Add on Covers

ADD ON COVERS( ADD ON COVERS(FIRE POLICY) FIRE POLICY) By Sunit Mathur

Add on Covers
Standard fire and special perils policy can be extended to include ADD ON COVERS. Premium to be charged on Policy Rate or rates given. For mid term inclusion of Add on Covers annual premium shall be charged. No refund of premium shall be made on Add on Covers being Cancelled mid term unless the policy is cancelled simultaneously or replaced by a fresh insurance including add on covers for an identical or increased amount. Earthquake ,Terrorism, Spontaneous Combustion, and Forest Fire are to be added (whenever such perils are opted) to the Policy rate for providing Add on Covers lik Architect, Surveyors & consulting Engineers Fee, removal of Debris, Deterioration of stock in cold storage , start up expenses etc.

Architect, Surveyors & Consulting Engineer Fees

Premium Rate:- Policy Rate i. In Excess of 3% of the adjusted loss. ii. Expenses incurred for plans, specification, tenders, quantities & services in connection with the superintendence of the reinstatement for the building, machinery & equipment. iii. Cost in connection with the preparation of the insured estimate of loss not covered. iv. Premium rate same as applicable to the Standard fire & special perils policy. v. Specified sum insured not exceeding 7.5% of claim amount

2. Debris Removal
Premium Rate :- Policy Rate. i. In Excess of 1% of the adjusted loss. ii. a. Removal of debris. b. Dismantling or demolishing. c. Storing up or propping. iii. Item ii) b & ii) c to be deleted if building nor machinery covered. iv. Premium rate same as Applicable to the Standard Fire & special perils policy. v. Specified sum insured not exceeding 10% of sum insured.

3.

a) Deterioration of stocks in cold storage due to accidental power failure consequent to damage at the premises of power station due to an insured peril By change of temperature in consequence of failure of electric supply at the terminal ends of the electric service feeders from which the insured obtains electric supply directly. Due to damage caused by any peril insured to property at insured premises or any electric station or substation of public electric supply undertaking from which the insured obtains electric supply.

Not liable for any deliberate act of Govt., Municipal or Local authority or Supply authority not performed for the sole purpose of safeguarding life or protecting any part of the supply undertakings system or by the exercise by any such authority of its power to withhold or restrict or ration not necessitated solely by damage to the supply undertakings equipments by insured peril. Duration of such failure should exceed 24 hours. The burden of providing that damage is covered shall be upon the insured. Premium rate will be 25% of the policy rate on sum insured of stocks.

 Damage to property covered caused by change of temperature in consequence of failure of electric supply following damage to insureds property due to insured peril(s). Not liable for any deliberate act of govt. municipal or local authority or supply authority not performed for the sole purpose of safeguarding life or protecting any part of the supply undertakings system or by the exercise by any such authority of its power to with hold or restrict or ration not necessitated solely by damage to the supply undertakings equipments by insured peril.

Duration of such failure should exceed 24 hours. The burden of providing that damage is covered shall be upon the insured. Premium rate will be policy rate on sum insured of stocks.

Forest Fire
(4)(Premium rate Rs 5%0 minimum) Damage to the property directly caused by burning whether accidental or otherwise of forest, jungles, Bushes and clearing of lands by fire. Premium Rate : Where loss experience for previous 5 years excluding the expiring policy period is less than 30% a 50% discount on the rate may be considered.

 Where loss experiene is above 60% the rate should be adjusted in such a way that the loss experience for the policy period worked out as above in (i) be adjusted to 60% subject to maximum rate of Rs.15%.

Forest Fire
S.I Rs.2,40,00,000/Rate @ Rs.5%0 Premium Rs.1,20,000/Period of Insurance Premium 01.04.1995 to 31.03.1996 Rs.1,20,000 01.04.1996 to 31.03.1997 Rs.1,20,000 01.04.1997 to 31.03.1998 Rs.1,20,000 01.04.1998 to 31.03.1999 Rs.1,20,000 01.04.1999 to 31.03.2000 Rs.1,20,000 6,00,000

Incurred claim 1,00,000 1,20,000 1,40,000 60,000 1,80,000 6,00,000

01.04.2000 to 31.03.2001 Rs.1,20,000

1,00,000

 Incurred claim = Incurred claim * 100 Premium =6,00,000 * 100 = 100% 6,00,000 Load the Premium so that it come 60% 6,00,000 * 100 = 60% 1,0,00,000 Premium payable at renewal = Rs.4,00,000/- + 1,20,000 Total Rs.5,20,000 Rate = 5,20,000 * 1000 = Rs.21.66%0 2,40,00,000 MAX. Chargeable Rs.15%0 Premium payable = Rs.3,60,000/- for renewal 01-04-2001 To 31-03-2002

 (5)Impact damage due to insureds own rail/road vehicles, fork lifts, cranes, stackers and the like and articles dropped there from. Damage caused due to impact by direct contact to insureds property caused by insureds own rail/road vehicles, fork lifts, cranes, stackers and the like and articles dropped there from. Premium 5% of policy rate on policy sum insured.

 (6)Spontaneous Combustion Loss or damage by fire only to the property insured caused by its own fermentation, natural heating or spontaneous combustion. N.B By fire only must not be omitted under any circumstance. Premium to be charged on Sum Insured of relative commodity

Premium Rates

Category I (low or non existment)

0.25%

Category II (moderate)

0.50%

Category III (variable)

0.75%

Category IV (high)

1.00%

 (7)Omission To Insure Additions, Alterations or Extensions Clause Policy covers Buildings and/or Machinery, Plant and other contents (contents means furniture and fittings excluding stocks) which the insured may erect or acquire or may become responsible: (a)At the within described premises. (b)For use as factories. Liability shall not exceed 5% of the sum insured by each item in respect of (a) and 5% of the sum insured by item no. in respect of (b).

 Premium rate shall be the policy rate on 5% of sum insured on Building/Machinery/Furniture & fittings. Premium as above should be collected in advance. The insured shall inform the insurer of each additional insurance as soon as it comes to their knowledge and shall pay appropriate additional premium from the date of inception. All new additions to Buildings &/or Machinery not specifically insured/included during the currency of the policy should be declared at the end of the year and suitable additional premium paid on pro rata basis from the date of completion of the construction/ erections or additions may be suitably adjusted.

 If insured fails to declare values of such additions within 30 days after the expiry of policy there will be no refund of the advance premium paid. (8)Earthquake (Fire And Shock) (a) If SFTI Group of Perils Peril is deleted: Covers loss (including loss by fire) due to earthquake including Landslide/Rockslide resulting there from but excluding flood or overflow of the sea, lakes reservoirs and rivers caused by earthquake.

 (B) If SFTI Peril is not deleted: Covers loss (including loss by fire) due to earthquake including Landslide/Rockslide resulting there from but including flood or overflow of the sea, lakes, reservoirs and rivers caused by earthquake. Company shall not be liable for 5% of each and every claim subject to Minimum of Rs.10,000/-. Entire property in one complex compound/location is to be covered and the S.I should be identical to the main policy (except for the value of plinth and foundation). Onus of proof lies with the insured (if so required by the company).

Earthquake Zone

Rate

1.00%0

II

0.50%0

III

0.20%0

IV

0.10%0

 Dwellings offices Hotels, Shops etc (Section (III) 0.10%0 regardless of Zones. (9)Spoilage Material Damage Cover Perils causing the spoilage should be same as those covered under the policy. (ii)Cover to material damage i.e. (a)Loss of stock in process (b)Damage to Machinery, Containers and Equipments (including cost of removal of debris and cleaning).

 Loss or damage by spoilage due to retardation or interruption or cessation of any process caused by any of the perils covered under the policy subject to liability admitted under the policy. Sum to be insured cover must be for all stocks and Machinery, Container and Equipment in specified blocks, specified sums be declared for each block and must be made subject to average. Premium to charged on the value of stocks in specified blocks @ 5 times the policy rate and 2.5 times the policy rate on the value of machinery, containers and equipments in specified blocks.

Leakage and Contamination (10)Cover

Cover for oils and chemicals only Cover to include the risk of :Accidental leakage and contamination Accidental leakage (A)Where leakage and contamination cover is granted: Physical loss of oils/chemicals by leakage from its container by accidental means and all accidental contaminations by contact with foreign matter.

 EXCLUSIONS:-Infidelity or dishonesty on the part of the insured/employees, shortage, shrinkage, evaporation, mysterious disappearance or unexplained losses or loss by burglary or theft not covered. Loss resulting from processing or faulty workmanship not covered. Contamination due to improper handling or controls by insureds own employees. Loss of use, loss of earnings, delay or loss of market or other consequential or indirect loss of any kind.

 (B)Where leakage cover alone is granted Physical loss of oils/chemicals by leakage from its container by accidental means and all accidental contaminations by contact with foreign matter EXCLUSIONS:-. Infidelity or dishonesty on the part of the insured/employees shortage, shrinkage, evaporation, mysterious disappearance or unexplained losses or loss by burglary or theft not covered. Loss resulting from processing or faculty workmanship not covered. Contamination due to improper handling or controls by insureds own employees. Loss of use, loss of earnings, delay or loss of market or other consequential or indirect loss of any kind.

 Special Conditions (Applicable to A and B) Before pumping and/or decantation operations the insured shall arrange at their own expense sampling and purity certification by competent, approved and independent agency/surveyor for such distinct lot, batch or tank load ex ocean vessel of the insured subject matter and shall pump/decant only such material as is pure and without contaminations (at insured expense).

 Inspection and certification from competent, approved and independent agency/surveyor as to the cleanliness and fitness of the pipe lines, pumping equipment and the receiving tanks prior to the commencement of pumping, decanting, receiving and/or storage operations (at insured expenses). Such certification should confirm that the pumping, carrying and storage equipment facilities and tanks are free from impurities, contaminants and/or residue or left over from previous use of equipments, facilities or storage tanks.

 Fresh certification would be required in the event of the said tanks being empty and fresh stocks are pumped/decanted in during the currency of the policy. Certificate from a competent approved and independent agency/surveyor as to the purity and quality of the insured subject matter after receipt in land tanks (at insured expenses). Basis of valuation Market value at the time and place of loss. All losses during any one period of seventy two consecutive hours caused by earthquake shock shall be deemed to have been caused by Earthquake and will constitute one loss. Insured shall select a time from which any such period shall commence but no two such selected periods shall over lap.

 Each claim is subject to an excess of 1% on each tank with a minimum of Rs.60,000/- each loss. Condition no 1 to 5 not applicable where leakage cover alone is granted.

Average Condition
Premium Rates Leakage cover Leakage and contamination cover Rs.10%0

Where the tanks are within insureds own premises Where the tanks are located elsewhere

Rs.5%0

Rs.6%0

Rs.12%0

Temporary Removal Of Stock (11)Clause

Stock not exceeding 10% of the total sum insured of stock is covered while temporarily removed to any other premises for fabrication/processing/ finishing or other purposes. Pro Rata average condition will apply to the limit of stocks temporarily removed as well as to the total sum insured of such stock under the policy. Rate:- 10% of the policy rate on sum insured on stock.

 (12)Loss of Rent Clause Rent payable if the building or part thereof is unfit for occupation due to damage by the perils insured. Amount of rent payable = Period for reinstatement of the Bldg./ Term of the rent insured * S.I on Rent Premium Rate 10% of Policy rate on sum insured on rent. (13)Start up Expenses Start up costs necessarily and reasonably incurred by the insured upon a loss covered by the policy. Premium Rate Policy Rate.

 (14)Insurance of additional expenses of rent for an alternate accommodation For Non-Manufacturing premises. Not to be granted under consequential loss (fire) policy. Max. Indemnity Period 3 years. Additional expenses means additional rent actually paid i.e the difference between the new rent and the original rent. Certificate from the local municipal authority or an architect as a proof that premises are untenantable.

 Cover not for buildings of kutcha construction. The area for alternative accomodation must be equivalent to the area presently occupied. If area is more then amount of rent payable.
Area of the premises in the insureds occupation/XAdditional rent Area of the alternate accommodation taken by the insured

No restrictions of locality so long as the alternate accommodation is taken in the same city/town. For the owner occupant the standard rent based on the rateable values fixed by Municipal / Revenue authority for tax purpose may be treated as original rent.

 It is compulsory for the owner occupant to insure both building and contents. Tenants to insure the contents. If the insured is a tenant only and for safeguarding his legal tenancy right is obliged to pay rent for the premises even during the period when it is not fit for occupation the additional rent is the actual rent for the alternate accommodation. If the tenant is not obliged to pay rent during the period when it is not fit for occupation then additional rent=Actual rent paid Minus Rent he was paying.

THANKS ANY ??????????????????