Page 360 - Fire Insurance Ebook IC 57

Fire and Consequential Loss Insurance

Important Points to Remember

Specialised policies and overseas practice

n Oil and Petrochemical industry a fast growing industry in the
world is a 'high risk' area for insurance.

n Underwriting of these plants against fire and explosion risks
requires special expertise as virtually everything used in the plants
may burn or explode.

n The potential risk of fire / explosion is of a high magnitude in a
large complex where bulk quantities of highly flammable materials
mostly in liquid, vapour and gaseous form are handled.

n The need for introduction of a tariff based on scientific principles
was felt in the Seventies as several property and business
interruption losses exceeding Rs.l crore were reported.

n The first version of Petrochemical Tariff was introduced in the
year 1976. The Tariff was, thereafter, revised in 1981, 1987 and in
1996 to meet the changing requirements of the industry.

n The Tariff comprises definitions, eligibility criteria, rating
procedure

This tariff is applicable to

a) Petrochemical plants,
b Petroleum Refinery Plants including Sulphur Recovery.
c) Fertiliser plants with feed stocks like Naptha, Natural gas, etc.
d) LPG bottling plants (irrespective of Sum Insured)
e) Urea / Ammonia Synthesis Plants.

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