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The New India Assurance Company Limited Head Office: 87, M G Road, Fort, Mumbai-400001 PROPOSAL FORM FOR MACHINERY LOSS OF PROFITS INSURANCE Name of the Proposer: __________________________________________ Postal Address: _______________________________________Tel. No.________ Works Address: ____________________________________Tel No.___________ Trade of Business: ____________________________________________ 1. Do you wish to cover the risk of Loss of profit arising from. a. Machinery breakdown in your premises, If so complete Schedule A. b. Boiler and Pressure Plant explosion in your premises, if so complete Schedule B. c. Accidental Failure of Public supply of electricity water (in case you require this to be covered a supplementary from has to be filled in) 2. a. Do the lists of the machinery in the Schedule A and B represent the whole or only a part of the machinery in the premises. b. Any circumstances which render the risk more hazardous? c. Are all or any of your machines subject to periodical inspection? If so state by whom and at what intervals inspections are carried out? Supply details of your maintenance Schedule. 3. Which machines proposed under this insurance are the machines for which the spare parts would need to be imported. 4. Give a description of the manufacturing process and details of utility supplies such as power, steam air and water etc. required for production. 5. Please attach process flow diagram showing the connected machinery and indicate bottlenecks buffer stocks if any. 6. Please attach separate line diagram for utility supplies such as power steam, air and water showing interconnected machinery. 7. In the event of stoppage of any of the machines proposed: a. Can machines which remain in operation carry the load originally borne by the machines which has failed? b. Are there any alternative means of maintaining production? i. The work being done at other premises and to what extent? ii. By suitable replacement machines hired temporarily. 8. a. What machines are available as stand by in your works. b. Which machines are available for immediate use and to what extent they could maintain the production of the items. Which they replace (% of usefulness to be mentioned in the schedule separately) 9. a. What repair facilities are there in your premises? b. What are the local repair facilities? 10. Is there any possibility of spoilage of material in process in the event of a breakdown of failure of utility supplies? If so, state how this interruption may subsequently affect after resumption of normal production. 11. Give brief details of your past experience and the number of years with this type of industry. 12. a. What are your normal working hours? Are there regular night shifts? b. How many shifts per day? c. Working days per year? d. Can extra shifts be worked to make up production loss? 13. If business is “seasonal” indicate the period of high and low output or turnover and indicate the degree of fluctuation. State if there is a tendency of fluctuations due to demands. 14. State what terms are required for Loss of Profits Insurance with regard to a. Indemnity period (max 12 months) Note: The Indemnity period should be selected based on an estimate of the maximum time which would be required to resume work after a serious accident. b. The time Exclusion (Min. 7 days) Note: The period immediately following a breakdown and/ or explosion and for which claims are not payable in terms as time exclusion. 15. INSURED STANDING CHARGES: - Please Indicate Expenses to be insured- delete or supplement as appropriate Interest on debenture mortgage Motor Unkeep and licenses: Lighting Heating, Power and Water Loans and Bank overdraft Charges: Director’s fees and remunerations Office Expenses: Taxes (other than chargeable of profits) Salaries including National Insurance Contribution: Insurance premium Contributions to pension fund Telephone Rentals Miscellaneous Charges (not Exceeding 5% of the total amount of the aforesaid Standing Charges) Travelling Expenses Advertising Cost Auditors and legal fees Trade and Charitable Subscriptions Repairs and Renewals chargeable to revenue accounts Miscellaneous charges Depreciation of Building Machinery Plant and Motor Vehicle 16. State the Sum Insured on Gross Profit under the Loss of Profit Policy ( This Gross Profit for the current financial year to be computed from the annual balance sheet with adjustment for upward or downward trend of business for the period of Insurance) N.B. Gross Profit in Rs. ______________ 17. Are your books regularly audited: a. If so, give names and address of your auditors: _________________________ _______________________________________________________________ b. When does your financial year end: ____________________________________ c. Date on which insurance be renewable:________________________________ N.B. Date & month after the end of the financial year is recommended. 18. Is the machinery specified in the Schedule insured under the Machinery breakdown and/or Boiler Explosion Policy. If so, give the name of the Company and Policy No. 19. Are you Insured or have you made a proposal in respect of Loss of Profit following Machinery Breakdown and/or Boiler Explosion and/or Failure of Public Electric supply and/or water supply. If so, give name of the Company concerned and state whether any such proposal or renewal has been (a) declined (b) subjected to increased rates or special conditions. 20. Have you ever suffered loss of profit following machinery breakdown and or Boiler Explosion and/or Failure of Public Supply of Electricity and/or Water? Give details of the cause duration and cost of each stoppage during the past 3 years. 21. Are you insured against Loss of Profit following fire and if so, state the sum insured and the name of the Company and Policy No. SCHEDULE Period of Insurance will be from the agreed time of commencement date till midnight of the date of expiry. I/We HEREBY DECLARE AND WARRANT that the above statements are true and complete and that I/We have withheld on information whatsoever which is material for the acceptance of this proposal. I/ We agree that declaration and the answers given above shall be the basis of the contract between me/us and the Company and shall be deemed to be incorporated in such contract. And that if any untrue statement he contained therein the said contract shall be absolutely null and void. I/We undertake to exercise all reasonable precautions for the safety of machinery and I/We agree to accept the policy in the form issued by the Company subject to the terms, exceptions and conditions prescribed or endorsed on the policy. Place: _____________ Date: ______________ Signature: ________________ The liability of the Company does not commence until this proposal has been accepted by the Company and the premium paid. N.B. If insufficient space above for any answer please continue on separate sheet and attach hereto. Please answer in a separate sheet incase the space provided against each question is insufficient. Explanatory Note: Standard Machinery Loss of Profit Policy cover Loss of Gross Profit arising from breakdown or explosion of insured machinery or boilers and pressure vessels. It does not cover Loss of Profit arising from damage to Owner’s Surrounding Property (including machinery insured under machinery policy) caused by explosion. PROHIBITION OF REBATES: The following is an extract of Section 41 of Insurance Act 1938 1. No person shall allow or offer to allow, either directly or indirectly, as an inducement to any person to take out or renew or continue an Insurance in respect of any kind of risk relating to lives or property in India, any rebate of the whole or part of the commission payable or any rebate of the premium shown in the policy; nor shall any person taking out or renewing continuing a policy accept any rebate, except such rebate as may be allowed in accordance with the published prospectuses of rebates of the Insurer. 2. Any person making default in complying with the provisions of this section shall be punishable with fine which may extend to five hundred rupees. SCHEDULE OF ITEMS TO BE INCLUDED IN THE MACHINERY LOSS OF PROFIT INSURANCE PROPOSAL (1) (2) (3) (4) Particulars of Function (i.e. Relative Country of Machine and/or nature of work Importance Manufacturer Vessel. (Refer) performed) see Note (D) Name of the (5) (6) It is under Are you aware manufacture of defect in the Guarantee machinery (If Note[a] Manufacturer See Note (C) If so upto what date so please state details) SCHEDULE ‘A’ (Machinery insured under Machinery Insurance Policy) SCHEDULE ‘B’ (Boilers and Pressure Plant insured under Explosion Policy) Notes: a. The particulars of the machine should be as informative as possible including description year of manufacture type, performance speed number of cylinders, transmission ratio of gearings, voltage, pressure, and temperature heating surfaces etc. Auxiliary equipment such as gearing drivings units and switchgears etc. should be listed separately. b. Spare machine should be marked and their sphere of utility indicated. c. Any machine of foreign manufacture should be noted, unless their importance from the point of view of production is negligible. d. Relative importance is the maximum percentage effect which breakdown of particular machine will have on the total Gross Profit disregarding any loss of minimization measures. e. In the event of a breakdown state whether production can be maintained and to what extent by i. additional load on other machines ii. working in other premises. iii. Use of hired machinery. f. State whether machine is prototype or of latest design. Date of last inspection and any defects noted should be mentioned. Also state whether any special operating media is used. (7) Did the Machinery suffer any damage or breakdown in the last 3 years. If so, state the nature of breakdown, time taken for repairs and who carried out the repairs (8) (9) (10) What spare parts State alternative of stand by do your means of working Remarks hold for the in the event of see note[f] machinery see Note (b)breakdown (see note [e] ) Imported Indigenous