Page 10 - Insurance Times February 2021

forest, jungle and bush fires, impact professional fees for architects, survey- Suraksha policies will be useful for fi-
damage of any kind, riot, strike, ors and consulting engineers, cost for nancial protection of MSMEs. All the
malicious damages, acts of terrorism, removal of debris and costs compelled three Retail products have key features
bursting and overflowing of water by municipal regulations. documents (KFD) which give basic
tanks, apparatus and pipes, leakage The policy can be taken by micro level information about the products.
from automatic sprinkler installations enterprises such as offices, hotels,
and theft within 7 days from the industries, storage risks and so on, IRDAI panel proposes
occurrence of any of the events. IRDAI said. "The policy waives
"The policy offers two optional covers: underinsurance to the extent of 15 per norms for rising 'silent
insurance for valuable contents like cent," it said. cyber risks'
jewellery and curios and personal The IRDAI also announced Bharat Working Group on Cyber Security
accident of the insured and spouse due Laghu Udyam Suraksha that provides formed by IRDAI, has proposed
to an insured peril under the policy," cover for the building / structures, detailed recommendations.
the regulator said. plant and machinery, stock and other "Insurers may place this matter (silent
The policy gives complete waiver of assets of enterprises where the total cyber issue) high on the agenda and
underinsurance. "In other words, if the value of risk across all insurable asset address this problem sooner than
sum insured declared by a policyholder classes at one location exceeds Rs 5 later," the committee said in its
is less than what ought to have been crore but does not exceed Rs 50 crore report. In simple words, silent cyber is
declared for the property in question, at the policy commencement date. the unknown exposure in an insurer's
the policyholder's claim will not be The range of perils against which portfolio created by a cyber peril,
settled proportionately but up to the insurance is offered is similar to the which has not been explicitly excluded
sum insured that is declared," it said. policy meant for micro level or included. This is also known as
The IRDAI said the Standard Fire and enterprises. "This policy too has all the "unintended" or "non-affirmative"
Special Perils (SFSP) Policy provided for in-built covers that the policy for micro cyber coverage.
in the erstwhile All India Fire Tariff level enterprises has. The policy can be "Cyber exposure is a concern for all
(AIFT) 2001 will be replaced by the taken for all types of risks such as underwriters. Cyber affirmative and
new policy. It will be mandatorily offices, hotels, industries, storage risks silent covers are scattered in many
offered by all general insurers carrying and so on," it said. different products beyond standalone
on fire and allied perils insurance "It's a welcome move from the ones. Cyber risk permeates all classes
business from April 1. regulator to introduce standard of insurance without boundaries of
The regulator also announced Bharat products against fire and allied perils industries," it said. With technology
Sookshma Udyam Suraksha that risks for dwellings, micro level and improving and digital business
provides cover for the building/ small level enterprises. Property expanding, silent cyber risks, especially
structures, plant and machinery, stock insurance is not given much in the banking sector, have also
and other assets of enterprises where significance in India, and its importance increased.
the total value at risk across all is realized only when met with an A cyber event can trigger losses across
insurable asset classes at one location unfortunate event," said Tapan Singhel, various lines of insurance - property
is up to Rs 5 crore. This policy too MD & CEO, Bajaj Allianz General damage and business interruption,
offers cover against a wide range of Insurance. resulting from computer systems
perils, quite similar to the policy meant "With standardization and failure or virus under property
for dwellings, IRDAI said. simplification of policy wordings, I hope insurance, siphoning money through
The policy has several in-built covers in that more people and enterprises will phishing under crime insurance,
addition to the basic coverage: cover opt for these products. Thus, ensuring product liability or recalls from security
for alterations, additions or financial security to the under served vulnerabilities under product liability/
extensions, cover for stocks on a floater market and benefiting the end recall insurance, breach of contract or
basis, cover for temporary removal of consumer with a holistic coverage," negligence claims under E&O
stocks, cover for specific contents, Singhel said. (technology errors and omissions)
Cover for start-up expenses (following IRDAI said Bharat Sooksma Udyam insurance and for managerial
a loss), cover for payment of Suraksha and Bharat Laghu Udyam negligence under D&O (directors and
The Insurance Times, February 2021