1) Bibhash Roy is seeking fire insurance for closing stock estimated at 71,000 under an insurance policy. 2) The document outlines the types of property that can be insured against fire loss, the causes of fire loss covered, documentation required to submit a claim, and types of fire insurance policies. 3) It provides a sample claim calculation showing estimated stock loss of 58,000 and a claim amount of 32,676 based on policy limits.

1. 25/07/2015
UNDER
THE INSURANCE ACT,
1938
BIBHASH ROY
Bibhashroy94@gmail.com

2. INSURANCE AGAINST LOSS
DUE TO FIRE.
A fire insurance policy involves an insurance
company agreeing to pay a certain amount
equivalent to the estimated loss caused by fire
to the insured, within the time specified in the
contract.

3.  Any person or firm that has a financial interest in
the property to be insured can avail this
insurance. This means that owners of property,
firms that holds property in trust or on
commission and Financial Institutions which have
a financial interest in a property can avail this
insurance

4. 1) Building
2) Electrical installation in buildings
3) Machinery, Plant and equipment
4) Goods ( raw materials, stocks in process, semi finished, finished
etc ) in factories
5) Godowns, Goods in open
6) Contents in dwellings (Household)
7) Shops, Hotels etc.
8) Furniture, fixture and fittings, pipelines located inside or outside
the compound etc.

5.  Loss Due to fire cause by-
Earthquake
Attach of foreign enemy
Civil strife (war)
Mutiny (Pub. Vs Govt.)
Military rising
 Loss caused by subterranean(Underground) fire
 Loss caused by burning of property by order of
any public authority

6.  Selection of insurer. (Company)
 Presentation of proposal in the prescribed
form.
 Evidence of goodwill.
 Recommendation by agent.
 Survey of the subject matter.
 Report by surveyors.
 Acceptance of proposal.
 Depositing of premium money.
 Issue of cover note.
 Issue of insurance policy.

7.  Narration of how the premises is occupied
and what processes are carried on in the
premises.
 If there is any hazardous process carried on
in the premises
 Information on past losses (if any) .
 Information about refusal by other co.

8. • Copy of the policy
• Survey report
• Claim form duly completed by the insured
• Police report (for riot claims) / Panchanama (fire loss)
• Fire brigade report
• Meteorological report (in case of flood, cyclone etc. claims)
• Photographs
• Detailed claim bill with necessary bills / voucher
• Copy of enquiry committee report on cause of loss if
enquiry is ordered by insured.

9. Types
of
Fire Insurance
Policy

10.  In this policy the cover is a fixed amount agreed upon at the time of
signing the contract.
 The insurance company pays that amount apart from of the actual
loss due to fire.
 The insured is benefited when the market value of the property
declines , but suffer loss when the market value appreciates.
 It is also known as insured policy.
 The valued insurance policy is usually offered for such items like
jewellery, furs, or paintings, which value is difficult to estimate
once they are damaged or destroyed by fire.

11.  Covers the cost of replacement of object according to
its condition
 Any technical improvements will go to the account of the
insured.
 Reinstatement must be carried out by the insured in order to
obtain the benefits of the special basis of settlement.
 The work of reinstatement must be completed within 12
months from the date of loss, failing which the claim will be
settled on market value basis.
 The insured also needs to pay higher rate of premium.

12.  It is taken out for those goods which are frequently
changing in a warehouse. This policy can be taken on those
goods which are lying on different localities or godowns.
 Since quantity of goods lying in the warehouse or at
different places fluctuate from time to time, it becomes
difficult for the owner to take a specific policy.
 Floating policies are suitable to those traders or products
whose raw-materials or merchandise are lying at different
localities or godowns.
 For example:-Some of the goods of other trader are kept in
one godown, and few kept in another godown, some kept
in the railway godown or some at the sea port open. To
cover the risk of goods lying at different places under one
policy.

13.  It is issued for existing stock.
 In this policy premium rate shall be adjusted
according to increase or decrease in the
value of stock, this change will be notified to
the insurer by the insured.
 In case of loss by fire, the amount notified by
the insured at the maturity of the policy is
taken as final and indemnified up to that
limit.
 It is a contract limited to merchandise or
stock in trade other than farming stock

14.  A specific policy is a type of policy in which the
property is insured for a specific sum irrespective
of its value.
 If there is loss, the stated amount will have to be
paid to the policyholder.
 But the actual value of the subject matter is not
considered in this respect.
 For example, if a property is insured for Rs. 10000
though its actual value is Rs. 20000. In the event
of loss to property, not more than Rs. 10000 can
be recovered.

15.  Fire insurance provides advantages to
the enterprise in the following ways
 Loss of life
 Machines security
 Medical expenses
 Fire insurance provides the advantages
for the homeowner in these ways
 property security
 Any damage recovery
 Electronic part security

16.  Provide payment
 Help to businessman

17. Particulars Amount
Estimated Value of Closing Stock as on the date of
fire(15/07/2015)
71,000
Less: Salvage Value of stock 13,000
Estimated value of stock destroyed by fire 58,000

18.  Calculation of claim Amount
 Average clause=
 Value of stock destroyed X Value of
Insurance Police
 Value of stock on date of fire
 58,000 X 40,000
 71,000
 =32,676

19. PROPOSAL FORM FOR FIRE INSURANCE
Full Name of the Proposer :
Relationship with the Proposed Insured:
Name in which Insurance is
to be effected :
Address : ………………………………………………………….
…………………………………………………………..
Phone No.: Fax No.:
Trade/Profession/Occupation: Residence / Office / Trading / ……………………..
Insurance PERIOD required FROM……………………….. TO………………….
THE PREMISES :
LOCATION 1 LOCATION 2
a) Building / Shop / Warehouse No :
b) Flat No. (if applicable)
c) Name of Land lord/Landlady :
d) Plot No.
e) Name of Street
f) Area Name / Town
g) District / Emirate

20. j) If adjoining,whether the dividing wall
Is a perfect party wall at least 13 inches YES / NO YES / NO
Thick carried through at least one foot
Above the roof having no openings
l) Whether there is any wooden inter –
Mediary floor exceeding 10% of YES / NO YES / NO
YES / NO
Total floor space
CONSTRUCTION
m) No. of storeys
n) Walls
o) Roof
p) Adjoining Buildings
q) Buildings within 50 feet
r) If any bldg. Is within 50 feet is kutcha
are the Walls facing such kutcha Bldg YES / NO YES / NO
built of Bricks/Stone and have no
openings
OCCUPATION
s) Ground Floor
t) First Floor
u) Upper Floors
v) Adjoining Buildings
w) Is Trade / Manufacture carried on
In the building
If YES state nature

21. GENERAL INFORMATION
1) How long have you been carrying on this business :
2) Name of your Banker(s) & Branch
3) IS THE POLICY TO BE ENDORSED IN
FAVOUR OF ANY BANK(PL. SPECIFY)
4) Are the stock books kept in Fire proof safe : YES / NO
5) If not what precautions are taken to prevent
The stock books from being destroyed by Fire
6) Do you keep a duplicate set of stock books in
Other premises
7) Are there any existing insurance on the same
Property with this or any other Office
8) Are there any circumstances which appear to
Increase the risk ? If so please provide details
9) Has any office for reasons whatsoever(a) declined
(b) cancelled OR (c) refused to renew any policy
on this or any other risk of yours (Pl. provide details)
I / We hereby declare that the above information is true and correct to the best of my
knowledge and information and I/We have not deliberately or intentionally with-held
herein any material information that could have a bearing on the acceptance or
otherwise of this proposal. I / We further agree that issuing or submitting proposal
form does not bind either Alliance Insurance P.S.C. to provide terms or to accept cover
or me / us to insure the risk with Alliance Insurance P.S.C. How-ever if the insurance
is effected with and by Alliance Insurance P.S.C. this proposal shall be the basis of the
contract between me / us and Alliance Insurance PSC.
Signature of the Proposer…………………………
Agency : Date
===============================================================
ALLIANCE INSURANCE P.S.C. , P.O. Box 5501 , DUBAI (U.A.E.)

22. 1. Life Insurance corporation of India(LIC)
2. Bajaj Allianz General Insurance
3. ICICI PrudentialLife Insurance
4. ICICI Lombard General Insurance
5. BirlaSun LifeInsurance
6. TataAIGGeneral Insurance
7. NewIndiaAssurance Co.
8. Iffco TokioGeneralInsurance
9. Oriental Insurance Co.
10. HDFCStandardLife Insurance

23. INSURED
PERSON
INSURER