Factories and warehouses are involved in manufacturing and storing huge quantity of goods on a yearly basis. The value of such goods runs into crores of rupees. Damage to the factory or goods is one of the biggest risks factory owners face as it would mean a huge financial loss along with interruption of business operations for a considerable amount of time.
Since the owner is exposed to huge risk, it is always a prudent decision to purchase a Factory Insurance Policy.
What is Factory and Warehouse Insurance?
A Factory and Warehouse Insurance Policy provides cover to the Policyholder if the building structure, plant and machinery in the factory or the warehouse stock is damaged on account of certain specified perils.
What are the different perils covered under a Factory and Warehouse Insurance Policy?
A Factory Insurance Policy provides cover against various perils such as Fire, Lightning, Explosion/Implosion, Aircraft Damage, Riot, Strike Malicious Damage, Impact Damage, Landslide and Subsidence, Bursting and Overflowing Water Tanks, Missile Testing, Bushfire and Forest Fire.
The Policyholder can opt for different add-on covers like earthquake, terrorism, storm, flood, inundation, theft and burglary as well to extend the coverage to other perils by paying additional premium.
What are the benefits of a Factory Insurance Policy?
A Factory Insurance Policy offers various benefits to the Policyholder such as:
Risk Management: Crores of rupees are invested in a factory. Any damage to the plant and machinery means huge financial losses. A Factory and Warehouse Insurance Policy will ensure that such risks are mitigated and the factory owner can be rest assured that he will be able to recoup his losses with the insurance policy should an incident damage his factory or warehouse stock
Easier Availability of Bank Loans: Lenders providing loans for factories and warehouse stock will demand insurance since they want to secure themselves in case the plant and machinery or the stock is destroyed. A Factory and Warehouse Insurance Policy will provide comfort to the lenders and assist in easier availability of bank loans.
Reduction of Financial Losses: A Policyholder can also opt for a Business Interruption Insurance Policy or a Fire Loss of Profit Insurance Policy in addition to the Factory and Warehouse Insurance Policy. A Business Interruption Policy will pay the policyholder for the loss of Gross Profit faced during the business interruption period when the factory was damaged by the fire. This helps in meeting fixed costs like Loan and Interest Repayments and Employee Salaries.
What is Bharat Laghu Udyam Suraksha and Bharat Sookshma Udyam Suraksha?
Bharat Laghu Udyam Suraksha and Bharat Sookshma Udyam Suraksha are types of Factory and Warehouse Insurance Policies meant to insure small and medium scale factories.
- Bharat Sookshma Udyam Suraksha is meant to insure businesses and factories where the Total Value at Risk across all Insurable Asset Classes at one location is not exceeding Rs5 crore at the Policy Commencement Date
- Bharat Laghu Udyam Suraksha is meant to insure businesses and factories where the Total Value at Risk across all Insurable Asset Classes at one location is exceeding Rs5 crore to Rs50 crores at the Policy Commencement Date
What is the average cost of a Factory and Warehouse Insurance Policy?
The average cost of a Factory and Warehouse Insurance Policy mainly depends on the risk of the business being conducted within the factory. For eg. Chemical factories with higher risk will have higher cost compared to an engineering goods factory.
The Factory and Warehouse Insurance Cost also depends on the following factors:
- Sum Insured
- Location of the Factory
- Prior Claims Experience
Have you selected the right Insurance Broker for Factory and Warehouse Insurance Policy?
An experienced Insurance Broker who understands the nuances of a Factory and Warehouse Insurance Policy is extremely important. Th broker will assist you in settling Factory Insurance Claims should such a need arise.
Here are a few key points to consider before choosing your Insurance Broker for Factory and Warehouse Insurance:
- Former and Current Clients
- Experience in Factory and Warehouse Insurance
- Experience in settling Factory and Warehouse Insurance Claims specific to your Industry
An experienced Insurance Broker will educate the client regarding the multitude of risks faced by the factory owner and proactively seek to mitigate such risks by means of incorporating appropriate clauses and add-on covers in the insurance policy.
Don’t just look to save costs on your Factory and Warehouse Insurance Policy. An experienced Insurance Broker may well be worth the extra price and peace of mind.
If you wish to purchase an Insurance Policy for your factory, Qian is a licensed insurance broker for Factory Insurance Policy in India. You can email us at insurance@qian.co.in or call us on 022-22044989. We would be glad to assist you with a Free Consultation for your Factory Insurance Policy.
- Factory and Warehouse Insurance Policy
- What is the need for a Factory Insurance in India?
- What are the coverages under a Factory and Warehouse Insurance Policy?
- What can be covered under a Factory and Warehouse Insurance Policy in India?
- What are the different types of Factory & Warehouse Insurance Policies?
- What factors can help reduce premium under Factory and Warehouse Insurance?
- What is the cost of a Factory and Warehouse Insurance Policy?
- What are the exclusions under a Factory and Warehouse Policy?
- How to claim under a Factory and Warehouse Insurance Policy?
- Get Best Factory and Warehouse Insurance Policy Quotes with Qian