Property Liability And Pecuniary Loss Insurance

Topics: Insurance, Liability insurance, Types of insurance Pages: 140 (12379 words) Published: June 29, 2015
PROPERTY, LIABILITY AND PECUNIARY
LOSS INSURANCE(PLPLI)

PU, BBA-BI 6th Semester

By Baikuntha Raj Timasina
MBA, BEd TU

Fire Insurance
2








Fire is a magnificent servant but a terrible master
Insurance that is used to cover damage caused
by fire is fire insurance
Specified form of property insurance, designed to
cover the cost of replacement, reconstruction or
repair
Policy cover damage to the building itself and
may also cover the damage to nearby structure,
personal property and expenses associated with
not being able to live in or use the property if it is
damaged.
PLPLI, By Baikuntha Raj Timasina

6/29/15

3











Test book:
Harrington Scott E , Risk Management and
Insurance, Tata McGraw-Hill Publishing Company
Ltd.
Redga E Gorge, Principals of Risk Management
and Insurance, Pearson Education Inc India.
Reference Books:
Indian Institute of Banking and Finance, Risk
Management, Macmillan India Ltd.
Holyoka, Julia Welpers, William, Insurance , A.I.IB.S
Publisher and Distriobuter, India.
PLPLI, By Baikuntha Raj Timasina

6/29/15

Fire Insurance contd..
4



Can only deal with the financial aspect,
but even if the owner of the fire ravaged
property is compensated the community
is worse off to the extent of the damage
sustained.

PLPLI, By Baikuntha Raj Timasina

6/29/15

History
5

Fire insurance seems to have originated in western
Europe in 13th century, it was a community rather
than a commercial basis.
• Later charitable donations formed the basis of any
compensation, available but abuses lead to
regulating legislation in the early 18 th Century
a) The great fire of London 1666
) Though the marine and life insurances were being
sold before, the great fire of 1666 prompted the
formation of fire insurance. Phonix is believed to be
the pioneer company by 1680, though exact dates
are not known.


PLPLI, By Baikuntha Raj Timasina

6/29/15

History
6

b.

The industrial revolution
The transformation of predominantly rural
community to the first leading industrial
nation was accelerated process between
approximately 1780-1850. Although some
have changed in term but it was indeed
revolution making radical and permanent
changes.

PLPLI, By Baikuntha Raj Timasina

6/29/15

Types
7

1.

Valued Policy:
The agreed value of the subject matter is maintained in the
policy is named as valid policy. This value may not
necessary be the actual value of the property. In the event
of loss by fire the insurer pays the admitted value of the
property
(A statute that requires insurance companies to pay the full value of the insurance to an insured entity in the event of a total loss.)

2.

Unvalued Policy/ Open Policy:
An unvalued policy is one in which the value of the subject
matter is not declared at the time of policy taking. But in
case of loss the value is computed by assessment .
PLPLI, By Baikuntha Raj Timasina

6/29/15

Types contd..
8

3.

Specific policy:
The property is insured for a defined sum, if there is
loss, the stated amount will have to be paid to the
policy holder. But the actual value of the subject
matter is not considered in this respect.

4.

Average Policy:
It’s the one which contain the average clause,
this clause requires the insurance company to
pay only that portion of the loss which is borne
by the insured amount to the actual value of the
subject matter of the insurance.
PLPLI, By Baikuntha Raj Timasina

6/29/15

Types contd..
9

5.

Floating Policy:
This covers the fluctuating risks of several goods lying in
different localities for supply to various markets. Such a
policy is usually taken out under one sum and one premium
by the businessmen whose goods lying at docks and warehouse.

6.

Stock declaration policy:
This policy is taken for covering the stock where great
fluctuation in the value can happen...
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