Page 57 - Fire Insurance Ebook IC 57

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b. Irrespective of the premium eventually paid on expiry of
the policy, the liability under the policy remains upto the
sum insured at all times during the currency of the policy.

c. The provision for adjustment of premium is an incentive to
the insured to effect cover for the maximum amount at risk
that may be anticipated by him.

Floating/floater policy

n Floating policies are granted to cover under a single policy stocks
which fluctuate between different locations.

n The stocks may be stored in different godowns at different
locations in the same town, city, state or other states as well.

n At any point of time, the insured may not be able to give separate
value in each godown but is able to give only the total value at
risk at all locations.

n A floating policy covers stocks at various locations (process
blocks, godowns and / or open) under one sum insured.

n The premium is charged at the highest rate applicable to insured's
property at one location plus 10% loading. In case stocks in a
process block are covered under the Floating Policy and the rate
for the process block is higher than the storage rate, the process
rate plus 10% loading shall apply.

Floater declaration policies

The Tariff allows the issue of Floater Declaration Policies subject to a
minimum sum insured of Rs.2 crores and compliance with the Rules for
Declaration policies except that the minimum retention shall be 80% of
the annual premium.

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