Page 291 - Fire Insurance Ebook IC 57

The Insurance Times

Consequential Loss Insurance Policy

Salient provisions
(i) Fire or other peril must occur at the Insured's premises;

(ii) Property used for the business of the Insured at the Insured
premises must be destroyed or damaged;

(iii) The business, must be interrupted or interfered with as a
consequence;

(iv) The resulting loss is paid in accordance with the provisions of
the Specification incorporated in the policy.

(v) The 'business' of the insured is required to be described in the
policy and the location of the premises must be specified.

'Material Damage' proviso

Insured must maintain a material damage fire policy and claim under
C.L.Policy will be paid only if the-material damage claim is paid or
payable.

There are three reasons for the proviso :

(a) It dispenses with the need for incorporating in the C.L. policy all
the conditions and warranties governing the fire hazard. The effect
is, that, if any warranty is broken or any condition is not complied
with under the Fire Policy, rendering that cover invalid, the
consequential loss policy also becomes invalid.

(b) Independent investigation of the origin of fire or other insured
peril under consequential loss policy is rendered unnecessary.

(c) The existence of the material damage insurance ensures that the
damaged property will be restored with the amount of loss paid
thereunder.

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