Industrial All Risk Insurance (IAR)

Industrial All Risk Insurance (IAR)

Large industries having properties on one or more locations of more than INR50 Crore are eligible for an Industrial All Risk Insurance policy which covers the financial loss occurring to the company due to an unforeseen event like fire or burglary unfolding during the policy period.

Not only does this policy cover the Building, Machinery, Electronic equipment, or Stock loss but it also covers the Loss of Profit due to Fire (FLOP) or Machinery Breakdown (MLOP).

What are the coverage of Industrial All Risk Insurance (IAR)?

The coverage under Industrial All Risk Insurance (IAR) can be broadly divided in to two parts.

This section covers the financial losses occurring due to any one or more perils covered in policy. These perils are

  • Fire and Allied Perils
  • Burglary
  • Earthquake
  • Machinery Breakdown
  • Boiler Explosion
  • Electronic Equipment Insurance

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The second section of the policy covers the Loss of Profit due to business interruption caused by Fire or Machinery Breakdown.

  • Fire Loss of Profit
  • Machinery Loss of Profit due to Machinery Breakdown

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Industrial All Risk Insurance (IAR) policy has the following add-on covers available on payment of additional premium.

  • Terrorism
  • Omission to insure
  • Architects, Surveyors, or Consulting Engineers fee
  • Temporary removal of stocks clause
  • Debris removal clause
  • Escalation clause
  • Earthquake

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Following are the general exclusions under an Industrial All Risk Insurance (IAR) policy.

  • Normal Wear & Tear, Inherent Vice
  • Faulty or Defective Design, material or workmanship
  • Pollution or Contamination
  • Fraud or Larceny
  • Money, cheques, stamps, bonds, credit cards, bullion, precious stones, works of art
  • Goods held in trust or commission, business books, computer records, manuscripts
  • Vehicles licensed for road use
  • Property in transit other than within the premises specified in the policy
  • Livestock, growing crops or trees

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Please note that the aforementioned information is only a gist of product and doesn’t cover all the T&C of the policy. In order to know about the policy and its suitability for your business please Contact Us.

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