Hidden warranties in Fire policy
Before the de-tariffing of Fire rates, the policy wordings of almost all insurer’s, used to be mostly uniform. However, in today’s scenario of cut throat competition, majority of insurer’s while sending the quotes, silently incorporate such conditions, which may have terrible impact on claim settlement. A few of such anomalies in quotes are: 1-Open storage warranty :The policy to be issued is for goods in open but the warranty says “Goods in open not held covered “.
2-Adequate number of hand held extinguishers and hydrants as per TAC guidelines: Although extinguishers are required but how many? Not specified. Also hydrants may not be required or cost effective in small units. One claim was settled on non-standard basis, since hydrant was not installed but the insured won in court.
3 -Earthquake risk not required for goods in open : Why insurer is suggesting on its own? Let the insured not opt certain risk. There are numerous such warranties incorporated in quotes, which may go unnoticed, unless read and pointed out by an insurance expert. Insurance Brokers plays very important under this situation.