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Fire Insurance
This policy offers protection against loss or damage of property/
materials caused by fire. The insurance should be taken for a
maximum amount
of its current value after considering factors of wear and tear as
well as depreciation.
Suitable
This policy is vital for every individual or corporate
body with respect to the property where they have insurable interest.
Since
insurable interest signifies the right to insure, the person or corporate
body must be legally competent to enter into a fire insurance contract.
Policies A and B are intended for householders,
office establishments, hoteliers and shopkeepers.
Policy A is also ideal for small manufacturing units and cottage-scale
industries.
Policy C is apt for industrial/ manufacturing concerns as well as
warehousing establishments.
All these policies can cover the interests of
banks and financial institutions.
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Perils Covered |
Policy |
Fire, lightning, explosion/ implosion |
Covered under all 3 sections |
Riot, strike, malicious, terrorist damage, impact, aircraft damage |
Can be excluded from Policies B and C, and discount in premium
availed |
Flood, storm, tempest, subsidence, landslide, earthquake, fire,
shock |
Covered only under Policy A, but on payment of additional premium
can be covered under Policy C |
If additional premium is paid,
then extraneous perils like deterioration of stocks due to power
failure, leakage and contamination, sprinkler leakage, spoilage
of material, subterranean fire, forest fire, missile testing operations
can also be covered.
Compensation Offered
The policy pays for cost of repairs replacement/ reinstatement of
the item lost/ damaged based on actuals.
However, the market value of the item lost and the adequacy of the
sum insured will govern the settlement.
Where buildings, plant and machinery are covered on a reinstatement
value basis, the "Cost When New" of the building, plant
and machinery erected on the same site would be the basis.
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Exclusions
The policy will not pay claims arising from
- Theft during or after the occurrence of any insured peril.
- Any
heating / drying process.
- War or nuclear perils.
- Electrical breakdowns.
- Ordered burning by a public
authority.
- Subterranean fire.
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Loss or damage to bullion, precious stones,
curios (Rs.10,000/-), plans, drawings, money, securities,
cheque books, computer records unless specifically included.
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Loss or damage to property
moved to a different location (except machinery and equipment
for cleaning, repairs or renovation for more than 60 days).
Under policy A, mere cracks without collapsing of whole or
part of the building are excluded.
Under policy C, curios valued at more than Rs.2,500/- cannot
be claimed for and the first Rs.10,000/- of any specific loss
is not payable either.
Also, loss due to natural heating, spontaneous combustion,
fermentation as well as damages to goods held in trust or on
commission are not payable under policy C.
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