Page 334 - Fire Insurance Ebook IC 57

Fire and Consequential Loss Insurance

premiums, (as in case of FEA) , the net premium
is used in the calculation.

Q2. Write notes on

a. C L rate - The rate for Annual Insurance is not less
than the provided percentages of the basis rate. There
is a listed guideline of the plants carrying out automatic
and semiautomatic continuous processes which can be
checked with the Regional Committee.

The percentages for the shorter indemnity periods are
proportionately much higher than the longer periods. The
extent of interruption during the early months after fire
is greater than the later months when the situation
becomes more or less under control.

Also in case of excessive damage, there may be savings
in standing charges, which may not be possible during
shorter periods of interruption. It is the general
expectation that the loss of gross profit will progressively
diminish as the date of the fire recedes, and the scale of
percentage for longer indemnity period is made
accordingly.

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