Inclusions of a Standard Fire and Perils Insurance Policy:
The SFSP insurance policy, in general, provides coverage for the following:
- Fire
- Explosion/ implosion
- Lightning
- Aircraft damage
- Storm, flood, tempest, cyclone, hurricane, tornado, and typhoon
- Riot, malicious damage, strike
- Impact by any road or rail vehicle, or an animal belonging to a third-party.
- Landslide and subsidence including road slide.
- Overflowing or bursting of apparatus or water tanks.
- Leakage from the installation of the automatic sprinkler.
- Contamination or pollution resulting from any of the mentioned perils.
- Missile testing operation.
- Bush fire
- Any insured peril that is the result of any of the aforementioned perils.
Additional Coverages
- Surveyor, consulting engineer, and surveyor’s fees up to a specific percentage of the claim amount is included.
- All the expenses that are incurred to remove debris for cleaning the site up to a certain percentage of the claim amount.
- Equipment and machinery temporarily removed for repairs, renovation, cleaning, or another similar purpose for a specific period.
Exclusions of a Standard Fire and Perils Insurance Policy:
The expenses and losses that are not covered in a standard fire and special perils (SFSP) insurance policy plan are:
- Excess amount as defined in the policy.
- Contamination or Pollution
- Nuclear risks
- Damage, destruction, or loss to unset precious stones, bullion, works of art, securities, plans, drawings, money, and similar items.
- Destruction, damage, or loss to stocks in cold storage premises caused by changes in temperature.
- Damage, destruction, or loss to any fixture, apparatus, electrical machine or fitting caused by over-running, short-circuiting, excessive pressure, arcing, self-heating, or leakage of electricity (including lightning). This exclusion applies only to the specific electrical machine, fixture, apparatus or fitting affected, and not to other machines, apparatus or fittings that may be damaged or destroyed by the resulting fire.
- Loss, destruction or damage caused by war, acts of foreign enemies, invasion, hostilities or war-like operations (whether the war is declared or not), mutiny, civil war, civil commotion amounting to or assuming the proportions of a military uprising, popular uprising, rebellion, insurrection, revolution, or military or usurped power.
- Expenses necessarily incurred by the Insured for (i) Debris Removal and (ii) Architects, Surveyors, and Consulting Engineers' Fees following loss, destruction, or damage to the insured Property by an insured peril, in excess of 1% and 3% of the claim amount, respectively.
- Loss of market, loss of earnings, loss due to delay, or any other indirect or consequential loss or damage of any kind or description.
- Any loss or damage caused directly or indirectly by earthquakes, volcanic eruptions, or other natural convulsions.
- Loss or damage to insured property if moved to any building or location other than the one specified in the policy, except for machinery and equipment temporarily removed for repairs, cleaning, renovation, or similar purposes for a period not exceeding 60 days.
Properties That are Not Covered:
- Items such as unset precious stones or billions or work of art for a specific amount, manuscripts, drawings, plans, obligations, securities, documents or obligations of any kind, coins, stamps, paper money, books of accounts, cheques, or other books of business, records of a computer system, explosive manuscripts, etc.
- The stock of cold storage due to temperature change:
- Damage, loss, or destruction of any electronic or electrical machine fixture, apparatus, fitting arising from excess running, short-circuiting, self-heating, arcing, leakage of electricity due to any cause (including the lightning).
- Damage, loss, or destruction of boilers, vessels, or economizers, apparatus, machinery wherein steam is generated through its own implosion/ explosion.
Standard Fire & Special Perils: Add-Ons
With perils and the expenses covered in fire and perils insurance, you can as well get a cover concerning the following perils, expenses during the purchase of the policy or at the time of inception of the plan by paying an additional premium.
Perils Covered:
- Damage, loss, or destruction of property because of deterioration of stock available in the premises of cold storage because of power failure.
- Forest fire
- Spontaneous combustion
- Impact damage because of own vehicle of the insured, forklifts, and the same articles dropped from there.
- Forest fire
- Earthquake
- Damage cover for spoilage material
- Removal of stocks temporarily
- Contamination and leakage cover
- Terrorism
Expenses:
- Architects, consulting engineers, and surveyor’s fees
- Rent loss
- Removal of debris
- Expenses of start-up
- Addition accommodation expenses
SFSP: Sum Insured
The sum insured amount under the standard fire and special perils insurance policy can be used under the following conditions:
- You can get the insurance of your property as per its depreciation cost or based on replacement cost.
- For getting better protection, insurance on a replacement basis is suggested. The selected sum insured must be adequate for reinstatement.
- In case the property’s value may increase because of the factors such as exchange rate, increasing prime cost, etc. then at the time of policy purchase, the related sum insured can be increased by a specific percentage.
- In the same way, a reduction in sum insured during the purchase of policy can be effected for which premium refund is allowed based on a short period.
The Final Words!
The fire insurance policy and perils insurance in this way is a method to protect your property against any loss or damage due to various aforementioned reasons.
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