Bharat Laghu Udyam Suraksha Insurance Policy – Detailed Guide

What is Bharat Laghu Udyam Suraksha Policy (BLUS Policy)?

Bharat Laghu Udyam Suraksha Policy (BLUS Policy) is a Fire Insurance Policy designed to protect enterprises whose total value at risk across all insurable asset classes at one location exceeds Rs5 Crores but does not exceed Rs50 Crores at the Policy Commencement Date. All types of assets like plant and machinery, warehouse stocks, buildings etc can be covered under a Bharat Laghu Udyam Suraksha Policy. The only difference between Bharat Sookshma Udyam Suraksha Policy (BSUS Policy) and Bharat Laghu Udyam Suraksha Policy (BLUS Policy) is that BSUS covers assets upto a Sum Insured of Rs5 Crores while BLUS Policy covers assets from a Sum Insured of Rs5 Crores to Rs50 Crores. Otherwise, both policies are similar in terms of insurance coverage, exclusions etc.

What are the perils covered under Bharat Laghu Udyam Suraksha Insurance Policy?

A Bharat Laghu Udyam Suraksha Insurance Policy provides coverage against the following Perils:

1. Fire, including due to its own fermentation, natural heating or spontaneous combustion
2. Explosion and Implosion
3. Lightning
4. Earthquake, Volcanic Eruption or other convulsions of nature
5. Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Tsunami, Flood and Inundation (STFI Cover)
6. Subsidence, Landslide or Rockslide
7. Bushfires, Forest Fire, Jungle Fire
8. Impact Damage caused by any external physical object
9. Loss or Damage due to Missile Testing Operations
10. Riot, Strikes, Malicious Damage (RSMD)
11. Terrorism
12. Bursting or Overflowing of Water Tanks, Apparatus and Pipes
13. Leakage from Automatic Sprinkler Installations
14. Theft within 7 days of occurrence of damage due to above Insured Perils

What are the in-built covers under Bharat Laghu Udyam Suraksha Insurance Policy?

Bharat Laghu Udyam Suraksha Policy provides the following add-on covers in addition to providing reimbursement for damage caused by any of the Insured Perils:

1. Additions, Alterations or Extensions: The BLUS Policy provides reimbursement for any property that the Insured may erect, acquire or add during the Policy Period upto 15% of the Sum Insured.
2. Temporary Removal of Stocks: The Bharat Laghu Udyam Suraksha Policy has an Inbuilt Cover for loss to stock temporarily removed to other premises for fabrication, processing or finishing upto 10% of the value.
3. Start-Up Expenses: The Bharat Laghu Udyam Suraksha Insurance Policy also pays for Start-Up Cost incurred by the Insured following damage by an Insured Peril upto a sum of Rs5 Lakh Rupees
4. Professional Fees: The Bharat Laghu Udyam Suraksha Policy also pays for reasonable fees for architects, surveyors and consulting engineers upto 5% of the Claim Amount.
5. Cost for Removal of Debris: The BLUS Policy pays reasonable expenses for Removal of Debris upto 2% of the Claim Amount.
6. Costs compelled by Municipal Regulations: The Policy also has a provision for additional cost of reconstruction of property incurred solely for complying with Municipal Regulations.

What are the exclusions under Bharat Laghu Udyam Suraksha Insurance Policy?

The BLUS Insurance Policy will not pay any losses arising out of the following:

1. Damage to Insured Property caused by its undergoing any heating or drying process
2. Burning of Insured Property by order of any public authority
3. Damage caused to Boilers or Economisers or other vessels or other vessels, machinery or apparatus in which steam is generated or their contents resulting from their own explosion or implosion
4. Damage caused by normal cracking, settlement or bedding down of new structures
5. Destruction caused by total or partial cessation of work or the retardation/interruption/cessation of any process or operations
6. Damage caused to Insured Property by a vehicle, animal or aircraft belonging to or owned by the Insured or their employee while acting in course of employment

What are the factors affecting the cost of Bharat Laghu Udyam Suraksha Policy?

The following factors affect the premium of Bharat Laghu Udyam Suraksha Policy

1. Risk Profile of the Insured Business: The Premium of the BLUS Policy will be higher for a riskier business (Say, chemical business) as compared to a business with a lower risk component (say an office premises)
2. Sum Insured: The premium of Bharat Laghu Udyam Suraksha Policy will be higher for properties with a higher Sum Insured. For example, the premium for a chemical factory with a Sum Insured of Rs30 Crores will be higher than a factory with a Sum Insured of Rs15 Crores
3. Fire Protection Measures at Insured Premises: The Risk and Fire Protection Measures installed at the business premises impact the discount and consequently the premium of Bharat Laghu Udyam Suraksha Policy. For example, the premium of a business with a Fire Extinguisher installed at premises will be lower than the Insurance Premium for a business with no fire extinguisher installed.

Who is eligible to purchase a Bharat Laghu Udyam Suraksha Policy?

The following people are eligible to purchase a Bharat Laghu Udyam Suraksha Policy:

1. The Insured owns or occupies or uses the property under lease
2. The Insured occupies the property as a purchaser under an agreement of sale or lease
3. The Insured holds the property under in trust or commission or is responsible for it

Conclusion

The Bharat Laghu Udyam Suraksha Policy is an important Insurance Policy for business owners as it provides comprehensive Fire Insurance Coverage and protects them from losses. If you wish to purchase a Fire Insurance Policy for your factory you can email us at insurance@qian.co.in or call us on 022-22044989.

We would be glad to assist you.