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.
