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Consequential Loss(Fire) Insurances

Consequential Loss(Fire) Insurance

Introduction:

Take Control of your business's destiny with the help of SBI General Insurance:
Life is full of surprises. Some are pleasant and some are not. Disasters like Fire and special perils can put a break in your growth plan.They also put huge financial burden on you. SBI General Insurance can help successfully overcome these situations and put you firmly in control of your business.
SBI General Insurance can help successfully overcome these situations and put you firmly in control of your business. With SBI General Consequential Loss (Fire) Insurance Policy, you can now safeguard your business profits against possible loss due to business interruption.
Insurance policies generally cover the costs of repairing or replacing damaged property. But, the financial loss suffered due to an interruption in your business operation is not covered under these material damage policies - you need a Consequential Loss policy.
SBI General's Consequential Loss (Fire) Insurance Policy offers the solution, by covering profit lost following an interruption to your business which inevitably results from damage to insured property. This Policy can be taken only in conjunction with a policy that insures your assets (such as an SBI General's Standard Fire and Special Perils policy), and triggers only if the loss is admissible under that policy.
Indemnity period - The indemnity period commences with the date of damage and lasts till such time as the business is restored to its pre-damage level or the end of the indemnity period is reached whichever comes first. A consequential loss insurance policy insures earnings end of the indemnity period is reached, indemnity period. Hence, selection of the indemnity period is of utmost importance

Scope

  • The scope and purpose of consequential loss insurance is therefore:
    • To make good the loss of net profit that results from a stoppage of business following loss or damage to your insured property.
    • To pay the standing charges which continue to accrue in spite of stoppage of business.
    • To pay the additional expenditure you may incur to maintain normal business activity, during the period in which the business is affected.

Coverage Details

  • Further, on payment of additional premium, the following coverages can be selected:
    • Supplier's extension
    • Customer extension
    • Failure of Public power supply/Gas works/water works
    • Spoilage Risk extension

Sum Insured

  • The Sum Insured is based on the gross profit of the business. Gross Profit is defined as the sum of Net Profit and insured standing charges.
  • Damage could occur at the very end of the period of insurance. In order to provide for an adequate Sum Insured, profit projection must be made one year beyond the Indemnity period. Thus if the indemnity period is 24 months, projections for the next three years should be considered in arriving at the Gross Profit figures.
  • Additional Items which can be incorporated as part of the Sum Insured,
  • Wages

Exclusions

  • The SBI General Consequential Loss (Fire) Insurance Policy does not cover any loss resulting from damage occasioned by or through or in consequence, directly or indirectly, of any of the following occurrences, namely,
  • Arising out of perils not covered under Standard Fire and Special Perils Policy.
  • War, Invasion, act of foreign enemy, hostilities or Warlike Operations (whether war be declared or not), Civil War.
  • Mutiny, Civil commotion assuming the proportion of or amounting to a popular-rising, military rising, insurrection, rebellion, revolution, military or usurped power.
  • In any action suit or other proceeding where the Company alleges that by reason of the provision of this condition any loss or damage is not covered by this Insurance, the burden of proving that such loss or damage is covered shall be upon the Insured.
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