MAJOR TYPES OF FIRE POLICIES

 

COMPREHENSIVE POLICY: Covers risk like theft, third party risk, loss of profits during  business closure  due to fire, breakdown  of machinery, electronic  equipment, boiler explosion  etc.,  Presently this policy is issued for a maximum overall cover of Rs. 100 crores. Under this policy  Business Interruption  cover or Loss of profit or Consequential  loss is available  as an option.  For the purpose  of deciding the sum assured, the business  turnover is grouped  as a Variable  Charge   and the Fixed  or standing charge. The sum assured for this purpose  represent  the Gross Profit,  which  is the sum total of the Net profit and the standing charge. In addition  the insured is also required to specify  the period up to which the cover will  be required.  DECLARATION POLICY: The policy is useful  for the business where the stock is subject to  frequent   and or/ value of the stock. The insurance company  may prescribe  a certain  Certain minimum sum assured m which at present  is Rs. 1. Crore in one or more locations and not less than  Rs. 25 lakh  in at least one of these locations. The basis for the declaration of value is the market value of as agreed upon between the contracting  parties, and the reduction sum assured is generally not permitted. A refund  arising out of cancellation or declaration shall not exceed 50% of the total premium. Monthly declaration based on any day of the month or the average of the highest  value at risk on each day is received by the insurer within the stipulated time, then the full sum assured under the policy may be deemed to have been declared and the full premium be charged.  FLOATER (FLOATING) CUM DECLARATION  POLICY:

Combines  the features  of the Floating  and Declaration  policies  subject to stipulation  on minimum sum assured  and premium retention percentage  by the insurer.  FLOATER (FLOATING) POLICY:  Covers property located at  different locations and is subject to the Average clause, which is a penal provision in some general insurance contractors  for under-insurance. In the event of a  claim, the claim is settled by the dividing  the sum insured by the actual value of the property., And multiplying  the product by the actual loss. The premium is related to the rate applications  to the highest value of the stock at any location with a predetermined percentage as loading.  REINSTATEMENT VALUE POLICY:  The policy is designed to meet the cost of reinstating the property of the same type of as the one lost by building  or of fabricating  new property. If such a reinstatement  result in any gain to the insured , the insured is obliged  to bear a part of the cost for such  replacement according to the doctrine of indemnity. If need  be, the policy can be extended  to cover statutory costs towards reinstatement  in addition to the actual  cost of  reinstatement by including such costs in the sum assured. An  interesting  case that could be cited is that of the claim on the world trade after the September 11 attack, of 2001, Larry Silverstein, the lease holder of the property, had at time of proposing  the cover declared the vale of the WTC, including  business interruption  to be $ 5 billion but opted  for a cover of  $ 3.5 billion. Obviously  any higher claim was not admissible  . Person partners  an independent  real estate valuer, had value  the WTC complex, at $2.16 billion under the  Wills property form, the contract by which the claim were made. Swiss Re stated that Silverstein’s  only options  was to disclaim intention to rebuild the WTC and seek replacement cost value proceeds up to the policy limit  of $ 3.5 million. The estimate for rebuilding was assumed to slightly  less than $ 300 per square foot, and on this estimate the replacement  value of the property approaches the policy limit  of $3.5 billion.,  SPECIFIC POLICY:  Covers loss only  up to a specific amount. VALUABLE  POLICY: Under this contract  only a  cover against the fire loss is given. The extent of loss is  determined  after the happening  of the event and the valuation  is on the basic  of the market value of the property.  VALUE POLICY: Under this plan., Only a  fixed amount. Irrespective of the loss, is paid, The compensation is restricted to the actual  loss subject to the maximum amount of the insured value, irrespective of the market value of the property.

PERSONAL ACCIDENT INSURANCE

There  are different  types of accident  covers,  accident including  some special  types of covers.  It was not until  the middle  of the nineteenth  century that a  beginning  was made for insurance against bodily  injury. The earliest  companies  to undertake  this type of insurance were especially concerned  with  railway  accidents. This limitation  did not  last song  and within  a few year  the accident  insurance railway accident   insurance companies were offering  insurance against only death  but also  bodily injury from any  accidental  cause. The first company to sell accident  insurance to those policies was the one charted  in 1848 by the British Parliament  to sell  travel insurance to those who travelled  by train. The first  accident  insurance company  of the  US the, Travelers  insurance company founded  by James C batter son of Hartford in 1864, Connecticut was   issuing  policies to US railroad  passengers.  Nowadays, many institutional  offer Personal  Accident  policies  as a measure  of sales promotion  . These  are limited cover accident policies issue  under a blanket cover by the  banks or clubs issuing credit  credit  cards to the clients. Depending  upon the class of the card , the value of the cover also differs, In India, many credit  cards offer accident cover to  their cardholders  . Of late, many  marketing  organizations  also offer personal accident   policies with certain  conditions  . For example if someone  purchase a scooter  tyre, the tyre company that has a  tie-up with a   general insurance company  may offer a personal  accident  policy to the buyer of a particular of brand of tyre.  This  apart, some TV

apart . Some TV channels  to popularize the channels  promote  clubs named offer  after the channel and offer free accident insurance cover to members. In  the United States of America , some publication  offer such covers to their  subscribers  and such policies are called “News paper  Policies” If  one has to go by the report the “Dhoti policies”  could  well be the Indian counter part  of the Newspaper  Policies   of the USA . It  is reported  that MCR textiles  a dhoti manufacturing  company in Erode, Tamil Nadu, had tied up with ICICI Lombard  for the offer of free personal accident coverage  to all those  who buy a Mundu (dhoti)  in the State of Kerala. A Novel promotional  method  indeed!.  One’s  decision to purchase an insurance  because the cover is given as a free add on to some other primary purchase  or by availing  of a service. As it is said that are no free launches, one should remember that many such free offers  are not really  free: they come with various  types  of strings attached.  Until  the time of the opening up to the insurance to the private sector. The accident insurance policies in India  were issued by the state-owned  insurance company,. Viz., New India assurance Company United India insurance Company , Oriental  insurance company  and Nation al insurance company.  In addition to the pure  accident policies offered by the nationalized general insurance company  life insurance policies issued  by LIC some of its select tables  contained  the accident  insurance benefits  as an add-on benefit or as an in built one.  After the industry  opened up many private  sector companies  like Bajaj Allianz  General insurance Co. IFFCO-Tokio General insurance company , Tata Aig insurance company  , Royal Sundaram General insurance company,. Cholomandalam MS general insurance company  and ICICI Lombard offer such covers.  The terms of offer and the benefits may very from company to company and therefore the information, given in this pages is of general nature and not specific  to any company or plan.,

The discussions   of life a re about the board framework  within  which the personal accident policies are issued , and are issued , and are based mainly on the practice  of the nationalized  general insurance

sector in India.  RISK GROUPS  CATEGORIZATION:  In a contract   of life insurance , it is possible to decide the premium based on the mortality  group to which  the proponent  or the life to be insured belongs .  But in a  contract of personal accident insurance, it is difficult  to evaluate  the risk factor  for each proponent  and fix the premium. For this purpose, the proponents  are grouped into a  different categories.  RISK CATEGORY I: This category  covers people who are exposed to very  few accident due to the nature of their  work. For this category the probabilities  of work-related  accidents are almost negligible  . The groups  includes  mainly white collar workers, managers ,  doctor, engineers, financiers , accountants writers, consultants  et al., RISK CATEGORY II:  This category  includes  drivers licenced  to drive  heavy  vehicle  employees  in a motor  garage, including  care mechanics, machine  operators  workers  engaged  in the operation of various  machines  as a part of their  occupations  professional  sports person  and athletes, person carrying  cash to different  destinations from an office or an organizations  and vice versa.  In additional  to the above the group also  includes chauffeurs , builder including contractors  and engineering  engaged in supervising  construction work and person on a similar  footing a as a supervisors  without  engaging in manual  labour.

TYPES OF MARINE LOSSES

In view of the various marine perils discussed above, the ship owner and the cargo owners will have to incur huge amount of the losses. Those losses can be claimed from the insurer only when the cause of the loss is an insured peril, If otherwise , obviously  it does not come within the scope of the policy and the insurer is not liable to make good the loss. In theory, it seems to be a simple rule that the insurer is liable for losses caused   by insured  perils only, but in practice  the determination  of the actual cause of the loss poses a huge problem. The main difficulty  arises  when this loss is caused by the operation of several contributory  causes or a chain of causes. In such a situation  the principles  of cause proxima  is applied  for determining  the scope of insurer’s  liability.  The losses incurred by the ship owners  and the cargo owners are summarized  in the following .  

 (1) TOTAL LOSS; The completed destroying or ruining  of the property insured is called total loss. In order  when the subject matter insured or the goods are totally  lost or completely  destroyed  , there is total loss. For example  id the risk of collision is inured  and the ship is totally destroyed  the insured can realize the total loss from the underwriters. According  to Section 68 of the Marine  insurance Act 1964, Subject to the provisions of this Act and to any or and to any express provisions in the policy  , where there is a total loss of the subject matter insured 

  (1) If the policy  is a valued policy, the measure of indemnity  is the sum fixed by the policy 

(2), If the policy be an un valued policy, the measures  of indemnity  is the insurable  value of the subject matter insured. The total  loss is subdivided into a  two groups viz,. deprived of the possession  of the subject matter, it is called actual total loss.   

(1) The subject matter is completely destroyed  e. g.  a ship has sunk in deep waters and neither the ship nor the cargo on board can be recovered  or the ship caught fire in the which ship  and the cargo were damaged beyond repair. 

  (2) The subject  matter is so damaged  as to cease to be a thing of the kind insured.  Here, the subject matter is not completely  destroyed but damaged to such an extent  as the result of the mishap,. For example a ship might get ashore  and heavy waves might strike against  her and smash her to pieces  or where the crockery or glass ware is reduced  to pieces and is unfit for use a as such.

  (4).  The subject  matter is lost. For example, where a ship missing for a very long time and no  news of her is received I, e. nothing is heard about the ship after she left the shore even after due search an actual total loss is presumed unless there is some other proof to show against it. In case of actual total loss the insured  is entitled to recover full amount of loss. But after receiving  the compensation , the title of goods passes on to the insurer. If arrangements  are made to send another ship to save and bring it back and repair it, the total expense  involved will be greater than the value of the ship so damaged . In this case, the ship may be abandoned and will be deemed as a constructive  total loss. The constructive  total loss will be there

EAT RIGHT STAY FIT THIS MONSOON

The monsoon is such a welcome respite  from the scorching  summer thanks  to the overcast sky, gently rain and lush greenery all around. Almost all of us love to savour spicy anc crunchy  food items such as a fritters pakoras  and chaats like Pani puri , sev puri, teamed with cutting chai as the rain water  lashes against the window pane. However  the season also brings along a host of the diseases such as a dengue, viral fever,  conjunctivitis, thphoid, viral fever,  pneumonia, gastrontestinal  disturbances, diarrhoea, food poisoning  cough and cold and jaundice due  to bacteria in the environment.  The challenge  lies in going about your   daily routine without falling ill. If you suffer  from low immunity you  are at a higher risk of a  contracting these diseases  . However the right  dietary tips can strengthen  your  immunity and help you stay hale and hearty. 

  STAY WELL-HYDRATED:  Due to the humaid climate, you may not feel too thirsty and consume just one litre of water every day . But you need  to be well hydrated as sweat  does not  evaporate quickly in monsoon . Consequently, this prevents  the body  from releasing heat. So consume a lot of  water as a it helps to flush out toxins  from the body. Ensure  that the water is clean, pure and safe to drink. Avoid aerated drinks: instead consume  warm beverages such as a green tea with holy basil  leaves, ginger  pepper and honey as they have anti-bacterial properties. A bowl of hot vegetables soup is also a good options. The hot beverages will increases  your body  temperature  which will in turn give you warmth while the ingredients will boost your immunity. 

 SWITCH TO A BALANCE DIET:  Consume fruits such as cherries, bananas,  apples, pomegranates, plumps, litchis  and pears as they are packed with anti-oxidants  and are rich in vitamin  A, E, C  and minerals . Vegetables such as a cauliflowers  , potatoes , cluster  beans, lady’s finger, kidney beans, pigeon pea and  sprouted grains get spoilt easily  due to the humidity: . So they should be  avoided  . Opt for cooked or steamed   veggies. Avoid  salads as they comprise raw vegetables that contain active  bacteria which lead to various infections and affect the body’s  immunity. Avoid strong  smelling or extra sweet fruits such as a mangoes and jack fruits that attract flies as their  excess intake can cause  skin irritation and stomach ache.  It is also important to store  vegetables that right way during  the rains. Do not wash the veggies  throughly  before storing  as the moisture  will attract  pathogenic fungus. These bacteria can spread to other susceptible food items as well, making them  unhygienic . Instead pat dry and store  separate food items in different containers  . Buy them in limited portions and use them as soon as possible.

MAINTAIN YOUR TRESSES/:  Dehydration makes your hair brittle  and scanty. So hydrate yourself. Zinc and iron help to keep your  tresses healthy and beautiful . Consume  nuts, eggs and walnuts to maintain  hair strength. Walnuts are rich in biotin and vitamin E, which are excellent antioxidants . Proteins are important  for hair strength  too. So add cur to your diet, as it is a great source  of protein. Amla juice oranges and other citrus  foods are rich in vitamins C. Vitamin C keeps your hair strong  as it helps in productions  of collagen that in amount other things strengthens  the hair capillaries (ensuring proper nutrient supply to our hair). Also,  ensure that you  wash your locks on alternate  days and cover them well during the monsoon. Dried  apricots roasted  sunflower  seeds and lentils are better foods to consume  during monsoon than other iron-rich foods which are susceptible to  microbial  attack. Do not forgot to eat  yummy corn on cobs as corn is also rich in iron and zinc.  So the secret  to enjoy  the rains, without the fear of affecting  your health is to go light on eating . Have a safe and healthy  monsoon

DEBT FUND INSTRUMENTS

 Interest  rates are on their way down., When rates fall prices, or the value of the debt assets rises. Debt mutual  funds (MF) have therefore come to the fore front of retail  investors . In debt MF scheme  your funds are deployed primarily  in fixed income instruments . There  is no exposure  to the volatile  asset like quities. The  objective of debt  MF scheme  is to generate  steady  returns while preserving  your capital  thus providing high safety  to your principal . Talking   of risk of capita l  invested  in them. The volatility  in its NAV is less compared  to equity  funds.  Debt funds also known is as income funds are funds that invest strictly in debt related  securities . The reason for them being  less volatile in returns is the underlying  securities  in them.  Most common  constituents  of debt  MF are bonds  debentures  fixed deposits  state and central government  securities  commercial paper, treasury  bills,  call-money, market and certificate  of deposits.

 VARIANTS:  Floating  rate funds: They invest mostly in  floating  rate instruments i. E. Is debt securities  whose coupon Rate adjust according to change in benchmark interest rates. The coupon changes  its, price does not Gilt funds. They invest only in debt instruments  issued by the  government  namely T-bills and G-secs, .The government  guarantee means that the they carry  zero default  risk, which explains  the term  gilt., The zero possibility   of default  means  they offers  slightly  lower  returns  than corporate  paper, which  bears an element  of risk. Gilt funds can be categories  into long -terms  plans and short -term plans. Between the two, long-term plans, on paper offer greater returns  , but at a higher level  of risk.

LIQUID FUNDS:  While  in come funds  and gilt funds are gilt funds  are debt  options for the medium to long terms . Liquid funds cater to the short term i. E  an investments  horizon  of up to the one year. Liquid funds invest in high safety financial instruments  whose tenure  ranges from a day to a year, issued by the governments  (T-bills) banks  (certificate paper and debentures.).  These are called money  market instruments , which is why liquid funds are  also  referred to as a money market mutual funds. Since money market instruments  are the at the short end of the tenure  scale,   returns from liquid  funds are relatively stable.

 HOW THEY EARN:  Similar  to the interest  that a bank fixed  deposit gives  during its tenure debt  founds  funds  also earn a  regular interest from the fixed income  securities  that they are invested  in. In additional   debt funds buy the debt instruments  at a certain price and then sell them. The differences between  the cost and sale  price accounts  for the appreciations  or depreciations  in the fund’s  value.

 HOW NAV MOVES:   A debt instruments  market price depends  on the interest rates of the its underlying  assets  and also on any upgrade  or downgrade in the credit  rating of its holdings. Market  prices of debt securities swing the with movement in interest rates. Let’s  assume your debt  fund, owns a security  that yields  10 per cent interest . If  interest rates in the economy  fall, new instruments that hit the market would  reflect the changed interest rate scenario  and offer lower interest rates. This would result in an increase in your funds, instruments price as the higher yield would the raise the instruments value. As a result of the increase   in the debt instruments value , your fund’s  NAV would also rise.