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The Standard Fire and Special Perils Policy covers all properties on land (excluding cost of land), move able or immovable, at various locations against named perils.
Highlights
The Standard Fire and Special Perils Policy covers all properties on land (excluding cost of land), move able or immovable, at various locations against named perils.
Special Types of Policies are designed for Stocks (declaration and floater), Building, Plant & Machinery keeping in mind the nature of property, proposers' requirements and basis of indemnification.
Long Term Policies available for Dwellings with suitable discounts in premium.
Policy can be extended to cover certain additional perils and expenses at additional premium.
Certain perils can be deleted with discount in premium rates.
Discount in premium available for good claims experience for sum insured more than Rs. 50 crores in one location and for installation of fire extinguishing appliances.
Concept of "one risk one rate" for all properties in an Industrial or Manufacturing Complex, for administrative convenience of the proposer.
Scope
Properties that are covered:
All move able/ immovable properties of the proposer on land (excluding those in transit) broadly categorized as follows :
1. Building (including plinth and foundations, if required): Whether completed or in course of construction (excluding the value of land).
Interiors, Partitions and Electricals.
2. Plant & Machinery, Equipment's & Accessories (including foundations, if required)
Bought Second hand
Bought New
Obsolete Machinery
3. Stocks:
Raw Material
Finished Goods
In process
In trade belonging to Wholesaler, Manufacturer and Retailer.
4. Other Contents such as
Furniture, Fixtures and Fittings
Cables, Piping
Spares, Tools and Stores
Household goods etc.
5. Specific Items such as bullion, unset precious stones, curios, work of arts, manuscripts, plans, drawings, securities, obligations or documents, stamps, coins or paper money, cheques, books of accounts, computer system records, explosives.
Special types of Policies available for Stocks:
1. Declaration Policy :
To care care of frequent fluctuations in Stocks/ Stock Values
Minimum Sum Insured Rs. 1 crore per location.
Monthly declaration on any one of the following basis to be submitted before the last day of the succeeding month
1. average of the highest values at risk on each day (or)
2. highest value on any day of the month.
Refund of premium, on expiry of policy, based on the average declaration up to 50% of the provisional premium.
2. Floater Policy :
to take care of frequent changes in values at various locations.
Single sum insured for all the stocks in all the locations.
Nominal premium loading to cover all the stocks in all the locations.
Perils Covered:
Fire
Lightning
Explosion / Implosion
Aircraft damage
Riot, Strike, Malicious damage (hereinafter called RSMD Perils)
Storm, Tempest, Flood, Inundation, Hurricane, Cyclone, Typhoon and Tornado.
Impact by any Rail/ Road vehicle or animal
Subsidence / Landslide including rock slide.
Bursting and / or overflowing of water tanks, apparatus.
Leakage form Automatic Sprinkler Installation.
Missile Testing Operation.
Pollution or contamination resulting from any of the above perils
Any insured peril resulting from pollution and contamination.
Bush Fire
Expenses Covered:
The policy automatically covers the following expenses incurred following loss / damage / destruction of a covered property as a result of the operation of an insured peril.
Architects, Surveyors and Consulting Engineers' Fees up to 3 % of the claim amount.
Expenses incurred for removal of debris to clear the site up to 1 % of the claim amount.
Exclusions Applicable:
1. Losses/ Expenses not covered:
Applicable Deductibles as per policy
Expenses incurred on Architects, Surveyors' Consultant Engineers fees and Debris Removal in excess of 3% and 1% of claim amount respectively.
Loss of earnings, loss by delay, loss of market or other consequential or indirect loss or damage of any kind.
2. Perils not covered:
War and allied perils
Ionizing radiations and contamination by radioactivity
Pollution or Contamination
3. Properties not covered:
Items like manuscripts etc. unless specifically declared.
Cold storage stocks due to change of temperature.
Loss / damage/ destruction of any electrical and/or electronic machine, apparatus, fixture or fitting arising from over running, excessive pressure, short circuiting, arcing, self heating or leakage of electricity, from whatever cause including lightning.
Loss / damage / destruction of Boilers, Economizers or other Vessels in which steam is generated machinery or apparatus subject to Centrifugal force, by its own explosion/ implosion.
Location of Risk:
The proposer shall describe all locations where the properties are built or installed or stored or kept at the inception
Any change of location of risk shall be covered on intimation of such change.
Change of ownership in the insured property shall be intimated so that the new owner may be covered be means of suitable endorsement.
Any material change in the location of risk, trade or manufacturing activities shall be intimated to the insurer so that the changes are endorsed to offer continuous cover.
Period of Coverage:
Fire Policy is an annual policy, generally, renewable each year.
Long Term policy (for a minimum period of three years) can be considered for covering "dwellings" only with suitable discounts in premium.
Cover for STFI and RSMD perils can be considered during currency (where they are deleted at inception by choice) in special circumstances.
Policy can be cancelled at any time during the currency with suitable refund of premium for the unexpired period.
Deletion of Perils at the inception:
STFI and RSMD perils can be deleted at the inception of the policy for which suitable reduction in package premium rate is allowed.
Who can take the policy?
Any person / firm / organization / institution who may suffer financial loss in the event of operation of insurable perils may insure such property under the fire policy. They may be broadly categorized as under :
Owners of Building and contents such as house hold articles, furniture etc.
Shop Keepers.
Educational/ Research Institutions.
Hotels, Boarding and Lodgings, Hospitals, Clinics or such service providers.
Industrial and Manufacturing Firms.
Godown Keepers.
Bailees, Lessor, Lessee, Banks, Financial Institutions, Mortgagors, Mortgagees.
Traders in stocks.
Trustees, Charitable Institutions.
Transporters and C & F Agents.
Add on covers
In addition to the perils/ expenses covered, the proposer can opt to seek cover in respect of the following perils/ expenses at inception or during currency of the policy on payment of additional premium :
Perils:
Loss/ damage/ destruction of the property caused by
Deterioration of Stocks in Cold Storage premises due to power failure following damage due to an insured peril
Forest Fire
Impact Damage due to Insured's own Vehicles, Fork lifts and the like and articles dropped therefrom
Spontaneous Combustion
Omission to insure additions, alterations or extensions
Earthquake (Fire and Shock).
Spoilage material damage cover.
Leakage and contamination cover.
Temporary removal of stocks.
Terrorism.
Expenses:
Architects , Surveyors and Consulting Engineer's Fees (in excess of 3% claim amount)
Debris Removal (in excess of 1% of claim amount)
Loss of rent.
Insurance of additional expenses of rent for alternative accommodation.
Start up Expenses.
How to select the sum insured?
Sum Insured of a property should represent the Market Value.
Where more than one building (and contents) are insured under a single policy, block wise values shall be furnished in respect of Building, Plant & Machinery, Stocks and other contents.
In case the value of a property increases due to factors like increase in prime cost, Exchange rate etc. during the currency of the policy, the corresponding sum insured may be increased on payment of proportionate premium.
Similarly, any reduction in sum insured during currency may be effected for which refund of premium will be allowed on short period basis.
Following guidelines, though not exhaustive, are provided for arriving at the sums to be insured for various properties :
