Re: Minimum Deductibles Applicable for Fire & Engineering Policies w.e.f.

01/11/2018

This is to inform that for all Fresh/Renewal/Rollover business having risk start date on or from 1st
November 2018, the minimum deductibles in Fire and Engineering portfolio will stand revised as follows:

1. FIRE INSURANCE

1.1 Standard Fire & Special Perils Policy (SFSP):

Excess For claims arising For claims arising

out of AOG perils out of perils other than AOG
All policies having sum insured 10% of the claim amount subject 5% of the claim amount subject
upto 10 crore per location per to a minimum of INR 15,000 to a minimum of INR 15,000
insured
All policies having sum insured 10% of the claim amount subject 5% of the claim amount subject
equal to or above 10 crore up to to a minimum of INR 37,500 to a minimum of INR 37,500
INR 100 crore per location per
insured
All policies having sum insured 10% of the claim amount subject 5% of the claim amount subject
equal to or above 100 crore up to a minimum of INR 7.50 lakhs to a minimum of INR 7.50 lakhs
to INR 1,500 crore per location
per insured
All policies having sum insured 10% of the claim amount subject 5% of the claim amount subject
equal to or above 1,500 crore up to a minimum of INR 37.50 lakhs to a minimum of INR 37.50 lakhs
to INR 2,500 crore per location
per insured
All policies having sum insured 10% of the claim amount subject 5% of the claim amount subject
equal to and above INR 2,500 to a minimum of INR 75 lakhs to a minimum of INR 75 lakhs
crore per location per insured

Note 1 – For floater policies / floater declaration policies deductible applicable will be based on the value
at risk of the affected location.

Note 2 – Entire set of assets associated with a cross country occupancy such as road (including bridges,
culverts, signages, etc) or pipeline should have the following deductibles even if insured through multiple
policies (for all risks having sum insured below INR 2500 crores).

- For claims arising out of AOG perils: 10% of the claim amount subject to a minimum of INR 10 lakhs
- For claims arising out of other than AOG perils: 5% of the claim amount subject to a minimum of INR
2.5 lakhs
- Irrespective of the fact that separate policy is given to road side assets, toll plaza and roads the
deductible would be as above.

Note 3 - a) The limit for sum insured is combined limit for SFSP + BI (if any) per location
b) In case locationwise BI is not available or provided, then the total BI Sum Insured should be
added to the peak location to arrive at the deductible applicable.

1.2 Business Interruption (FLOP) –

Non Large Risks –

Petrochemical Risk, Chemical risks using materials with flash point less than 32 degrees Celsius, Power
plants (thermal & gas) and Steel plants – 14 days of Gross Profit for IP period up to 9 months and 1 day
extra for each month’s increase in IP period.
Other than above risks - 7 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.

Large risks –

Petrochemical Risk, chemical risks using materials with flash point less than 32 degrees Celsius, Power
plants (thermal & gas), Steel plants – 21 days of Gross Profit for IP period up to 9 months and 1 day
extra for each month’s increase in IP period.

Other than above risks - 14 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.

1.3 Industrial All Risk Policy

1.3.1 Policies having Sum Insured upto INR 100 Cr per location for PD & BI

Material Damage:
For claims arising For claims arising
out of AOG perils out of perils other than AOG
10% of the claim amount subject 5% of the claim amount subject to
to a minimum of INR 7.50 lakhs a minimum of INR 7.50 lakhs

Business Interruption (FLOP)-

Petrochemical Risk, chemical risks using materials with flash point less than 32 degrees, Power plants
(thermal & gas), Steel plants – 14 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Other than above risks - 7 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.

Business Interruption (MLOP) - 14 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

1.3.2 Policies having Sum Insured equal to or above INR 100 Cr and up to INR 1500 Cr per
location for PD & BI.

Material Damage:
For claims arising For claims arising
out of AOG perils out of perils other than AOG
10% of the claim amount subject 5% of the claim amount subject to
to a minimum of INR 15 lakhs a minimum of INR 15 lakhs

Business Interruption (FLOP)-

Petrochemical Risk, chemical risks using materials with flash point less than 32 degrees, Power plants
(thermal & gas), Steel plants – 14 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Other than above risks - 7 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.
Business Interruption (MLOP) - 14 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

1.3.3 Policies having Sum Insured equal to or above INR 1500 Cr and up to INR 2500 Cr per
location for PD & BI.

Material Damage:

For claims arising For claims arising

out of AOG perils out of perils other than AOG
10% of the claim amount subject 5% of the claim amount subject to
to a minimum of INR 37.50 lakhs a minimum of INR 37.50 lakhs

Business Interruption (FLOP)-

Petrochemical Risk, chemical risks using materials with flash point less than 32 degrees, Power plants
(thermal & gas), Steel plants – 14 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Other than above risks - 7 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.

Business Interruption (MLOP) - 14 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

1.3.4 Policies having Sum Insured equal to or above INR 2500 Cr per location for PD & BI.

Material Damage:

For claims arising For claims arising

out of AOG perils out of perils other than AOG
10% of the claim amount subject 5% of the claim amount subject to
to a minimum of INR 75 lakhs a minimum of INR 75 lakhs

Business Interruption-

Petrochemical Risk, chemical risks using materials with flash point less than 32 degrees, Power plants
(thermal & gas), Steel plants – 21 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Other than above risks - 14 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.

Business Interruption (MLOP) - 28 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Note 4: The limit for sum insured is combined limit for MD + BI per location

1.4 Large Risk Policies - Policies having Sum Insured equal to and above INR 2500 Cr
per location for PD & BI
Material Damage:
 For claims arising For claims arising
out of AOG perils out of perils other than AOG
10% of the claim amount subject 5% of the claim amount subject to
to a minimum of INR 75 lakhs a minimum of INR 75 lakhs

Business Interruption-

Petrochemical Risk, chemical risks using materials with flash point less than 32 degrees, Power plants
(thermal & gas), Steel plants – 21 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Other than above risks - 14 days of Gross Profit for IP period up to 9 months and 1 day extra for each
month’s increase in IP period.

Business Interruption (MLOP) - 28 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

Note 5: The limit for sum insured is combined limit for MD + BI per location

1.5 Cellular Network Policies

Material Damage –

For claims arising For claims arising

out of AOG perils out of perils other than AOG
10% of claim amount subject to a 5% of claim amount subject to a
minimum of INR 10 lakh minimum of INR 2.5 lakh

Business Interruption- 3 Days of Gross Profit

2. ENGINEERING INSURANCE

2.1 Project Insurance - Contractors All Risk Insurance/ Erection All Risk Insurance (other than
combined cycle power plants/ gas based power plants)-

2.1.1. For Sum Insured up to INR 1500 Cr. - All deductible amounts appearing in erstwhile TAC Tariff
would be increased to 7.5 times of the minimum amount

2.1.2. For Sum Insured above INR 1500 Cr. and up to INR 2500 Cr - All deductible amounts appearing
in TAC Tariff would be increased to 15 times of the minimum amount.

2.1.3. For Sum Insured above INR 2500 Cr. - All deductible amounts appearing in TAC Tariff would be
increased to 22.50 times of the minimum amount.

For all sum insured slabs AOG excess to be increased to 10% of the claim amount subject to minimum
as given above (applicable for AOG) without any upper limit.

2.1.4 Advance Loss of Profits Time excess- 30 days for first year+ 1 day for each erection month in
addition to 12 months not exceeding 60 days.

2.2.1 Project Insurance - Specialized risks – ( The following risks would be termed as specialized risks
- All works in water, dams, canals, hydro power projects, tunnels, irrigation systems, caverns.) – All
deductible amounts appearing in TAC Tariff would be increased to 22.50 times of the minimum amount.

AOG excess to be increased to 10% of the claim amount subject to minimum as given above (applicable
for AOG) without any upper limit.

2.2.2 Advance Loss of Profits Time excess- 45 days for first year+ 1 day for each erection month in
addition to 12 months not exceeding 75 days

2.3.1 Project Insurance - Combined cycle power plants/ gas based power plants

50 MW to 200 MW- 5% of claim amount subject to a minimum of 90 lakhs for testing & 30 lakhs for normal
excess

200 MW to 300 MW- 5% of claim amount subject to a minimum 150 lakhs for testing & 75 lakhs for
normal excess

300 MW and above- 5% of claim amount subject to a minimum 187.50 lakhs for testing & 112.50 lakhs
for normal excess

AOG excess to be increased to 10% of the claim amount subject to minimum as given above (applicable
for AOG) without any upper limit.

2.3.2 Advance Loss of Profits Time excess- 45 days for first year+ 1 day for each erection month in
addition to 12 months not exceeding 75 days

2.4. Machinery Breakdown

1% of sum insured for each machine subject to a minimum of Rs 5,000

Note 6: Sum Insured of the machine should be declared as a whole and should not be apportioned
towards parts of machine.
2.5 Business Interruption (MLOP) – 14 days of Gross Profit for IP period of 9 months and 1 day extra
for each month’s increase in IP period.

For Large Risks Business Interruption (MLOP) -

Business Interruption (MLOP) - 28 days of Gross Profit for IP period up to 9 months and 1 day extra for
each month’s increase in IP period.

2.6. Contractors Plant & Machinery- For all Machinery under Group I,II,III,IV, including cranes
above 10 tonne capacity under Group III
EXCESSES
For claims arising out of For claims arising
Value of equipments
AOG perils out of perils other than AOG
Individual value upto Rs.1 15 % of S.I. Subject to a 3 % of S.I. subject to minimum
lakh. minimum of Rs. 7,500/- of Rs. 2,250/-
Individual value over Rs. 1 7.5 % of S.I. Subject to a 2.25 % of S.I. subject to
lakh and upto Rs. 5 lakh. minimum of Rs.15, 000/- minimum of Rs. 3, 000/-
Individual value over Rs. 5 4.5 % of S.I. subject to a 1.875 % of S.I. subject to
lakh and upto Rs.10 lakhs. minimum of Rs. 37,500/- minimum of Rs. 11,250/-
Individual value over Rs. 10 3 % of S.I. subject to a 1.50 % of S.I. subject to
lakhs uptoRs. 25 lakhs minimum of Rs. 45, 000/- minimum of Rs. 18,750/-
Individual value over Rs. 25 1.5 % of S.I. Subject to a 1.5 % of S.I. Subject to a
lakhs uptoRs. 50 lakhs minimum of Rs. 75, 000/- minimum of Rs. 75, 000/-
Individual value over Rs. 50
1.5 % of S.I. Subject to a 1.5 % of S.I. Subject to a
lakhs
minimum of Rs. 75, 000/- minimum of Rs. 75, 000/-

Boom Section- 20 % of claim amount subject to minimum of Rs. ,37,500

For Machinery under Group V - Rs.,3,750/- Flat. Excess.

2.7 Electronic Equipment Insurance- As per Tariff except for the following changes
Section I – a – i: For equipments with values upto Rs.1 lakh -
5 % of the claim amount subject to a minimum of Rs. 2,500
Section II – a : For equipments with values upto Rs.1 lakh -
5 % of the claim amount subject to a minimum of Rs. 2,500

2.8 Boiler Insurance- 5% of claim amount subject to a minimum of Rs 15,000/-

Note 7 – Applicable to Package Policies – The revision is applicable for respective Fire and
Engineering sections of package policies.

Note 8 – The above deductibles will be applicable for:

- All policies issued before 1st November 2018 but with inception period on or after 1st November 2018
- All policies expiring on or after 1st November 2018 but renewal preponed to a date prior to 1 st
November 2018