments

Suitability

This policy is suitable for every industry which operates on machines and for whom breakdown of plant and machinery is of serious consequence. Monetary costs involved for restoration of machine to its original state are covered by the machinery (breakdown) insurance policy.

Salient Features

The policy offers cover against loss or damage to the plant and machinery due to sudden and unforeseen reasons whilst the machinery is at work or at rest caused by:

  • Faulty material, design, construction or erection.
  • Vibration, mal-adjustment, mal-alignment
  • Defective lubrication, loosening of parts, stress, molecular fatigue, heating, centrifugal force, explosion/implosion.
  • Electrical faults and failures.
  • Failure of connected machinery or protective devices.
  • Lack of skill/carelessness of the operators.
  • Falling, impact, collision and the like
  • Obstruction or entry of foreign bodies into the machine

Extra Covers

Additional expenses required to repair & restore the damaged machinery like overtime, express freight, surrounding property, third party liability, additional customs duty, air freight can be covered on payment of necessary additional premium.

Benefits

In case of partial loss, all expenses necessary for restoration of the affected machinery will be paid to the extent insured in the policy. Claims will be paid in full provided the machine is adequately insured. Depreciation is not applied except for parts with limited life or which are subject to wear and tear. Excess at 1% of sum insured shall be deducted from all claims. Where the repair cost exceeds the cost of the machine, loss will be dealt on ‘total loss basis ‘ i.e claim will be settled for the depreciated cost of the machine as on the date of loss.

Premium

Premium is charged on the reinstatement value of individual machinery. The machine as a whole should be insured. Premium rates depend on the type of machine; the industry in which it is used and its value. Discounts are offered based on factors such as stand-by facilities, spares available and claims experience provided the value of all machinery at a particular location exceeds Rs.10 crores.

Requirements

A duly filled in proposal form along with a schedule giving full details of the machinery required to be insured along with its reinstatement value is necessary. All the machinery should be in good working condition at the time of taking insurance. Selection of critical equipment is permitted but the machine needs to be insured as a whole.

Electronic Equipment Policy

Posted on: November 8th, 2019 by shiv No Comments

This policy covers entire range of Electronic Equipments from a Personal Computer to sophisticated servers and routers. However the policy does not cover mobile electronic equipment like laptops, digital cameras etc

SECTION I – Covers any unforeseen and sudden physical loss or damage to Electronic Equipment’s from any cause, other than those excluded.

SECTION II – Covers External Data Media and the expenses for reconstruction and re-recording of information

SECTION III – Covers Increased Cost of Working

General Exclusions

  • Acts of Terrorism
  • War and Nuclear Risk
  • Wilful Act or Negligence
  • Partial or Total Cessation of Work
  • Loss or damage to the property falling under the terms of the Maintenance Agreement.
  • Loss or destruction or damage directly occasioned by pressure wave caused by aircraft and other aerial devices
  • Consequential Losses
  • Normal wear & tear
  • Gradual deterioration due to atmospheric conditions
  • Loss or damage due to faulty design
  • Contractual liabilities
  • Cost of replacement / repair or rectification of defective material and/or workmanship

Exclusions to Section II

Costs arising from false programming, punching, labeling or inserting, inadvertent canceling of information or discarding of data media, and from loss of information caused by magnetic fields

Industrial All-Risk Policy (IAR) Policy

Posted on: November 8th, 2019 by shiv No Comments

Industrial All Risk Insurance is a comprehensive policy to cover damage to all types of fixed assets from all unforeseen circumstances except for those defined in “Exclusions”. The Policy also compensates for any loss of revenue or profits following a physical damage to the fixed assets. The risks generally included in the policy are:

  • Fire
  • Explosions
  • Natural Calamities like floods, storms of all kinds, Earthquake, Landslides, Rockslides, Land Subsidence
  • Riot & Strikes
  • Malicious Damages
  • Machinery Breakdown
  • Boiler Explosion
  • Breakdown of electronic equipment
  • Loss of revenue due to any of the risks mentioned above

Property not covered under the policy includes:

  • Money cheque, stamps, bonds, credit cards, securities of any description, Jewelry, precious stones
  • Vehicles licensed for road use;
  • Property in transit other than within the premises specified in the Schedule;
  • Property or structures in course of demolition, construction or erection and materials or supplies in connection therewith;
  • Land, driveways, pavements, roads, runways, railway, etc.
  • Livestock, growing crops or trees;
  • Property undergoing alteration/repair/testing, installation or servicing, undergoing any process;
  • Damage to property being insured by any marine policy.

This policy also does not cover damage to the property insured caused by:

  • Faulty or defective design materials or workmanship inherent vice latent;
  • Interruption of the water supply, gas, electricity or fuel systems;
  • Collapse or cracking of buildings;
  • Corrosion, rust extremes or changes in temperature, dampness, dryness, wet or dry rot fungus, shrinkage, evaporation, loss of weight pollution;
  • Acts of fraud or dishonesty;
  • Coastal or river erosion;
  • Willful act/negligence;
  • Cessation of work delay or loss of market or any other consequential or indirect loss;
  • War and nuclear perils.


Optima’s core group has more than 100 man-years of experience in insurance. Our experience has trained us in reading the fine print of insurance policies, understanding it and applying it for the benefit of our clients.

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