Fire Insurance Nature, Basic Covers, Inspection Requirements & Related Misconceptions (concluding Part)

 Benefits of the insured in getting the risk inspected by an insurance company:

  • Insured gets to know about the adverse features of the plant
  • Loss control measures suggested by the insurance company help in reducing the probable hazards
  • If adequate discount features are available client can opt for higher discounts
  • The insurance company provides free service for risk assessment program

Benefits of the insurer:

  • It helps the insurer in underwriting safe risks
  • Risk inspections enhance a communication channel with the insured that help them in further business deals
  • Profitability of the insurer increases if there is no claim against the policy

It has been experienced on several occasions that

the insured doesn’t take the insurance risk inspections seriously. At a factory recently visited by us for the risk management program, we suggested the client to install flameproof electrical fittings instead of ordinary electrical fittings where hydrogen was in use.

Hydrogen being highly flammable (LEL – 3% UEL – 78%) may pose serious fire hazards. The client’s maintenance person humbly replied, “I am here from the past 15 years and I am a witness to all the accident free days I have spent here. Bookish rules and the practical rules are very different”.

Preventive or protective measures suggested are often taken lightly and it often becomes an egoistic issue. The general reply expected at such an occasion is, “when no such event happened till date, how


can it happen now”. Remember, accidents don’t take place everyday. Unless safety is taken seriously, it can turn into severe consequences.

Another common experience is that the details required by a risk inspector are not provided to the full. Every question asked by the risk engineer has a certain reason that would value at the time of claim. For e.g. if the de-watering arrangements, drainage system etc. is asked for during a fire insurance risk inspection, it is asked for the safety measures against the losses due to inundation.

Insurance company may also deny underwriting the risk if the safety matters are reported as inadequate and there is a chance of loss.

Though insurance is meant for the disastrous moments that can take place yet proper safety precautions are always for the benefit of the insurer. Insured must beware of the fact that no insurance policy provides cover for losses due to negligence. Hence it is always recommended not to neglect any safety feature and maintain the plant properly.
 



Article Written By archit

I write because I like writing and hope that someone benefits from the things I have learned from my teachers and the learned people I have met so far. The purpose here is not to attract any requests for horoscope analysis but just to share the thoughts. Astrology and spiritual matters are my areas of interest.

Last updated on 22-07-2016 93 0

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Fire Insurance Nature, Basic Covers, Inspection Requirements & Related Misconceptions
Plant Layout & Safety Considerations