factory insurance

Factory Insurance

Factory insurance is a policy that offers factory owners financial protection against unexpected loss or damage to their factory’s structure and stored goods, depending on the chosen coverage. Factory owners should consider this insurance plan because it covers damages to goods both inside and outside the premises.

Advantages of Factory Insurance

Here are some benefits that fire insurance offers for factories:

  • Policyholders can enhance their coverage by purchasing add-ons offered by the insurer.
  • You can also cover portable electronics for specific losses like breakdown, short-circuit, theft, etc., while traveling to another country.
  • The replacement cost of damaged property is provided instead of the book value through reinstatement and escalation value clauses.
  • The SFSP policy can cover alternate accommodation expenses if the factory is damaged.

What is included in the Factory Insurance?

Factory fire insurance covers the following perils:

  • Fire insurance covers loss or damage to the building’s structure or its contents caused by fire.
  • Insurance covers loss or damage caused by natural calamities such as earthquakes, floods, storms, etc.
  • Insurance covers loss or damage caused by implosions, explosions, etc.
  • The insurance also covers losses due to theft, mechanical or electronic breakdowns (additional coverage is included).

*When purchasing this policy, policy buyers can consult the detailed list of coverage provided in the policy wording.

What is Excluded in the Factory Insurance?

Factory fire insurance excludes coverage for the following perils:

  • The policy does not cover intentional loss or damage.
  • The policy does not cover loss or damage caused by any illegal activity.
  • The policy does not cover any consequential loss or damages.
  • The policy does not cover normal wear and tear.
  • The policy also excludes coverage for deterioration.
  • The policy does not cover loss or damage caused by pollution.
  • The policy does not cover loss or damage caused by war or radioactive contamination.

*At the time of purchasing this policy, policy buyers can consult the detailed list of coverage provided in the policy wording.

What are ways to minimize Factory Insurance Premiums?

Several factors can contribute to keeping the factory insurance premium lower when purchasing the insurance plan.

  • Having a lower claim history in the last 3 years contributes to lower factory insurance premiums.
  • Implementing security measures such as CCTV cameras and having a 24/7 security guard on duty helps reduce factory insurance premiums.
  • Fire safety measures, including water sprinklers, hydrants, fire extinguishers, etc., are installed on the premises.
  • Maintaining an AMC for the equipment and machines.
  • Lowering or eliminating exposure to basement levels.

What is the Claim Process of Factory Insurance?

Follow these steps to raise a claim under your online factory insurance policy:

  • First, call the fire brigade if a fire accident occurs.
  • Then, contact the insurer within 24 hours of the loss or damage.
  • The insurer will send a surveyor to inspect the loss or damage.
  • Assist the surveyor during the inspection.
  • Once the surveyor is satisfied, they will inform the insurance company.
  • Then, the insurer will start the settlement process.
  • Documents Needed to File a Claim under Factory Insurance

Documents Needed to File a Claim under Factory Insurance

  • Claim Form
  • Final Investigation Report
  • FIR, if any
  • Submit the fire brigade report in case of a fire.
  • Provide a copy of the invoice for the damaged asset.
  • If required, submit a forensic report.
  • Calculate the cost of repairing or replacing lost products.
  • Submit any additional documents as per the insurer’s requirements.