G Textiles Pvt. Ltd. Co. availed a Standard Fire and Special Perils Insurance Policy as per the standard format for factory building and machinery and also for stocks as given below. Insurance coverage for the building a

The term 'fire' is used in its popular and literal sense and means a fire which has 'broken bounds'. 'Fire' which is used for domestic or manufacturing purposes is not fire as long as it is confined within usual limits. In the fire insurance policy. 'Fire' means the production of light and heat by combustion or burning. Thus fire, must result from actual ignition and the resulting loss must be proximately caused by such ignition. Fire Insurance policy (Standard Fire and Special Perils Insurance Policy) is a specialized form of insurance that covers financial loss to insured for damage to its property due to Fire & other special perils. The popular name for this policy is Standard Fire and Special Perils or SFSP policy. Fire Insurance policy covers perils like Fire, Lightning, Explosion, Implosion, Aircraft damage, Riot, Strike and Malicious Damage (RSMD), Storm, Tempest, Flood, Inundation (STFI), etc. Any financial loss occurring due to damage to property of insured because of any of these perils will be indemnified by the Fire Insurance Policy (Standard Fire and Special Perils Insurance Policy). Insured can take Fire Insurance policy to cover its property, stock, plant & machinery, furniture & fixture, and specific items like bullion, drawings, coins, work of arts, etc. Following are the 12 perils of the standard fire insurance policy: Fire: Damage caused to the insured property/goods due to fire is covered under a fire insurance policy. However, this policy will not cover the property/goods against: Damage or destruction caused due to its own fermentation, Damage or destruction caused due to natural heating. Damage or destruction caused due to spontaneous combustion, Damage or destruction caused due to any heating or drying process. Burning of the insured property due to orders issued by the Public Authority. Lightning: Fire or any other damage caused to the property due to a peril like lightning is covered by the office fire insurance policy. Striking of a lightning can cause cracks in the building; such damage is also covered by this insurance policy. Explosion/Implosion: This policy protects against the loss caused due to explosion and implosion. A vessel can explode when its inside pressure reaches to or is more than the atmospheric pressure outside. Whereas, an implosion occurs when the external pressure is more than the internal pressure. Both of these phenomena can result in a fire. However, the fire insurance policy does not cover the loss, destruction or the damage caused to: Boilers Economizers or other vessels Machinery, apparatus or their contents generating steam The policy also does not cover the damage or destruction caused by centrifugal forces. Aircraft Damage: It covers the loss or damage caused by Aircraft, other aerial or space devices. Riot, Strike, Malicious Damage: The fire insurance policy in India covers the loss, visible physical damage or destruction to the property caused by external violent means. Riot, strike and malicious damage are caused by an intention of causing disturbance to the public peace. Storm, Cyclone, Typhoon and Flood: The violent destruction caused to the property or goods due to the above-mentioned perils are covered by all types of fire insurance policy. However, the policy does not cover for earthquake, volcanic eruption or other perils of nature under the standard peril list. The insured must ask the insurance company for an additional cover to get protection against the same. Impact Damage: Fire insurance policy covers claims arising from the damage or destruction caused to the insured property due to direct impact/contact by any rail/road vehicles or animals. However, it is important that such vehicles or animals are not owned by the insured, or any occupier of the premises or the employees in the course of their employment. Subsidence and Landslide including Rockslide: Subsidence means the sinking of the area on which the property is located, and landslide means the collapse of the mass of earth from a mountain or a cliff Fire insurance policy covers loss, destruction or damage directly caused by subsidence of part of the site on which the property stands or landslide and rockslide. However, it does not cover for damage or destruction caused to the properly due to: Demolition, repair, or structural alterations of the property or groundwork or excavations Coastal or river erosion Normal cracking or settlement of new structures Settlement or movement of made up ground Defective design or defective workmanship or use of defective materials Bursting and/or overflowing of water tanks, Apparatus and Pipes: This policy also covers for the loss or damage caused to the property by water due to the above-mentioned perils like bursting and/or overflowing of water tanks, apparatus and pipes. Missile Testing Operations: This policy also covers the damage or loss to the property due to any kind of missile testing operation. Leakage from Automatic Sprinkler Installations: Damage caused due to accidental discharge of water from a leaked automatic sprinkler installation is covered under this policy. However, it does not cover for the loss or damage caused due to: Repairs of alterations to the buildings Repairs, removal or extension of the sprinkler installation Defects in construction which is already known to the Insured Bush Fire: The policy covers for the damage caused due to the burning of bushes and jungles by Fire. However, it does not cover for any loss, destruction or damage caused by the forest fire. Exclusions: The list of exclusions is common under most fire insurance policies though they might be offered by other insurance companies. This list is as follows - Any type of loss or damage which is caused due to war and related perils like invasion, civil commotion, military revolution, civil war, rebellion, etc. Any type of loss or damage which is caused due to nuclear contamination, radiation or related perils Any type of loss or damage which is caused by contamination or pollution. However, if there is contamination or pollution which happens due to an insured peril, such pollution or contamination would be covered. However, if the peril which is insured under the policy, happens due to pollution, the damages suffered would not be covered Aircraft damages which happen due to pressure waves Any type of loss or damage which is caused due to earthquakes, volcanic eruptions, etc. However, fire insurance policies provide extension coverage for these instances. The policyholder can get coverage for them by opting for the extension cover Things like artwork, money, important documents, precious stones, etc. would not be covered under a standard fire insurance policy. To avail coverage for them, their particulars should be clearly detailed when buying the policy Any type of loss or damage in cold storage if there is a change in temperature Any type of loss or damage caused to the electrical equipment, apparatus, furniture and fixtures, etc. which happens due to short circuit, over usage, extreme pressure, etc. Costs of surveyors, engineers, architects, etc. would not be covered under the plan. However, there is an extension available for covering these costs. The policy holder can buy the extension and get these costs covered The costs incurred in removal of debris after the damage has been done are not covered. This coverage can also be availed by choosing the debris removal extension under the policy Any type of consequential losses is not covered under the plan Loss of earning or loss due to delay in production after damage has occurred is not covered.