Industrial All Risks Insurance

Industrial All Risks Insurance is a wider cover than traditional Named perils fire insurance policy is defined by
exclusions.

Key Features

It is an all risk policy defined by exclusions.

Underinsurance upto 15% is waived.

It provides cover for material damage for fire and allied perils and also breakdown along with consequential
loss cover under one policy document.

Risk survey

The purpose of this section is to give the reader an overview of risk engineering survey provided to our underwriters
and the clients. We recruit the engineers, mostly as members of the property department and engage them in
property surveys on behalf of the local underwriting group. The philosophy of risk engineering is to supplement the
efforts of the underwriters in realizing the set profit and growth by providing technical support to them per se, and by
providing value addition to the clients risk management process. It is often said that the risk engineers are the eyes
and ears of the property underwriter who needs to underwrite the risk after fully understanding a risk. To put it
succinctly the main objectives of risk engineering is to assess the quality of risk and to enable underwriter to write the
risk and arrange suitable reinsurance Program. While smaller and not so complex risks can be assessed based on
the proposal forms or based on the producers report, it will be difficult / unreliable to do so in case of major accounts
and the cost of an error in underwriting such major risks would far outweigh the cost of a survey. Remotely assessing
the risk without visiting the same is nearly impossible as each risk or account is unique by itself based on the
process, the practices and the people. The survey is taken up based on the survey request received from the
underwriter for both property damage and business interruption risks. The survey intends to serve the underwriter
and the client in respect of the following ways.

To make an on site study and evaluation of the various exposures like fire, flood and specific exposures if
any, incorporating various underwriting information in the report to enable the underwriter to prudently decide on the
acceptability or otherwise of the risk. The quantitative risk rating on a 5 point scale provided in the report helps the
underwriter to quickly make up their mind on the overall opinion of the risk. The report lists in detail the major
undesirable features of the risk, surrounding exposures, various occupancy hazards and other loss potentials.

As a logical sequence of exposure analysis and establishment of various pure risks, risk control measures
are conveyed to the client or the prospect to mitigate the risk. The client sees a great value addition in this as very
often the insurer gives this service free of cost. The recommendations broadly fall under Human element
recommendations and Physical protection recommendations. While the later needs some capital expenditure and
planning, the former can be implemented easily.
The survey report is valued by the underwriter for both the above two aspects while the client mainly values the report
for the later.
Provision of inputs to the insurer in respects of limits, risk selection and rating is in the scope of survey. Specifically
the survey brings out the COPE factors of a risk i.e. Construction, Occupation, Protection and Exposure. Property

engineers have to establish the protective measures which are available at a given location and assess their
adequacy, quality and reliability in relation to the property being insured. The local codes and laws of the country
provide for certain standards and the engineers are to be familiar with such requirements. For underwriting purpose
the protection to be checked includes automated sprinkler systems. Fire hydrant systems, Water supplies, Fire alarm
systems, Public and or Private fire brigade protection, First aid and other fire protection topics, Special fire protection
systems, Inspection and maintenance of the systems etc. Although the survey generally considers protection against
fire, property engineers must be alert to other perils like Earthquake, Flood and Cyclone and make a mention in the
report.
In another area where the survey helps, is in making the various loss estimates for the risk. The survey report brings
out Maximum Amount Subject (MAS), Maximum Foreseeable Loss (MFL) and the Probable Maximum Loss (PML)
using the well defined guidelines in our survey manual, combined with the judgment of the inspecting engineer. The
loss estimates help the underwriter and the re-insurer to decide the level of retention, cession and the overall
underwriting capacity.
Incidentally an enormous amount of useful data is generated during a survey and hence in the long run the survey
process would help in settling up a database of all the property risks inspected in the country and would help in
deciding the focus area and plan out the business strategies. The de-tariffing of the fire portfolio call, for per se rating
of each risk based on the risk factors of individual risk in a competitive manner. This would mean that a risk needs to
be necessarily looked at from a risk management perspective and hence risk engineering would be called to play a
vital and larger role in a deregulated market. As a visionary insurer we can inspect as many risks in the country and
quickly compile a report guide which will help in developing a rating guide and position ourselves strategically to
meet the challenges of competition in the deregulated market.
Property Risk Information:

Construction - Type of Construction

Occupancy - The Manufacturing Activity

Protection - Fire Protection and Safety Measures

Exposure - Surrounding and Catastrophe

Process description

Policy Details - Sum Insured

Loss History / claims experience

Who should buy this product

This cover can be bought by the insured engaged in Manufacturing activity and need protection for all risk coverage.