Top Banner
WHAT IS INSURANCE? WHAT IS INSURANCE? Risk Transfer mechanism Risk Transfer mechanism Economic Concept of Insurance: Economic Concept of Insurance: 1. Insurer offers policy to cover 1. Insurer offers policy to cover specified risks specified risks 2. Insurer collects policy premium from 2. Insurer collects policy premium from customers customers 3. Insurer invests premium 3. Insurer invests premium 4. Insurer pays money to insured 4. Insurer pays money to insured customers in the event of losses covered customers in the event of losses covered by policy. by policy.
108
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Page 1: Fire insurance

WHAT IS INSURANCE?WHAT IS INSURANCE?

Risk Transfer mechanismRisk Transfer mechanism

Economic Concept of Insurance: Economic Concept of Insurance:

1. Insurer offers policy to cover specified risks1. Insurer offers policy to cover specified risks

2. Insurer collects policy premium from 2. Insurer collects policy premium from customerscustomers

3. Insurer invests premium3. Insurer invests premium

4. Insurer pays money to insured customers in the 4. Insurer pays money to insured customers in the event of losses covered by policy.event of losses covered by policy.

Page 2: Fire insurance

COMMON TERMS IN COMMON TERMS IN INSURANCEINSURANCE

Proposal FormProposal Form :: Basis of offerBasis of offer PremiumPremium :: ConsiderationConsideration PolicyPolicy :: AcceptanceAcceptance IntermediaryIntermediary :: Interface Interface

between the Insurers & the between the Insurers & the Insured Insured

Insurance ClaimInsurance Claim :: Claim for reimbursement Claim for reimbursement from the insurance from the insurance

company company when the insured when the insured has suffered has suffered a loss that is a loss that is covered under an covered under an insurance insurance policypolicy

Page 3: Fire insurance

INSURANCEINSURANCE

LIFE LIFE GENERAL GENERAL

INSURANCEINSURANCE INSURANCEINSURANCE

Page 4: Fire insurance

GENERAL INSURANCEGENERAL INSURANCE

Property InsuranceProperty Insurance Marine InsuranceMarine Insurance Motor InsuranceMotor Insurance Miscellaneous InsuranceMiscellaneous Insurance Liability InsuranceLiability Insurance Health InsuranceHealth Insurance

Page 5: Fire insurance

PROPERTY INSURANCEPROPERTY INSURANCE

Fire InsuranceFire Insurance Engineering InsuranceEngineering Insurance FLOPFLOP MLOPMLOP

Page 6: Fire insurance

Tariff Policies:Tariff Policies:

• Tariff Advisory Committee is a part of the IRDA Tariff Advisory Committee is a part of the IRDA • TAC was entrusted in formulating the rules &TAC was entrusted in formulating the rules &

regulations governing certain class of business in India regulations governing certain class of business in India Prior to detariffing, Companies could charge thePrior to detariffing, Companies could charge the

premium as per the tariff only.premium as per the tariff only. Tariff gives the strict guidelines to what to cover and Tariff gives the strict guidelines to what to cover and

what not to cover. what not to cover. The tariff specifies the minimum rate for a risk to be The tariff specifies the minimum rate for a risk to be

coveredcovered

Fire is now a non tariff productFire is now a non tariff product

Page 7: Fire insurance

FIRE INSURANCEFIRE INSURANCE

What is Fire?What is Fire? Fire would mean a combustion which is Fire would mean a combustion which is

rapid enough to produce a flame or glow. rapid enough to produce a flame or glow. A fire, for purposes of Property Insurance, A fire, for purposes of Property Insurance,

must be "hostile," must be "hostile,"

ie, it should not be in a place in which it is ie, it should not be in a place in which it is intended to be intended to be

Page 8: Fire insurance

Why is there a need for Fire Why is there a need for Fire Insurance?Insurance?

1. The existence of property susceptible to 1. The existence of property susceptible to damage by fire or allied perils. damage by fire or allied perils.

2. The fact that this property has certain 2. The fact that this property has certain intrinsic value in terms of money. intrinsic value in terms of money.

3. Due to fire there may be a damage/loss of 3. Due to fire there may be a damage/loss of property and this loss of property may cause property and this loss of property may cause other losses like loss of profit. other losses like loss of profit.

Page 9: Fire insurance

Subject matter of Fire Insurance:Subject matter of Fire Insurance: The subject matter of fire insurance may The subject matter of fire insurance may be any kind of movable or immovable be any kind of movable or immovable property having pecuniary value, like: property having pecuniary value, like:

Building Building Plant & Machinery Plant & Machinery Furniture, Fixtures & Fittings Furniture, Fixtures & Fittings Stock etc Stock etc

Page 10: Fire insurance

Who can take a Fire Policy?Who can take a Fire Policy?

Any person or organisation that has an Any person or organisation that has an insurable interest in the subject matter of insurable interest in the subject matter of insurance can take the policy insurance can take the policy

Page 11: Fire insurance

SECTIONS UNDER A FIRE POLICYSECTIONS UNDER A FIRE POLICY Section I Section I General Rules & Regulations General Rules & Regulations Section II Section II Standard fire & Special Perils policy Standard fire & Special Perils policy Section III Section III Dwellings, Offices, Hotels, Shops Dwellings, Offices, Hotels, Shops

located outside the compounds of located outside the compounds of Industrial/Manufacturing Risk Industrial/Manufacturing Risk

Section IV Section IV Industrial/Manufacturing Risk Industrial/Manufacturing Risk Section V Section V Utilities outside the compound of Utilities outside the compound of

industrial / manufacturing risk industrial / manufacturing risk Section VI Section VI Storage Risk located outside the Storage Risk located outside the

compound of Industrial / compound of Industrial / manufacturing risk manufacturing risk

Section VII Section VII Tank Farm/Gas Holders located Tank Farm/Gas Holders located outside the compound of Industrial / outside the compound of Industrial / manufacturing risk manufacturing risk

Section VIII Section VIII Add on covers Add on covers

Page 12: Fire insurance

SECTION ISECTION IGENERAL RULES&REGULATIONSGENERAL RULES&REGULATIONS

These are certain rules and regulations These are certain rules and regulations which are applicable to all sections of which are applicable to all sections of

the Fire Policy: the Fire Policy:

Page 13: Fire insurance

Kutcha Construction Kutcha Construction

Buildings having walls/Roofs of Buildings having walls/Roofs of wooden planks/thatched leaves, wooden planks/thatched leaves, grass or hay shall be treated as grass or hay shall be treated as Kutcha construction for ratingKutcha construction for rating

Page 14: Fire insurance

Pucca ConstructionPucca Construction

Walls, Roofs made of concrete, RCC and Walls, Roofs made of concrete, RCC and bricks will be pucca constructionbricks will be pucca construction

Page 15: Fire insurance

Minimum premiumMinimum premium

Minimum premium is Rs. 50/- for risks rated Minimum premium is Rs. 50/- for risks rated under Section III & tiny sectors under Section IV under Section III & tiny sectors under Section IV

For all other sections it is Rs 100 For all other sections it is Rs 100

Sections Sections Min Premium Rates Min Premium Rates

Section III & IV Section III & IV 50 50

All sections except III & IV All sections except III & IV 100100

Page 16: Fire insurance

Types of policiesTypes of policiesValued PolicyValued Policy

A valued policy can be issued for A valued policy can be issued for properties whose Market values cannot properties whose Market values cannot be ascertained be ascertained

eg. Curios, Manuscripts, work of art eg. Curios, Manuscripts, work of art subject to the valuation certificate being subject to the valuation certificate being submitted and found acceptable by the submitted and found acceptable by the insurers. insurers.

For e.g. The world famous picture of For e.g. The world famous picture of “Mona Lisa” would be covered under a “Mona Lisa” would be covered under a valued policy valued policy

Page 17: Fire insurance

Long Term Policies Long Term Policies

Most policies are issued for a period of 1 Most policies are issued for a period of 1 year (Annual)year (Annual)

A long term policy is the exception since it A long term policy is the exception since it is issued for a period exceeding 12 months. is issued for a period exceeding 12 months.

This happens only in the case of This happens only in the case of “Dwellings” “Dwellings”

Page 18: Fire insurance

Long Term Policies (Contd)Long Term Policies (Contd)

Long Term policies can be issued for a minimum Long Term policies can be issued for a minimum of 3 years of 3 years

Refund for mid term cancellation of policy is Refund for mid term cancellation of policy is allowed (Subject to minimum premium retention)allowed (Subject to minimum premium retention)

No refund shall be allowed if there has been a No refund shall be allowed if there has been a claim under the policyclaim under the policy

Mid term inclusion of perils is not allowed Mid term inclusion of perils is not allowed Premium for entire policy period has to be Premium for entire policy period has to be

collected in advance.collected in advance.

Page 19: Fire insurance

Long Term Policies (Contd)Long Term Policies (Contd)

Long Term Policies shall be issued based on either of Long Term Policies shall be issued based on either of the following 2 methodsthe following 2 methods

A) No discount is offered and sum insured will A) No discount is offered and sum insured will automatically increase by 10% for every completed 12 automatically increase by 10% for every completed 12 months. months.

OrOr B) Discounts given as per chart below on fire rate B) Discounts given as per chart below on fire rate

only. In this case basic sum insured will be same only. In this case basic sum insured will be same throughout the policy period. throughout the policy period.

Discounts ranging from 15% to 50% are allowed on the Discounts ranging from 15% to 50% are allowed on the premium for the respective periods. premium for the respective periods.

Page 20: Fire insurance

Long Term Policies (Contd)Long Term Policies (Contd)

3 years- minimum3 years- minimum 3yrs-15% discount3yrs-15% discount 4yrs-20% discount4yrs-20% discount 5yrs-25% discount5yrs-25% discount 6yrs-30% discount6yrs-30% discount 7yrs-35% discount7yrs-35% discount 8 yrs-40% discount8 yrs-40% discount 9 Yrs-45% discount9 Yrs-45% discount 10yrs or more-50% discount10yrs or more-50% discount No long term discount can be given on EQNo long term discount can be given on EQ

Page 21: Fire insurance

Floater PolicyFloater Policy

Floater policy can be issued for stocks at Floater policy can be issued for stocks at various locations under one Sum Insured. various locations under one Sum Insured.

Unspecified locations shall not be allowed.Unspecified locations shall not be allowed. The rate shall be the highest rate applicable The rate shall be the highest rate applicable

to insured’s stock with a loading of 10%. to insured’s stock with a loading of 10%. If rate chargeable is different for different If rate chargeable is different for different

locations then highest rate will be charged locations then highest rate will be charged on total sum insuredon total sum insured

Page 22: Fire insurance

Examples – Floater Policy Examples – Floater Policy

Imagine if Bajaj Auto has 2 manufacturing plants Imagine if Bajaj Auto has 2 manufacturing plants one in Pune and other in Chennai.one in Pune and other in Chennai.

Under this policy both the plants can be covered Under this policy both the plants can be covered for stock under one Sum Insured. for stock under one Sum Insured.

The premium is calculated by taking the combined The premium is calculated by taking the combined value of both the plants along with a 10 % loading value of both the plants along with a 10 % loading charge charge

Page 23: Fire insurance

Declaration policyDeclaration policy

If the insured’s quantity or value of stock If the insured’s quantity or value of stock fluctuates frequently then he can opt for a fluctuates frequently then he can opt for a declaration policy. declaration policy.

It is a policy where the insured declares the It is a policy where the insured declares the sum insured and he has to provide monthly sum insured and he has to provide monthly declarations. declarations.

The policy is applicable only to stocksThe policy is applicable only to stocks

Page 24: Fire insurance

Declaration policy (Contd)Declaration policy (Contd)

Sum insured is decided by the insured Sum insured is decided by the insured based on the average stock or highest value based on the average stock or highest value of stock in the month. of stock in the month.

The minimum SI is Rs 1 crore is one or The minimum SI is Rs 1 crore is one or more locations and the sum insured shall more locations and the sum insured shall not be less than 25 lakhs in at least one of not be less than 25 lakhs in at least one of these locations these locations

Page 25: Fire insurance

Declaration policy (Contd)Declaration policy (Contd)

Declaration policies cannot be issued in Declaration policies cannot be issued in respect of: respect of:

– Stock in process Stock in process – Stocks at railway siding Stocks at railway siding

– Insurance required for a short periodInsurance required for a short period

Page 26: Fire insurance

Declaration Policy (Contd)Declaration Policy (Contd)

Reduction of sum insured is not allowedReduction of sum insured is not allowed

Refund of premium at the time of Refund of premium at the time of adjustment cannot exceed 50% of premium adjustment cannot exceed 50% of premium charged on the policycharged on the policy

Page 27: Fire insurance

Examples – Declaration Examples – Declaration

John owns a fabrication factory in Sholapur & John owns a fabrication factory in Sholapur & Kolhapur. Kolhapur.

The steel rates per kg keeps changing every week The steel rates per kg keeps changing every week according to demand & supply. according to demand & supply.

Hence John would like to opt for a Declaration Hence John would like to opt for a Declaration policy which is more convenient for him. policy which is more convenient for him.

a) John declares that his average value of the stock a) John declares that his average value of the stock over both the locations is 2 crores and specifically over both the locations is 2 crores and specifically at Kolhapur it is 22 lakhs. Can he get a at Kolhapur it is 22 lakhs. Can he get a Declaration policy? Declaration policy?

Page 28: Fire insurance

Examples – Declaration PolicyExamples – Declaration Policy

b) Can he insure steel pipes which are b) Can he insure steel pipes which are undergoing welding in the factory? undergoing welding in the factory?

c) John wants a short term cover for his c) John wants a short term cover for his stock? Will he get it?stock? Will he get it?

Page 29: Fire insurance

Floater Declaration PolicyFloater Declaration Policy

It is a combination of Floater and Declaration It is a combination of Floater and Declaration policy which needs to have a minimum sum policy which needs to have a minimum sum insured of Rs 2 crores. The maximum premium insured of Rs 2 crores. The maximum premium refund is 20 % and the minimum retention should refund is 20 % and the minimum retention should be 80% of the total premium. be 80% of the total premium. There is a 10% loading charge here There is a 10% loading charge here

Floater Policy + Declaration Policy Floater Policy + Declaration Policy = Floater Declaration Policy = Floater Declaration Policy

Page 30: Fire insurance

Examples – Floater Declaration Examples – Floater Declaration

Let us look at how Amul insures their ice-cream. Let us look at how Amul insures their ice-cream.

Amul operates out of multiple locations across India. Amul operates out of multiple locations across India. Here they face two problems. First of all ice-cream is Here they face two problems. First of all ice-cream is highly seasonal highly seasonal

Hence at different locations the stock would vary but Hence at different locations the stock would vary but more importantly the value of the stock differs. more importantly the value of the stock differs.

Also Amul would find it difficult to find out the exact Also Amul would find it difficult to find out the exact value of their stock at any given day. value of their stock at any given day.

This is where the policy has an advantage over the This is where the policy has an advantage over the other policies other policies

Page 31: Fire insurance

Example-Floater Declaration PolicyExample-Floater Declaration Policy

With this policy now Amul can With this policy now Amul can Cover all locations under a single sum Cover all locations under a single sum

insured insured Takes care of his SI through a monthly Takes care of his SI through a monthly

declarationdeclaration It will take care of fluctuationsIt will take care of fluctuations

Page 32: Fire insurance

SUM INSUREDSUM INSURED

What is the basis of Sum Insured?What is the basis of Sum Insured?

Page 33: Fire insurance

Market ValueMarket Value Under the Standard Fire policy, the basis of Under the Standard Fire policy, the basis of

selecting Sum Insured and the basis of valuation selecting Sum Insured and the basis of valuation for loss assessment is 'Market Value'. for loss assessment is 'Market Value'.

The Sum Insured should be selected so that it is The Sum Insured should be selected so that it is adequate or equal to the Market Value at any time adequate or equal to the Market Value at any time during the policy period. during the policy period.

At the time of loss assessment, the applicable At the time of loss assessment, the applicable value for reference is the Market Value value for reference is the Market Value immediately prior to the occurrence of loss.immediately prior to the occurrence of loss.

Page 34: Fire insurance

Reinstatement ValueReinstatement Value

The Sum Insured for Buildings, Machinery The Sum Insured for Buildings, Machinery and FFF can also be selected / opted on and FFF can also be selected / opted on basis of 'Reinstatement Value'. basis of 'Reinstatement Value'.

The Reinstatement Value is the value The Reinstatement Value is the value required to 'Replace' or 'Reinstate' the required to 'Replace' or 'Reinstate' the property to its condition prior to the loss.property to its condition prior to the loss.

This option cannot be exercised for This option cannot be exercised for insurance of 'Stocks'. insurance of 'Stocks'.

Page 35: Fire insurance

Underinsurance = Underinsurance = (Sum Insured/Actual Value)*100(Sum Insured/Actual Value)*100

Market value basis - both depreciation and Market value basis - both depreciation and under insurance are applicable under insurance are applicable

Reinstatement value basis - only under Reinstatement value basis - only under insurance is applicableinsurance is applicable

Page 36: Fire insurance

Rules of CancellationRules of Cancellation

Policy can be cancelled by either the insured or Policy can be cancelled by either the insured or the company. If the company opts for cancellation the company. If the company opts for cancellation of the policy then they should give 15 days notice of the policy then they should give 15 days notice

Conditions:Conditions: Insurer-Premium refund on pro-rata basis for the Insurer-Premium refund on pro-rata basis for the

unexpired period unexpired period Insured-Premium retention on short-period basis Insured-Premium retention on short-period basis

for period which the policy was in force for period which the policy was in force

Page 37: Fire insurance

Table for Short period InsuranceTable for Short period Insurance

Short period means any insurance policy that is less than 12 Short period means any insurance policy that is less than 12 months months

For a period not exceeding 15 days 10% of the annual rate For a period not exceeding 15 days 10% of the annual rate For a period not exceeding 1 month 15% of the Annual rate For a period not exceeding 1 month 15% of the Annual rate For a period not exceeding 2 months 30% of the Annual rate For a period not exceeding 2 months 30% of the Annual rate For a period not exceeding 3 months 40% of the Annual rate For a period not exceeding 3 months 40% of the Annual rate For a period not exceeding 4 months 50% of the Annual rate For a period not exceeding 4 months 50% of the Annual rate For a period not exceeding 5 months 60% of the Annual rate For a period not exceeding 5 months 60% of the Annual rate For a period not exceeding 6 months 70% of the Annual rate For a period not exceeding 6 months 70% of the Annual rate For a period not exceeding 7 months 75% of the Annual rate For a period not exceeding 7 months 75% of the Annual rate For a period not exceeding 8 months 80% of the Annual rate For a period not exceeding 8 months 80% of the Annual rate For a period not exceeding 9 months 85% of the Annual rate For a period not exceeding 9 months 85% of the Annual rate For a period exceeding 9 months The full Annual rate For a period exceeding 9 months The full Annual rate

Page 38: Fire insurance

Mid Term CoverMid Term Cover Generally it is not permissible to grant mid term Generally it is not permissible to grant mid term

cover for STFI or RSMD. cover for STFI or RSMD.

The following provisions shall apply where such The following provisions shall apply where such covers are granted mid-term covers are granted mid-term

a) Insurers must receive specific advice from the a) Insurers must receive specific advice from the insured accompanied by payment of the required insured accompanied by payment of the required additional premium in cash or by draft additional premium in cash or by draft

b) Cover shall commence 15 days after receipt of b) Cover shall commence 15 days after receipt of premium and rates will be applicable on short premium and rates will be applicable on short period scale covering the entire interest of the period scale covering the entire interest of the insured up to the expiry period insured up to the expiry period

c) Cover will be granted for entire property with c) Cover will be granted for entire property with no option for selection. no option for selection.

Page 39: Fire insurance

Partial InsurancePartial Insurance It is not permissible to issue a policy It is not permissible to issue a policy

covering only certain portions of building. covering only certain portions of building. Plinth & foundation of a building maybe Plinth & foundation of a building maybe excluded excluded

It is not permissible to insure parts of a It is not permissible to insure parts of a machinery machinery

This is done to ensure that selection of risk This is done to ensure that selection of risk (which is against the basics of insurance) is (which is against the basics of insurance) is not carried outnot carried out

Page 40: Fire insurance

Section IISection II

Standard Fire & Special Perils Standard Fire & Special Perils covered in a Fire policycovered in a Fire policy

Page 41: Fire insurance

1. Fire1. Fire

Ignition under accidental or fortuitous Ignition under accidental or fortuitous circumstances. circumstances.

Spontaneous combustion, fermentation or Spontaneous combustion, fermentation or heating or scorching without ignition is not heating or scorching without ignition is not a fire.a fire.

Page 42: Fire insurance

Fire (contd)Fire (contd)

According to insurance Parlance, a Fire as According to insurance Parlance, a Fire as covered under a Fire policy is said to have covered under a Fire policy is said to have occurred when the following conditions are occurred when the following conditions are satisfiedsatisfied

There is actual ignition There is actual ignition The property is one which ought not to have The property is one which ought not to have

been on fire been on fire The fire is purely accidental or fortuitous in The fire is purely accidental or fortuitous in

origin, as far as the insured is concerned origin, as far as the insured is concerned

Page 43: Fire insurance

What other Losses are parts of a What other Losses are parts of a Fire Policy?Fire Policy?

Damage during or immediately Damage during or immediately following a fire caused by smoke, following a fire caused by smoke, scorching walls scorching walls

Damage caused by the Fire Damage caused by the Fire brigade in the discharge of their brigade in the discharge of their duties. duties.

Damage to property by exposure Damage to property by exposure to weather caused as a result of to weather caused as a result of removal of property from a removal of property from a burning building in effort to burning building in effort to mitigate the lossmitigate the loss

Page 44: Fire insurance

2. Lightning - AOG Peril2. Lightning - AOG Peril

Flash of light in the sky caused by the Flash of light in the sky caused by the discharge of atmospheric electricity from discharge of atmospheric electricity from one cloud to the other or to the Earth. one cloud to the other or to the Earth.

Excludes breakdown damage to electrical Excludes breakdown damage to electrical equipmentsequipments

Page 45: Fire insurance

3. Explosion/Implosion3. Explosion/Implosion

Explosion Explosion -‘“a sudden violent bursting with -‘“a sudden violent bursting with a loud report” a loud report”

Technical definition -“sudden increase in Technical definition -“sudden increase in pressure in the surrounding air, or gases, pressure in the surrounding air, or gases, from sudden and violent expansion of any from sudden and violent expansion of any substance in their neighbourhood”substance in their neighbourhood”

Explosion results in;Explosion results in; Fire damageFire damage Concussion Damage Concussion Damage

Page 46: Fire insurance

3.Explosion/Implosion3.Explosion/Implosion

ImplosionImplosion is diametrically opposite to the is diametrically opposite to the explosion. explosion.

It is the bursting inward or collapse due to It is the bursting inward or collapse due to external atmospheric pressure. external atmospheric pressure.

Page 47: Fire insurance

4. Air Craft Damage4. Air Craft Damage

Damage or destruction to the property Damage or destruction to the property insured (by fire or otherwise) caused by insured (by fire or otherwise) caused by aircraft or aerial or space devices such as aircraft or aerial or space devices such as balloons, artificial satellites etc. or articles balloons, artificial satellites etc. or articles dropped there fromdropped there from

Page 48: Fire insurance

5. Riot, Strike & Malicious 5. Riot, Strike & Malicious DamageDamage

Loss of or visible physical damage/destruction by Loss of or visible physical damage/destruction by external & violent means to insured property by external & violent means to insured property by rioters, strikers or any person acting with rioters, strikers or any person acting with malicious intentionsmalicious intentions

Riotous situation - disturbance of peace by an Riotous situation - disturbance of peace by an unlawful assemblyunlawful assembly

Malicious act - a deliberate intention & plan of Malicious act - a deliberate intention & plan of one or more individuals to do something unlawful one or more individuals to do something unlawful to cause loss or damage to other’s propertyto cause loss or damage to other’s property

Page 49: Fire insurance

6. Storm, Typhoon, Flood & 6. Storm, Typhoon, Flood & InundationInundation – AOG Peril – AOG Peril

These are natural perilsThese are natural perils Also known as “weather perils” Also known as “weather perils” These perils have a low frequency of These perils have a low frequency of

occurrenceoccurrence But are generally catastrophic & But are generally catastrophic &

devastating when they strikedevastating when they strike

Page 50: Fire insurance

7. Impact Damage7. Impact Damage

Loss of or damage to the property due to Loss of or damage to the property due to physical impact by any animal or rail or physical impact by any animal or rail or road vehicle (not belonging to or owned by road vehicle (not belonging to or owned by the insured or any occupier of the premises the insured or any occupier of the premises or their employees while acting in the or their employees while acting in the course of their employment)course of their employment)

Page 51: Fire insurance

8. Subsidence, Landslide & 8. Subsidence, Landslide & RockslideRockslide – AOG Peril – AOG Peril

Damage by fire or Damage by fire or otherwise to the otherwise to the insured property insured property directly caused by directly caused by natural calamity natural calamity resulting in subsidence resulting in subsidence or landslide including or landslide including rockslide. rockslide.

Page 52: Fire insurance

9. Bursting/Overflowing Water 9. Bursting/Overflowing Water Tanks & PipesTanks & Pipes

Damage to property by bursting or Damage to property by bursting or overflowing of water tanks, apparatus or overflowing of water tanks, apparatus or pipespipes

Page 53: Fire insurance

10. Missile Testing Operations10. Missile Testing Operations

Damage by fire or otherwise directly caused Damage by fire or otherwise directly caused by Missile Testing Operations carried out by Missile Testing Operations carried out by the Defence Department of the by the Defence Department of the Government of India.Government of India.

Page 54: Fire insurance

11. Leakage from Automatic 11. Leakage from Automatic Sprinkler InstallationsSprinkler Installations

Loss of or damage to the property insured Loss of or damage to the property insured directly caused by water discharged or directly caused by water discharged or leaking from the automatic sprinkler leaking from the automatic sprinkler installations in the premisesinstallations in the premises

Such discharge or leakage of water should Such discharge or leakage of water should be accidentalbe accidental

Page 55: Fire insurance

12. Bush Fire12. Bush Fire

A A bushfirebushfire is a fire that is a fire that occurs in the bush occurs in the bush (collective term for scrub, (collective term for scrub, woodland or grassland of woodland or grassland of Australia, New Zealand, Australia, New Zealand, New Caledonia)New Caledonia)

Loss or damage to insured Loss or damage to insured property directly caused property directly caused by burning of bushby burning of bush

Page 56: Fire insurance

CoveragesCoverages

Any loss/Damage to property due to these Any loss/Damage to property due to these 12 perils will be covered under this policy 12 perils will be covered under this policy

Architects, Surveyors & consulting Architects, Surveyors & consulting Engineers up to 3 % of claim amount. Engineers up to 3 % of claim amount.

Debris removal expenses up to 1% of Claim Debris removal expenses up to 1% of Claim amount. amount.

Page 57: Fire insurance

Perils covered – Easy to Perils covered – Easy to RememberRemember

FireFire F F Lightning Lightning L L Aircraft Damage Aircraft Damage A A Malicious Damage, Riots Malicious Damage, Riots M M Explosion/Implosion Explosion/Implosion E E Storm, Flood, Tempest Storm, Flood, Tempest S S

Bush fireBush fire B B Over Flowing/Bursting Over Flowing/Bursting O O Leakage from sprinklers Leakage from sprinklers L L Testing Missiles Testing Missiles T T Subsidence, Landslide Subsidence, Landslide S S

The last peril is Impact Damage which can be remembered as “ID”The last peril is Impact Damage which can be remembered as “ID”

Page 58: Fire insurance

Section II – ExclusionsSection II – Exclusions

5% of each& every claim subject to a 5% of each& every claim subject to a minimum of Rs 10000/- in respect of each minimum of Rs 10000/- in respect of each and every loss arising out of “Act of God and every loss arising out of “Act of God Perils” .(not applicable to dwellings)Perils” .(not applicable to dwellings)

First Rs 10000/- for each and every loss First Rs 10000/- for each and every loss arising out of other perils.(not applicable to arising out of other perils.(not applicable to dwellings)dwellings)

Page 59: Fire insurance

Exclusions - ContdExclusions - Contd

War or War-like OperationsWar or War-like Operations Ionizing Radiation, Radioactivity, Nuclear Ionizing Radiation, Radioactivity, Nuclear

materialmaterial Pollution or contamination unless this is caused by Pollution or contamination unless this is caused by

the action of an insured perilthe action of an insured peril Leakage of Electricity or Short-circuiting Leakage of Electricity or Short-circuiting (Only (Only

the particular machine or apparatus that the particular machine or apparatus that undergoes the leakage/short-circuiting is undergoes the leakage/short-circuiting is excluded, and other affected property is covered)excluded, and other affected property is covered)

Page 60: Fire insurance

Exclusions - ContdExclusions - Contd

Fees of Architects, Surveyors and Fees of Architects, Surveyors and Consulting Engineers exceeding 3% of Consulting Engineers exceeding 3% of Claim Claim (Insurance for higher amounts can (Insurance for higher amounts can be taken as an Add-On)be taken as an Add-On)

Expenses for removal of Debris exceeding Expenses for removal of Debris exceeding 1% of claim 1% of claim (Insurance for higher amounts (Insurance for higher amounts can be taken as an Add-On)can be taken as an Add-On)

Retardation or Cessation of any processRetardation or Cessation of any process

Page 61: Fire insurance

Exclusions - ContdExclusions - Contd

TheftTheft

Earthquake or volcanic eruption Earthquake or volcanic eruption (Insurance (Insurance for this can be taken as an Add-On cover)for this can be taken as an Add-On cover)

Page 62: Fire insurance

Exclusions - ContdExclusions - Contd

Bullion, curios, works of Art, cheques, Bullion, curios, works of Art, cheques, currency etc (unless specified) currency etc (unless specified)

Consequential losses of any kindConsequential losses of any kind

Page 63: Fire insurance

Exclusions - ContdExclusions - Contd

Property undergoing any heating or drying Property undergoing any heating or drying process process

Burning of property insured by order of any Burning of property insured by order of any Public authority Public authority

Its own fermentation, natural heating or Its own fermentation, natural heating or spontaneous combustion spontaneous combustion

Page 64: Fire insurance

Exclusions - ContdExclusions - Contd

Explosion/Implosion : Excludes those Explosion/Implosion : Excludes those apparatus or boilers damaged by centrifugal apparatus or boilers damaged by centrifugal forces forces

Aircraft Damage :Loss or destruction Aircraft Damage :Loss or destruction caused by pressure waves, Loss or damage caused by pressure waves, Loss or damage caused by an aircraft to which permission to caused by an aircraft to which permission to land had been extended by the insured.land had been extended by the insured.

Page 65: Fire insurance

Exclusions - ContdExclusions - Contd

STFISTFI : Excludes those resulting from : Excludes those resulting from earthquake, volcanic eruptions or other earthquake, volcanic eruptions or other convulsions of nature. convulsions of nature.

Any loss / damage caused only by rain water Any loss / damage caused only by rain water is not coveredis not covered

Page 66: Fire insurance

Exclusions – ContdExclusions – Contd

Impact Damage Impact Damage

• • Is an exclusion if it is the insured’s vehicle Is an exclusion if it is the insured’s vehicle or any occupier of the premise or any occupier of the premise

• • Belongs to an employee during the course Belongs to an employee during the course of their employment of their employment

Page 67: Fire insurance

Exclusions – ContdExclusions – Contd

Subsidence, Landslide & Rock slide :Subsidence, Landslide & Rock slide :

• • Excludes normal cracking, settlement, Excludes normal cracking, settlement, coastal erosion, demolition or defective coastal erosion, demolition or defective design design

Page 68: Fire insurance

Exclusions - ContdExclusions - Contd

Leakage from Automatic Sprinkler Leakage from Automatic Sprinkler Installations Installations

• • Excludes Repairs, Removals or Excludes Repairs, Removals or Alterations of the sprinkler installation Alterations of the sprinkler installation

• • Defects in construction known to the Defects in construction known to the insured insured

Page 69: Fire insurance

Exclusions - ContdExclusions - Contd

Bush Fire Bush Fire

• • Excludes damage caused by Forest Fire, Excludes damage caused by Forest Fire, War & Nuclear PerilsWar & Nuclear Perils

Page 70: Fire insurance

Section II – General Conditions Section II – General Conditions under the Standard Fire Policyunder the Standard Fire Policy

Policy is voidable in case of mis-Policy is voidable in case of mis-representation, mis-description or non-representation, mis-description or non-disclosure of material facts disclosure of material facts

Page 71: Fire insurance

General Conditions-ContdGeneral Conditions-Contd Insurance ceases under the following conditions Insurance ceases under the following conditions

– On expiry of 7 days from the date of fall/displacement On expiry of 7 days from the date of fall/displacement of the building except for insured perils of the building except for insured perils

– When there is a change in the Trade, Manufacture or When there is a change in the Trade, Manufacture or Occupation Contract Stands Void Occupation Contract Stands Void

– Insured Property becomes unoccupied for more than 30 Insured Property becomes unoccupied for more than 30 days (Except Dwellings)days (Except Dwellings)

– -If the interest in the property passes from the insured -If the interest in the property passes from the insured otherwise than by will or operation of law otherwise than by will or operation of law

Page 72: Fire insurance

General Conditions-ContdGeneral Conditions-Contd

An immediate notice/ claim registration is An immediate notice/ claim registration is required and detailed written report to be required and detailed written report to be submitted within 15 days submitted within 15 days

Fraudulent or false declaration will forfeit Fraudulent or false declaration will forfeit all benefits all benefits

If the value of the property is higher than If the value of the property is higher than the sum insured at the time of loss, insured the sum insured at the time of loss, insured will bear the rate able portion. The principle will bear the rate able portion. The principle of under-insurance will be applicable. of under-insurance will be applicable.

Page 73: Fire insurance

General Conditions - ContdGeneral Conditions - Contd

If some other insurance is also in force on If some other insurance is also in force on the same property then the principle of the same property then the principle of contribution will apply contribution will apply

Details of all other insurance policies Details of all other insurance policies covering same property against same perils covering same property against same perils should be provided by the insured should be provided by the insured

Page 74: Fire insurance

Section IIISection III

Hotels, Dwellings, Shops & OfficesHotels, Dwellings, Shops & Offices

Page 75: Fire insurance

Section III – Hotels, Dwellings, Section III – Hotels, Dwellings, Shops & OfficesShops & Offices

The Rules & regulations for this particular The Rules & regulations for this particular section are: section are:

Buildings and contents under this sections Buildings and contents under this sections shall be rated ‘per se’ shall be rated ‘per se’

Stock outside insured’s premises which is Stock outside insured’s premises which is adjacent is held covered.adjacent is held covered.

Grinding of lenses in optical frame shop, Grinding of lenses in optical frame shop, polishing / varnishing in furniture shop, polishing / varnishing in furniture shop, occasional repair are permitted occasional repair are permitted

Page 76: Fire insurance

Section III - ContdSection III - Contd

A loading of 10% on the rates applicable to A loading of 10% on the rates applicable to the contents for seasonal storage of crackers the contents for seasonal storage of crackers in a shop dealing in goods otherwise not in a shop dealing in goods otherwise not provided. provided.

Storage of hazardous goods up to 5 % of Storage of hazardous goods up to 5 % of total value of the stock is ignored. total value of the stock is ignored.

Reduction in premium for deletion of the Reduction in premium for deletion of the STFI( .15 per mille) & RSMD(.10 per STFI( .15 per mille) & RSMD(.10 per mille) mille)

Page 77: Fire insurance

Section IVSection IV

Rules & Regulations pertaining to Rules & Regulations pertaining to Industrial/Manufacturing RisksIndustrial/Manufacturing Risks

Page 78: Fire insurance

Section IVSection IVRules & Regulations pertaining to Rules & Regulations pertaining to Industrial/Manufacturing Risks Industrial/Manufacturing Risks

Operations incidental to the main process Operations incidental to the main process shall be rated as par with the main process if shall be rated as par with the main process if it is carried out within the compound walls it is carried out within the compound walls

Dwelling houses located inside the factory Dwelling houses located inside the factory compound maybe rated “per se” compound maybe rated “per se”

In case where more than one product is In case where more than one product is manufactured in the same block the highest manufactured in the same block the highest rate applicable shall be charged overall. rate applicable shall be charged overall.

Page 79: Fire insurance

Section VSection V

Utilities located outside the Utilities located outside the industrial/manufacturing risksindustrial/manufacturing risks

Page 80: Fire insurance

Section VSection VUtilities located outside the Utilities located outside the

industrial/manufacturing risksindustrial/manufacturing risks

For both these sections the reduction in For both these sections the reduction in premium rates for deletion of STFI and /or premium rates for deletion of STFI and /or RSMD perils at the inception of the policy RSMD perils at the inception of the policy is as follows is as follows

STFI Re 0.25% STFI Re 0.25% RSMD Re 0.10% RSMD Re 0.10%

Page 81: Fire insurance

Section VI Section VI

Storage RiskStorage Risk

Page 82: Fire insurance

Section VI -Storage RiskSection VI -Storage Risk

Rules & Regulations pertaining to Storage Risk Rules & Regulations pertaining to Storage Risk outside the compound of outside the compound of Industrial/Manufacturing Risk Industrial/Manufacturing Risk

Operations such as packaging/assorting/stitching/ Operations such as packaging/assorting/stitching/ battery charging which do not materially alter the battery charging which do not materially alter the nature of the risk are allowed to be carried out in nature of the risk are allowed to be carried out in premises. premises.

Presence of hazardous goods of higher category Presence of hazardous goods of higher category not exceeding 5% of the total value of the stocks not exceeding 5% of the total value of the stocks maybe ignored maybe ignored

Page 83: Fire insurance

Section VI - ContdSection VI - Contd

Utilities and miscellaneous blocks shall be Utilities and miscellaneous blocks shall be rated at Re 1.00 per mille rated at Re 1.00 per mille

Rates shown in this section shall apply to Rates shown in this section shall apply to Buildings/Areas used for storage of Buildings/Areas used for storage of materials. materials.

Page 84: Fire insurance

Section VI-ContdSection VI-Contd

Reduction in premium rates for deletion of Reduction in premium rates for deletion of STFI/RSMD at inception is as follows:STFI/RSMD at inception is as follows:

GodownGodown OpenOpen STFI STFI Re 0.25% Re 0.25% Re 1.5% Re 1.5% RSMD RSMD Re 0.10% Re 0.10% Re 0.10% Re 0.10%

Page 85: Fire insurance

Section VIISection VII

Tank Farms/Gas Holders outside Tank Farms/Gas Holders outside compoundcompound

Page 86: Fire insurance

Section VIISection VIITank Farms/Gas Holders outside Tank Farms/Gas Holders outside

compoundcompound

Rules & Regulations pertaining to Tank Rules & Regulations pertaining to Tank Farms/Gas Holders outside the compound of Farms/Gas Holders outside the compound of Industrial/Manufacturing Risk Industrial/Manufacturing Risk

Reduction in premium rates for deletion of STFI Reduction in premium rates for deletion of STFI and/or RSMDand/or RSMD

STFI STFI Re 0.25% Re 0.25%

RSMD RSMD Re 0.10% Re 0.10%

Page 87: Fire insurance

Section VII-ContdSection VII-Contd

All tanks located in the same dyke shall All tanks located in the same dyke shall carry the highest rate applicable to any one carry the highest rate applicable to any one tank overall tank overall

Utilities and miscellaneous blocks shall be Utilities and miscellaneous blocks shall be rated at Re 1.00 per mille rated at Re 1.00 per mille

Associated properties such as pumping Associated properties such as pumping stations, compressor house, blower houses stations, compressor house, blower houses shall be rated at par with the rate applicable shall be rated at par with the rate applicable to respective gas holders/spheres/tanks etc to respective gas holders/spheres/tanks etc

Page 88: Fire insurance

Section VIIISection VIII

Add on CoversAdd on Covers

Page 89: Fire insurance

Section VIII-Add on CoversSection VIII-Add on Covers

Standard Fire and Special Perils Policy Standard Fire and Special Perils Policy (Policy) can be extended to include the (Policy) can be extended to include the following ‘Add on’ covers:following ‘Add on’ covers:

Removal of Debris in excess of 1% claim Removal of Debris in excess of 1% claim amount amount

Forest fire Forest fire

Page 90: Fire insurance

Add on Covers-ContdAdd on Covers-Contd

Deterioration of stocks in cold storage due Deterioration of stocks in cold storage due to machinery damage or due to insured to machinery damage or due to insured peril. peril.

Impact Damage due to insured’s own Impact Damage due to insured’s own vehicle. vehicle.

Start-up Expenses Start-up Expenses

Page 91: Fire insurance

Add on Covers-ContdAdd on Covers-Contd

Spontaneous Combustion Spontaneous Combustion

Omission to insure additions, alterations or Omission to insure additions, alterations or extensions extensions

Earthquake (Fire & Shock) Earthquake (Fire & Shock)

Spoilage Material Damage cover Spoilage Material Damage cover

Page 92: Fire insurance

Add on Covers - ContdAdd on Covers - Contd

Leakage & Contamination cover Leakage & Contamination cover Loss of Rent Clause Loss of Rent Clause Architect, Surveyors and Consulting Architect, Surveyors and Consulting

Engineers in excess of 3% claim amount Engineers in excess of 3% claim amount Insurance of additional expenses of rent for Insurance of additional expenses of rent for

alternative accommodation alternative accommodation Temporary Removal of stock Temporary Removal of stock

Page 93: Fire insurance

How to calculate the premiumHow to calculate the premium

Premium rate is in per mille(1000)Premium rate is in per mille(1000) Policy is issued generally for 1 year.Policy is issued generally for 1 year.

Page 94: Fire insurance

Premium Calculation - ExamplesPremium Calculation - Examples

House & Contents (how to calculate premium)House & Contents (how to calculate premium) Fire policy rate – 0.50 per milleFire policy rate – 0.50 per mille Earth quake rate –0.10 per milleEarth quake rate –0.10 per mille Value of building-Rs. 10,00,000/-.Value of building-Rs. 10,00,000/-. Premium for the buildingPremium for the building 10,00,000 X 0.50/1000 = 500/-10,00,000 X 0.50/1000 = 500/- 10,00,000 X 0.10/1000 = 100/-10,00,000 X 0.10/1000 = 100/- Total premium = Rs 600/- + TaxTotal premium = Rs 600/- + Tax

Page 95: Fire insurance

Premium Calculation - ExamplesPremium Calculation - Examples

Shop (Buiding’s Rate – 1.8+0.1, Shop (Buiding’s Rate – 1.8+0.1, Stock/Contents – Stock/Contents – 2.8 + 0.1)2.8 + 0.1)

Building Premium including EQBuilding Premium including EQ Rs 500000/- X 1.9/1000= Rs 950/-Rs 500000/- X 1.9/1000= Rs 950/-

Contents PremiumContents Premium Rs 1000000X2.9/1000 =Rs 2900/-Rs 1000000X2.9/1000 =Rs 2900/-

Total =3850/- + taxTotal =3850/- + tax

Page 96: Fire insurance

Fire Insurance-ClausesFire Insurance-Clauses

Important ClausesImportant Clauses

Designation of Property ClauseDesignation of Property Clause

Insurers agree to accept the designation under Insurers agree to accept the designation under which the property has been entered in the which the property has been entered in the insured’s books. If there is a property which is insured’s books. If there is a property which is named differently or insured has given some name named differently or insured has given some name to it, we will accept the nomenclature of the same to it, we will accept the nomenclature of the same property as given in the insured’s books. property as given in the insured’s books.

Page 97: Fire insurance

Fire Insurance – Clauses (Contd)Fire Insurance – Clauses (Contd)

Example- Designation of Property ClauseExample- Designation of Property Clause

An air conditioner is named as Plant & Machinery An air conditioner is named as Plant & Machinery in the books of insured when generally it is a part in the books of insured when generally it is a part of appliances. In such cases there will be some of appliances. In such cases there will be some confusion at the time of loss & claim settlement. confusion at the time of loss & claim settlement. To avoid such confusions and disputes, if insured To avoid such confusions and disputes, if insured has opted for designation of property clause, we has opted for designation of property clause, we will accept the name he has given to it as per his will accept the name he has given to it as per his books. books.

Page 98: Fire insurance

Fire Insurance – Clauses (Contd)Fire Insurance – Clauses (Contd)

Agreed Bank ClauseAgreed Bank Clause

If insured property is financed or hypothecated If insured property is financed or hypothecated by / to a financial institution an agreed bank clause by / to a financial institution an agreed bank clause is taken. The policy is taken in the name of the is taken. The policy is taken in the name of the Bank and all information provided to the bank will Bank and all information provided to the bank will be considered as delivered to the insured. At the be considered as delivered to the insured. At the time of claim, bank will receive the claim amount. time of claim, bank will receive the claim amount.

Page 99: Fire insurance

Fire Insurance – Clauses (Contd)Fire Insurance – Clauses (Contd)

Reinstatement Value ClauseReinstatement Value Clause

If the sum insured is fixed on the basis of reinstatement If the sum insured is fixed on the basis of reinstatement value, this clause is to be taken. value, this clause is to be taken. Under this the sum insured is based on reinstatement Under this the sum insured is based on reinstatement value/ replacement cost. value/ replacement cost.

No depreciation is deducted from assessed loss at the time No depreciation is deducted from assessed loss at the time of the claimof the claim

Under-insurance will however be applicableUnder-insurance will however be applicable Only fixed assets can be insured on reinstatement value Only fixed assets can be insured on reinstatement value

Page 100: Fire insurance

Clauses – ContdClauses – Contd

ARCHITECTS, SURVEYORS AND ARCHITECTS, SURVEYORS AND CONSULTING ENGINEER’S FEES (upto CONSULTING ENGINEER’S FEES (upto 3% of the claim amount) 3% of the claim amount)

REMOVAL OF DEBRIS CLAUSE (upto REMOVAL OF DEBRIS CLAUSE (upto 1% of the claim amount) 1% of the claim amount)

FLOATER CLAUSEFLOATER CLAUSE DECLARATION CLAUSEDECLARATION CLAUSE VOLUNTARY DEDUCTIBLE CLAUSE VOLUNTARY DEDUCTIBLE CLAUSE

Page 101: Fire insurance

Escalation clauseEscalation clause The escalation clause allows the client for regular The escalation clause allows the client for regular automatic increase in the Sum insured throughout the automatic increase in the Sum insured throughout the period of the policy provided certain conditions are met period of the policy provided certain conditions are met by the insured: by the insured:

Automatic increase in Sum insured against advance Automatic increase in Sum insured against advance Maximum increase should not exceed 25% of the sum Maximum increase should not exceed 25% of the sum

insured insured 50% premium of the final rate should be paid in 50% premium of the final rate should be paid in

advance advance This clause is available for a policy covering building, This clause is available for a policy covering building,

machinery and accessories only and not for stock covermachinery and accessories only and not for stock cover

Page 102: Fire insurance

Underwriting ConsiderationsUnderwriting Considerations

Nature/Type of Risk Nature/Type of Risk

Manufacturing, Godowns, Shops etc Manufacturing, Godowns, Shops etc

Location of Risk Location of Risk

Earthquake zone, Geographical, Social Earthquake zone, Geographical, Social Hazards etc Hazards etc

Page 103: Fire insurance

Underwriting Considerations Underwriting Considerations (Contd)(Contd)

Age of the Risk Age of the Risk How old is the machinery, building and all other How old is the machinery, building and all other property property

Past Claim Record Past Claim Record What amount against premium paid, type of accidents What amount against premium paid, type of accidents etc etc

Frequency of Loss Frequency of Loss At what interval and how often the claim is taken? At what interval and how often the claim is taken?

Page 104: Fire insurance

Key points of the Fire PolicyKey points of the Fire Policy

Full premium to be paid in advance Full premium to be paid in advance Minimum premium of Rs 100 except Minimum premium of Rs 100 except

Section III risks and tiny sector industries Section III risks and tiny sector industries where the minimum premium is Rs 50 where the minimum premium is Rs 50

Full property is to be insured-partial Full property is to be insured-partial insurance is not allowed insurance is not allowed

Policies are usually issued for 12 months Policies are usually issued for 12 months

Page 105: Fire insurance

Key points-ContdKey points-Contd

In case of policy cancelled by the;In case of policy cancelled by the;

Insurer-Premium refund on pro-rata basis for the Insurer-Premium refund on pro-rata basis for the unexpired period unexpired period Insured-Premium refund on short-period basis for Insured-Premium refund on short-period basis for the unexpired period the unexpired period

Mid Term revision of Sum Insured is allowed Mid Term revision of Sum Insured is allowed a) Increase in Sum Insured-On pro-rata basis. a) Increase in Sum Insured-On pro-rata basis. b) Decrease in Sum Insured-Refund on short b) Decrease in Sum Insured-Refund on short period basis.. period basis..

Page 106: Fire insurance

Key Points - ContdKey Points - Contd

Silent Risk-where there is no Silent Risk-where there is no manufacturing/storage activities are not carried manufacturing/storage activities are not carried out continuously for 30 days or more. out continuously for 30 days or more. The premium for a silent risk rate is Re 1.00 mille. The premium for a silent risk rate is Re 1.00 mille.

Rating of risk in multiple occupancy industrial Rating of risk in multiple occupancy industrial estate shall be rated ”per se”. estate shall be rated ”per se”.

In terms of Long term policy for Dwellings, the In terms of Long term policy for Dwellings, the long term discount is not applicable on earth-long term discount is not applicable on earth-quake rate. quake rate.

Terrorism is not an automatic cover, it is now an Terrorism is not an automatic cover, it is now an add on cover. add on cover.

Page 107: Fire insurance

Claim ProcessClaim Process

Intimation of claim with estimate of loss to Intimation of claim with estimate of loss to be given to the insurance companybe given to the insurance company

Claim form duly FilledClaim form duly Filled Appointment of Surveyor Appointment of Surveyor Photographs, Surveyor Report, Fire Brigade Photographs, Surveyor Report, Fire Brigade

Report, Police Report and Meteorological Report, Police Report and Meteorological Report Report

Page 108: Fire insurance

Claims Process - ContdClaims Process - Contd

Detailed Claim Bills with supporting Detailed Claim Bills with supporting documents documents

Copy of Internal Enquiry report on the Copy of Internal Enquiry report on the cause of the loss cause of the loss

Final file scrutiny is done Final file scrutiny is done If claim is admissible, cheque is dispatched If claim is admissible, cheque is dispatched

to the customer to the customer