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PRODUCTS LAIBILITY INSURANCE This policy covers all sums (inclusive of defence costs) which the
insured becomes legally liable to pay as damages as a consequence. This policy covers all sums (inclusive of defence costs) which the
insured becomes legally liable to pay as damages as a consequence of:
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Accidental death / bodily injury or disease to any third party.
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Accidental damage to property belonging to a third party.
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Arising out of any defect in the product manufactured by the insured
and specifically mentioned in the policy after such product has left the
insured's premises.
The policy offers the benefit of retroactive period on continuous
renewal of policy where by claims reported in subsequent renewal but
pertaining to earlier period after first inception of policy, also
become payable. SCOPE The defect in the product may be a manufacturing defect or may even be
due to faulty packaging, delivery specifications or instructions as to
use of the product. The policy covers the sales turnover of the company - both domestic
and / or exports.
The policy is on a claims made basis i.e. the claims must arise and be
made in writing on the insurance company during the policy period. The policy does not cover any liability for product recall, product
guarantee, pure financial loss such as loss of goodwill or loss of
market. The policy also does not pay for the cost incurred for repairing
or reconditioning or modifying the defective part of the product. ADD ON COVERS The policy can be extended to cover liability arising out of judgments
or settlements made in countries which operate under the laws of U.S.A
or Canada (which is an exclusion under the policy) by opting for the
North American Jurisdiction Clause. The policy can also be extended to cover Limited Vendors Liability for
named or unnamed vendors. Limited vendors liability means liability
arising out of the sale and distribution of named insured products by
vendors with original warranties and instructions of use of the product
specified by the manufacturers.
WHO CAN TAKE THE POLICY The policy can be taken by the manufacturer of any product whether it be
the final product or part of the final product.
HOW TO SELECT THE SUM INSURED In Product Liability Policy, the sum insured is referred to as Limit of
Indemnity. This limit is fixed per accident and per policy period which
is called Any One Accident (AOA) limit and Any One Year (AOY) limit
respectively. The ratio of AOA limit to AOY limit can be chosen from the
following:
a. 1:1 b. 1:2 c. 1:3 d. 1:4
The AOA limit which is the maximum amount payable for each accident
should be fixed taking into account the nature of product covered and
the maximum number of people who could be affected and maximum property
damage that could occur, in the worst possible accident after sale of
the product. HOW TO CLAIM In case of any event likely to give rise to a liability claim as
described above, insurance company should be informed immediately. In
case any legal notice or summons is received, it should be sent to the
insurance company. The company has the option of arranging the defence
of the case. The event giving rise to the claim should have occurred during the
period of insurance or retroactive period and the claim first made in
writing against the insured during the policy period. The maximum amount
payable including defence cost will be the AOA limit selected. The Any
One Year limit will get reduced by the amount of claim or indemnity paid
for any one accident. Any number of such claims made during the policy
period will be covered subject to the total indemnity not exceeding the
Any One Year limit.
PROFESSIONAL INDEMNITY INSURANCE This policy is meant for professionals to cover liability falling on
them as a result of errors and omissions committed by them whilst
rendering professional service. This policy is meant for professionals to cover liability falling on
them as a result of errors and omissions committed by them whilst
rendering professional service. The policy offers a benefit of retroactive period on continuous renewal
of policy whereby claims reported in subsequent renewal but pertaining
to earlier period after first inception of the policy, also become
payable. Group policies can also be issued covering members of one profession.
Group discount in premium is available depending upon the number of
members covered. SCOPE The policy covers all sums which the insured professional becomes
legally liable to pay as damages to third party in respect of any error
and / or omission on his / her part committed whilst rendering professional
service. Legal cost and expenses incurred in defence of the case, with
the prior consent of the insurance company, are also payable, subject to
the overall limit of indemnity selected. Only civil liability claims are covered. Any liability arising out of
any criminal act or act committed in violation of any law or ordinance
is not covered. WHO CAN TAKE POLICY The policy is meant for professionals. We issue 'Professional Indemnity'
policies to the following group of professionals:
Doctors and medical practitioners - which covers registered medical
practitioners like physicians, surgeons, cardiologists, pathologists
etc. Medical establishments - which covers legal liability falling on the
medical establishment such as hospitals and nursing homes, as a result
of error or omission committed by any named professional or qualified
assistants engaged by the medical establishment. Engineers, architects and interior decorators. Lawyers, advocates, solicitors and counsels. Chartered accountants, financial accountants,
management consultants.
HOW TO SELECT THE SUM INSURED In Professional Indemnity Policy, the sum insured is referred to as
Limit of Indemnity. This limit is fixed per accident and per policy
period which is called Any One Accident (AOA) limit and Any One Year (AOY)
limit respectively. The ratio of AOA limit to AOY limit can be chosen
from the following:
a. 1:1 b. 1:2 c. 1:3 d. 1:4
The AOA limit, which is the maximum amount payable for each accident,
should be fixed taking into account the nature of activity of the
insured and the maximum number of people who could be affected and
maximum property damage that could occur, in the worst possible
accident. In the case of Professional Indemnity policy issued to engineers,
architects, interior decorators, lawyers, advocates, solicitors,
counsels, chartered accountants, financial accountants and management
consultants, the Any One Accident (AOA) limit is restricted to 25% of
the Any One Year (AOY) limit. PUBLIC LAIBILITY INSURANCE This policy covers the amount which the insured becomes legally liable
to pay as damages to third parties as a result of accidental death,
bodily injury, loss or damage to the property belonging to a third
party. The legal cost and expenses incurred in defending the case with
prior consent of the insurance company are also payable subject to
certain terms and conditions. One can insure more than one unit situated in different locations under
a single policy. The policy offers a benefit of Retroactive period on continuous renewal
of policy whereby claims reported in subsequent renewal but pertaining
to earlier period after first inception of the policy, also become
payable. This policy covers the amount which the insured becomes legally liable
to pay as damages to third parties as a result of accidental death,
bodily injury, loss or damage to the property belonging to a third
party.
SCOPE We issue three types of Public Liability Policies:
Public Liability Non Industrial Risk - for offices, hotels, cinema
houses, hospitals, schools etc. Public Liability Industrial Risk - for go downs, warehouses and
factories. Public Liability Insurance Act 1991 - this is a mandatory policy to be
taken by owners, users or transporters of hazardous substance as defined
under Environment (protection) Act 1986 in excess of the minimum
quantity specified under the Public Liability Insurance Act 1991.
ADD ON COVERS The Public Liability Policy can be extended to cover the following risks
on payment of an additional premium.
Natural calamities like flood, earthquake etc. Pollution Risk subject to NOC from Pollution Control Board. Transportation risk.
HOW TO SELECT THE SUM INSURED In Public Liability Policy, the sum insured is referred to as Limit of
Indemnity. This limit is fixed per accident and per policy period which
is called Any One Accident (AOA) limit and Any One Year (AOY) limit
respectively. The ratio of AOA limit to AOY limit can be chosen from the
following :
The AOA limit which is the maximum amount payable for each accident
should be fixed taking into account the nature of activity of the
insured and the maximum number of people who could be affected and
maximum property damage that could occur, in the worst possible accident
in the insured's premises. In the case of Public Liability Insurance Act 1991, the AOA limit should
represent the paid up capital of the company subject to maximum of Rs.5
crores. The AOY limit is fixed at 3 times the AOA limit (Max.Rs.15
Crores).
HOW TO CLAIM Legal liability under the Law of Tort ,can arise under several
circumstances in insured's premises such as:
Collapse of building structure. Accidental falling of fixtures. Bad maintenance or poor housekeeping resulting in accident to visitors
on the premises. Accidental leakage of toxic substance which pollutes the atmosphere
and injures or kills people.
The term "liability" means responsibility and "legal
liability" means responsibilities which can be enforced by law. Legal
Liability may be classified into Criminal Liability and Civil Liability.
Only Civil Liability claims are payable. Civil
Liability claims will arise if there is prima facie evidence of
negligence by the insured resulting in injury or death to any third
party or resulting in damage to property belonging to a person other
than insured, or in insured's custody. NEGLIGENCE PROVED
Injury suffered by a person or property damaged as a result of that
breach.
In case of any event likely to give rise to a liability claim as
described above, insurance company should be informed immediately. In
case any legal notice or summons is received, it should be sent to the
insurance company. The company has the option of arranging the defense
of the case. The event giving rise to the claim should have occurred during the
period of insurance or retroactive period and the claim first made in
writing against the insured during the policy period. The maximum amount
payable including defense cost will be the AOA limit selected. The any
one year limit will get reduced by the amount of claim or indemnity paid
for any one accident. Any number of such claims made during the policy
period will be covered subject to the total indemnity not exceeding the
Any One Year limit. In case of Public Liability Insurance Act 1991 Policy, any award which
exceeds the AOA limit will be paid by the government through Environment
Relief Fund to which the insured has to contribute an amount equivalent
to the premium paid under the Public Liability Insurance Act Policy. The policy will not pay for claims arising out of contractual liability,
intentional non - compliance of any statutory provision, loss of goodwill,
slander, fines, penalties, libel, false arrest, defamation, mental
injury etc.
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