Bharat Laghu Sookshma Udyam Suraksha

This policy is applicable for Offices, Hotels, Shops, Industrial/Manufacturing risks, Utilities located outside the compound of Industrial/ Manufacturing risks, Storage risks outside the compound of Industrial/ Manufacturing risks and Tank farms/Gas holders outside the compounds of Industrial/ Manufacturing risks where the total value at risk across all insurable asset classes at one location does not exceed ₹ 5 Crore (Rupees Five Crore) at the policy commencement date. These include buildings, plant and machinery, stock, and all other assets. If value of Insurable Assets exceeds ₹ 5 Crore during the Policy Period Policy will continue till the expiry. However, on renewal it must be replaced with the applicable policy.

Scope of Cover

Policy will cover physical loss or damage, or destruction caused to the Insured Property:

By Fire, including due to its own fermentation, or natural heating, or spontaneous combustion.

Explosion or Implosion, Lightning, Earthquake, volcanic eruption, or other convulsions of nature.

Storm, Cyclone, Typhoon, Tempest, Flood and Inundation etc., Subsidence of the land on which the Premises stand, Landslide, Rockslide, Bush fire, Forest fire etc, Impact damage of any kind, Missile testing operations, Riot, Strikes, Malicious damages, Acts of terrorism, Bursting or over-flowing of water tanks, apparatus and pipes, Leakage from automatic sprinkler installations.

Theft within 7 days from the occurrence of, and proximately caused by, any of the above Insured Events.

Key Features

This Policy gives two types of covers:

Standard Cover for the building and structures, plant and machinery, stock and other assets relating to the business.

In-built Covers: under the Standard Cover if Insurer agree to pay the claim for loss or damage to Insured Property, Insurer will also pay for the following loss or damage and expenses.

Additions, alterations, or extensions: Property that You erect, acquire, or add during the Policy Period is covered up to 15% of the sum insured for that item. (Excluding Stocks)

Temporary removal of stocks: Loss to stocks temporarily removed to other premises for fabrication, processing or finishing up to 10% of value.

Cover for Specific Contents: Cover for money up to ₹50,000 (Rupees Fifty Thousand) cover for documents such as deeds, manuscripts, business books, plans, drawings, securities etc. up to ₹50,000 (Rupees Fifty Thousand) cover for computer programmes, information and data upto ₹5 Lakh (Rupees Five Lakh) and cover for personal effects of employees, Directors and visitors up to ₹15,000 ( Rupees Fifteen Thousand) per person for a maximum of 20 (twenty) persons during the policy period.

Start-Up Expenses: Start-up cost incurred consequent upon a loss or damage due to insured events up to ₹ 1 Lakh (Rupees one Lakh) during the policy period.
Professional fees: Reasonable fees of architects, surveyors and consulting engineers up to 5 % of the claim amount.

Costs for removal of debris: Reasonable expenses for removal of debris up to 2% of the claim amount.

Costs compelled by Municipal Regulations: Additional cost of reconstruction of property incurred solely for complying with municipal regulations.

Standard Add-ons:

Declaration Policy for Stocks on Payment of additional Premium

Basis of Sum Insured:

All Building/ Structure, Plant & Machinery, Furniture & Fixtures shall be insured on Reinstatement Value/Replacement Value basis only.

There is no option to insure on market value basis.

Stocks of raw material shall be covered on Landed Cost at the insured’s premise.

Stocks in process shall be covered at Input Cost of the stock.

Finished goods shall be insured for the Manufacturing Cost or the Contract Price of goods sold but not delivered.

In respect of finished goods sold but not delivered, where under the conditions of sale, the sale contract is cancelled by reason of any damage insured under the policy either wholly or to the extent of the damage, the Sum Insured shall be based on the Contract Price.

Underinsurance upto 15 % of Sum Insured is waived, but beyond that underinsurance is applicable to the full extent.

Valued policies can be allowed only for properties such as Curios, Works of Art, Manuscripts, Obsolete machinery and the like subject to the valuation certificate being submitted and found acceptable by the insurers.

Policy Excess: ₹ 5,000 (Rupees Five Thousand) for each claim.
For terrorism risk Excess will be as per the clause attached to the policy.

It is not permissible:

To issue a policy beyond 12 months..

It is not permissible to cover only certain portions of the building.

To issue a policy covering only specified machinery (except Boilers), parts of machine or accessories thereof housed in the same block/ building.


Deliberate, wilful or intentional act.

Loss, destruction, or damage to stocks in cold storage due to change in temperature.

War, invasion, war-like operations, Ionising radiation.

Pollution or contamination, Consequential or indirect loss or damage, Costs, fees or expenses for preparing any claim.

Insured premised or building remains unoccupied for more than 30 days.

Bullion or unset precious stones, any curious or works of art unless specifically declared.

Loss, damage or destruction to any electrical/electronic machine, apparatus, fixture, or fitting by over-running, excessive pressure, short circuiting, arcing, self- heating or leakage of electricity from whatever cause (lightning included). This exclusion applies only to the particular machine so lost, damaged or destroyed.