INDUSTRIAL ALL RISK INSURANCE POLICY

SECTION I – MATERIAL DAMAGE

In consideration of the Insured paying to SBI GENERAL INSURANCE COMPANY LIMITED (hereinafter
referred to as the Company), the premium shown in the Schedule, the Company agrees (subject to
the terms, conditions and exclusions contained herein or endorsed or otherwise expressed hereon
which shall so far as the nature of them respectively will permit be deemed to be conditions
precedent to the right of the Insured to recover hereunder) that if after payment of the premium any
of the property insured be accidentally physically lost destroyed or damaged other than by an
excluded cause during the Period of Insurance or any subsequent period in respect of which the
Insured shall have paid and the Company shall have accepted the premium required for the renewal
of this Policy, the Company will pay to the Insured the value of the property at the time of the
happening of its accidental physical loss or destruction or damage (being hereinafter termed Damage)
or at its option reinstate or replace such property or any part thereof

Provided that the liability of the Company in respect of any one loss or in the aggregate in any one
Period of Insurance shall in no case exceed

i) As regards buildings, plants and machinery, furniture, fixture, fittings etc. the cost of
replacement or reinstatement on the date of replacement or reinstatement subject to the
maximum liability being restricted to the Sum Insured in respect of that category of the item
under the Policy.

ii) As regards stocks the market value of the same not exceeding the Sum Insured in respect of
that category of item under the Policy

EXCLUSIONS

A. EXCLUDED CAUSES

1) This Policy does not cover damage to the property insured caused by:

a) i) faulty or defective design materials or workmanship inherent vice latent defect gradual
deterioration deformation or distortion or wear and tear

ii) interruption of the water supply gas electricity or fuel systems or failure of the effluent
disposal systems to and from the premises

unless Damage by a cause not excluded in the Policy ensues and then the Company shall
be liable only for such ensuing Damage.

b) i) collapse or cracking of buildings

ii) corrosion rust extremes or changes in temperature dampness dryness wet or dry rot
fungus shrinkage evaporation loss of weight pollution contamination change in colour
flavour texture or finish action of light vermin insects marring or scratching

unless such loss is caused directly by Damage to the property insured or to premises
containing such property by a cause not excluded in the Policy.
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 c) i) larceny

ii) acts of fraud or dishonesty

iii) disappearance unexplained or inventory shortage misfiling or misplacing of information

shortage in supply or delivery of materials or shortage due to clerical or accounting error

d) i) coastal or river erosion

ii) normal settlement or bedding down of new structures

2) Damage caused by or arising from:-

a) any willful act or willful negligence on the part of the Insured or any person acting on his
behalf

b) cessation of work delay or loss of market or any other consequential or indirect loss of any
kind or description whatsoever

3) Damage occasioned directly or indirectly by or through or in consequence of any of the following

occurrences, namely:-

a) war invasion act of foreign enemy hostilities or warlike operations (whether war be
declared or not) civil war

b) mutiny civil commotion assuming the proportions of or amounting to a popular rising

military rising insurrection rebellion revolution military or usurped power

4) i) permanent or temporary dispossession resulting from nationalization commandeering or

requisition by any lawfully constituted authority

ii) permanent or temporary dispossession of any building resulting from the unlawful
occupation of such building by any person

provided that the Company is not relieved of any liability to the Insured in respect of
Damage to the property insured occurring before dispossession or during temporary
dispossession which is otherwise insured by this Policy

iii) the destruction of property by order of any public authority

In any action, suit or other proceeding where the Company alleges that by reason of the
provisions of Exclusions A3) a) and b) above any loss destruction or damage is not covered
by this insurance the burden of proving that such loss destruction or damage is covered
shall be upon the Insured.

5) Damage directly or indirectly caused by or arising from or in consequence of or contributed to

by: -

a) nuclear weapons material

b) ionizing radiations or contamination by radioactivity from any nuclear fuel or from any
nuclear waste from the combustion of nuclear fuel. Solely for the purpose of this Exclusion
Combustion shall include any self-sustaining process of nuclear fission.

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B. EXCLUDED PROPERTY

This Policy does not cover:

1) Money cheques stamps bonds credit cards securities of any description jewellery precious
stones precious metals bullion furs curiosities rare books or works of art unless specifically
mentioned as insured by this Policy

2) Unless specifically mentioned as insured by this Policy goods held in trust or on commission
documents manuscripts business books computer systems records patterns models moulds
plans designs explosives

3) a) vehicles licensed for road use (including accessories thereon) caravans trailers railway
locomotives or rolling stock watercraft aircraft spacecraft or the like

b) property in transit other than within the premises specified in the Schedule

c) property or structures in course of demolition construction or erection and materials or

supplies in connection therewith

d) land (including top-soil back-fill drainage or culverts) driveways pavements roads runways
railway lines dams reservoirs canals rigs wells pipelines tunnels bridges docks piers jetties
excavations wharves mining property underground off-shore property unless specifically
covered

e) livestock growing crops or trees

f) property damaged as a result of its undergoing any process

g) property undergoing testing installation including materials and supplies thereof if directly
attributable to the operations of work being performed thereon unless Damage by a cause not
otherwise excluded ensues and then the Company will be liable only for such ensuing loss

h) property more specifically insured

i) property insured if removed to any building or place other than which it is herein stated to
be insured, except machinery and equipments temporarily removed for repairs, cleaning,
renovation or other similar purpose for a period not exceeding 60 days.

j) damage to property which at the time of the happening of such damage is insured by or
would but for the existence of this Policy be insured by any marine policy or policies except in
respect of any excess beyond the amount which would have been payable under the marine
policy or policies had this insurance not been effected.

DEDUCTIBLES

This Policy does not cover the deductibles stated in the Schedule in respect of each and every loss as
ascertained after the application of all other terms and conditions of the Policy including any
condition of Average.

Warranted that during the currency of the Policy the Insured shall not effect insurance in respect of
the amount of the deductibles stated in the Schedule.

GENERAL CONDITIONS
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1. This Policy shall be voidable in the event of mis-representation, mis-description or non-disclosure
of any material particular.

2. All insurances under this Policy shall cease on expiry of 7 days from the date of fall or
displacement of any building or part thereof or of the whole or any part of any range of buildings
or of any structure of which such building forms part.

Provided such a fall or displacement is not caused by a peril not excluded by this Policy or such
loss or damage would be covered if such building, range of buildings or structure were insured
under this Policy.

Notwithstanding the above, the Company, subject to an express notice being given as soon as
possible but not later than seven days of any such fall or displacement may agree to continue
the insurance subject to revised rates, terms and conditions as may be decided by it and
confirmed in writing to this effect.

3. Under any of the following circumstances the insurance ceases to attach as regards the property
affected unless the Insured, before the occurrence of any loss or damage, obtains the sanction of
the Company signified by endorsement upon the Policy by or on behalf of the Company:-

a) If the trade or manufacture carried on be altered, or if the nature of the occupation or

other circumstances affecting the building insured or containing the insured property be
changed in such a way as to increase the risk of loss or damage by insured perils.

b) If the building insured or containing the insured property becomes unoccupied and so
remains for a period of more than 30 days.

c) If the interest in the property passes from the Insured otherwise than by will or
operation of law.

4. This insurance may be terminated at any time at the request of the Insured, in which case the
Company will retain the premium at customary short period rate for the time the Policy has been
in force. This insurance may also at any time be terminated at the option of the Company, on 15
days notice to that effect being given to the Insured, in which case the Company shall be liable to
repay on demand a rateable proportion of the premium for the unexpired term from the date of
the cancellation.

5. (i) On the happening of any loss or damage the Insured shall forthwith give notice thereof to
the Company and shall within 15 days after the loss or damage, or such further time as the
Company may in writing allow in that behalf, deliver to the Company

a) A claim in writing for the loss or damage containing as particular an account as may be
reasonably practicable of all the several articles or items or property damaged or
destroyed, and of the amount of the loss or damage thereto respectively, having regard
to their value at the time of the loss or damage not including profit of any kind.

b) Particulars of all other insurances, if any.

The Insured shall also at all times at his own expense produce, procure and give to the
Company all such further particulars, plans, specification, books, vouchers, invoices,
duplicates or copies thereof, documents, investigation reports (internal/ external) proofs
and information with respect to the claim and the origin and cause of the fire and the
circumstances under which the loss or damage occurred, and any matter touching the
liability or the amount of the liability of the Company as may be reasonably required by
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 or on behalf of the Company together with declaration on oath or in other legal form of
the truth of the claims and of any matter connected therewith.

No claim under this Policy shall be payable unless the terms of this condition have been
complied with.

(ii) In no case whatsoever shall the Company be liable for any loss or damage after the
expiration of 12 months from the happening of the loss or damage unless the claim is
the subject of pending action or arbitration; it being expressly agreed and declared that
if the Company shall disclaim liability for any claim hereunder and such claim shall not
within 12 months from the date of the disclaimer have been made the subject of a suit
in a court of law then the claim shall for all purposes be deemed to have been
abandoned and shall not thereafter be recoverable hereunder.

6. On the happening of loss or damage to any of the property insured by this Policy, the Company
may –

a) enter and take and keep possession of the building or premises where the loss or
damage has happened,

b) take possession of or require to be delivered to it any property of the Insured in the

building or on the premises at the time of the loss or damage,

c) keep possession of any such property and examine, arrange, remove or otherwise deal
with the same,

d) sell any such property or dispose of the same for account of whom it may concern.

The powers conferred by this condition shall be exercisable by the Company at any time until
notice in writing is given by the Insured that he makes no claim under the Policy, or if any
claim is made, until such claim is finally determined or withdrawn, and the Company shall
not by any act done in the exercise or purported exercise of its powers hereunder, incur any
liability to the Insured or diminish its rights to rely upon any of the conditions of this Policy in
answer to any claim.

If the Insured or any person on his behalf shall not comply with the requirements of the
Company or shall hinder or obstruct the Company, in the exercise of its powers hereunder,
all benefits under this Policy shall be forfeited.

The Insured shall not in any case be entitled to abandon any property to the Company
whether taken possession of by the Company or not.

7. If the claim be in any respect fraudulent, or if any false declaration be made or used in support
thereof or if any fraudulent means or devices are used by the Insured or any one acting on his
behalf to obtain any benefit under the Policy or if the loss or damage be occasioned by the willful
act, or with the connivance of the Insured, all benefits under this Policy shall be forfeited.

8. If the Company at its option, reinstates or replaces the property damaged or destroyed, or any
part thereof, instead of paying the amount of the loss or damage, or join with any other company
or insurer in so doing, the Company shall not be bound to reinstate exactly or completely but
only as circumstances permit and in reasonably sufficient manner, and in no case shall the
Company be bound to expend more in reinstatement than it would have cost to reinstate such
property as it was at the time of the occurrence of such loss or damage nor more than the sum
insured by the Company thereon.
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 If the Company so elects to reinstate or replace any property the Insured shall at his own
expense furnish the Company with such plans specifications, measurement, quantities and such
other particulars as the Company may require, and no acts done, or caused to be done, by the
Company with a view to reinstatement or replacement shall be deemed an election by the
Company to reinstate or replace.

If in any case the Company shall be unable to reinstate or repair the property hereby insured,
because of any municipal or other regulations in force affecting the alignment of streets or the
construction of buildings or otherwise, the Company shall, in every such case, only be liable to
pay such sum as would be requisite to reinstate or repair such property if the same could
lawfully be reinstated to its former condition.

9. If the property hereby insured shall at the time of reinstatement/ replacement/ repair following a
loss or damage indemnifiable under the Policy be of greater value than the Sum Insured under
the Policy, then the Insured shall be considered as being his own insurer for the difference and
shall bear a rateable proportion of loss.

Each item of the Policy to which this condition applies shall be separately subject to the
foregoing provision.

Provided however that if the said Sum Insured in respect of such item(s) of the Schedule shall
not be less than 85% (Eighty Five percent) of the value of the item(s) thereat, this condition shall
be of no purpose and effect.

10. If at the time of any loss or damage happening to any property hereby insured there be any other
subsisting insurance or insurances, whether effected by the Insured or by any other person or
persons covering the same property, this Company shall not be liable to pay or contribute more
than its rateable proportion of such loss or damage.

11. The Insured shall at the expense of the Company do and concur in doing, and permit to be done,
all such acts and things as may be necessary or reasonably required by the Company for the
purpose of enforcing any rights and remedies or of obtaining relief or indemnity from other
parties to which the Company shall be or would become entitled or subrogated, upon its paying
for or making good any loss or damage under this Policy, whether such acts and things shall be or
become necessary or required before or after his indemnification by the Company.

12. If any dispute or difference shall arise as to the quantum to be paid under this Policy (liability
being otherwise admitted) such difference shall independently of all other questions be referred
to the decision of a sole arbitrator to be appointed in writing by the parties to or if they cannot
agree upon a single arbitrator within 30 days of any party invoking arbitration, the same shall be
referred to a panel of three arbitrators, comprising of two arbitrators, one to be appointed by
each of the parties to the dispute/ difference and the third arbitrator to be appointed by such
two arbitrators and arbitration shall be conducted under and in accordance with the provisions of
the Arbitration and Conciliation Act, 1996.

It is clearly agreed and understood that no dispute or difference shall be referable to arbitration
as herein before provided, if the Company has disputed or not accepted liability under or in
respect of this Policy.

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 It is hereby expressly stipulated and declared that it shall be a condition precedent to any right
of action or suit upon this Policy that the award by such arbitrator/ arbitrators of the amount of
the loss or damage shall be first obtained.

13. Every notice and other communication to the Company required by these conditions must be
written or printed.

14. At all times during the Period of Insurance of this Policy the insurance cover will be maintained to
the full extent of the respective sum insured in consideration of which upon the settlement of
any loss under this Policy, pro rata premium for the unexpired period from the date of such loss
to the expiry of Period of Insurance for the amount of such loss shall be payable by the Insured to
the Company.

The additional premium referred above shall be deducted from the net claim amount payable
under the Policy. Thus continuous cover to the full extent will be available notwithstanding any
previous loss for which the Company may have paid hereunder and irrespective of the fact
whether the additional premium as mentioned above has been actually paid or not following
such loss. The intention of this condition is to ensure continuity of the cover to the Insured
subject only to the right of the Company for deduction from the claim amount when settled of
pro-rata premium to be calculated from the date of loss till expiry of the Policy.

Notwithstanding what is stated above, the Sum Insured shall stand reduced by the amount of
loss in case the Insured immediately on occurrence of the loss exercises his option not to
reinstate the Sum Insured as above.

SPECIAL CONDITIONS TO SECTION I

1. Sums Insured

It is a requirement of this Insurance that the sums insured stated in this Schedule shall not be less
than the cost of reinstatement as if such property (other than for stocks) were reinstated on the
first day of the Period of Insurance which shall mean the cost of replacement of the insured items
by new items in a condition equal to but not better or more extensive than its condition when
new.

2. Basis of Loss Settlement

In the event of any loss destruction or damage the indemnification under this Section shall be
calculated on the basis of the reinstatement or replacement of the property lost destroyed or
damaged, subject to the following provisions:

2.1 Reinstatement or replacement shall mean:

1. where property is lost or destroyed, the rebuilding of any buildings or the

replacement of any other property by similar property, in either case in a condition
equal to but not better or more extensive than its condition when new.

2. where property is damaged, the repair of the damage and the restoration of the
damaged portion of the property to a condition substantially the same as but not
better or more extensive than its condition when new.
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 2.2 Special Provisions

1. The work of reinstatement (which may be carried out upon another site and in any
manner suitable to the requirements of the Insured subject to the liability of the
Company not being thereby increased) must be commenced and carried out within
12 months after the destruction or damage otherwise no payment beyond the
amount which would have been payable under the Policy if these Special Provisions
had not been incorporated herein shall be made.

2. Where any property is lost destroyed or damaged in part only the liability of the
Company shall not exceed the sum representing the cost, which the Company could
have been called upon to pay for reinstatement if such property had been wholly
destroyed.

3. Until the cost of reinstatement or replacement shall have been actually incurred the
amount payable under each of the items shall be calculated on the basis of the
actual cash value of such items immediately before the loss destruction or damage
with due allowance for depreciation for age use and condition.

3. Debris Removal

This Policy covers the necessary expense for removal of debris of insured property from the
described premises as a result of physical loss destruction or damage insured against under this
Policy.

The Company’s total liability for debris removal is limited to the amount entered in the Schedule.

SECTION II – BUSINESS INTERRUPTION

The Company agrees that if during the Period of Insurance the business carried on by the Insured at
all the premises specified & listed in the Schedule is interrupted or interfered with in consequence of
loss destruction or damage indemnifiable under Section I, then the Company shall indemnify the
Insured for the amount of loss as hereinafter defined resulting from such interruption or interference
provided that the liability of the Company in no case exceeds the total Sum Insured or such other sum
as may hereinafter be substituted therefor by Endorsement signed by or on behalf of the Company.

SPECIAL EXCLUSIONS TO SECTION II

1. This Policy does not cover loss resulting from interruption of or interference with the business
directly or indirectly attributable to

1.1 any restrictions on reconstruction or operation imposed by any public authority

1.2 the Insured’s lack of sufficient capital for timely restoration or replacement of property lost
destroyed or damaged

1.3 loss of business due to causes such as suspension lapse or cancellation of a lease licence or
order etc. which occurs after the date when the items lost destroyed or damaged are again
in operating condition and the business could have been resumed, if said lease licence order
etc. had not lapsed or had not been suspended or cancelled.

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 1.4 damage to boilers economizers turbines or other vessels machinery or apparatus in which
pressure is used or their contents resulting from their explosion or rupture.

1.5 electronic installations, computers and data processing equipment.

1.6 Damage resulting from:

a) deliberate erasure loss distortion or corruption of information on computer systems

or other records programs or software.

b) other erasure loss distortion or corruption of information on computer systems or

other records programs or software unless resulting from fire, lightning, explosion,
aircraft, impact by any road vehicle or animals, earthquake, hurricane, windstorm,
flood, bursting overflowing discharging or leaking of water tanks apparatus or pipes
in so far as it is not otherwise excluded unless caused by Damage to the machine or
apparatus in which the records are mounted.

1.7 mechanical or electrical breakdown or derangement of machinery or equipment.

2. This Policy does not cover the deductible stated in the Schedule to be borne by the
Insured.

BASIS OF INSURANCE

The cover provided under this Section shall be limited to loss of Gross Profit due to (a) Reduction in
Turnover and (b) Increase in Cost of Working and the amount payable as indemnity hereunder shall
be

(a) in respect of Reduction in Turnover:

the sum produced by applying the Rate of Gross Profit to the amount by which the Turnover
during the Indemnity Period shall fall short of the Standard Turnover in consequence of the
loss destruction or damage

(b) in respect of Increase in Cost of Working:

the additional expenditure necessarily and reasonably incurred for the sole purpose of
avoiding or diminishing the Reduction in Turnover which but for that expenditure would
have taken place during the Indemnity Period in consequence of loss destruction or damage,
but not exceeding the sum produced by applying the Rate of Gross Profit to the amount of
the reduction thereby avoided

less any sum saved during the Indemnity Period in respect of such of the charges and expenses of
the business payable out of Gross Profit as may cease or be reduced in consequence of loss
destruction or damage

provided that if the Sum Insured by this item be less than the sum produced by applying the Rate
of Gross Profit to the Annual Turnover (or to a proportionately increased multiple thereof where
the Maximum Indemnity Period exceeds twelve months) the amount payable shall be
proportionately reduced.

DEFINITIONS

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1. Gross Profit

The amount by which

- the sum of the amount of the Turnover and the amount the closing stock and work in
progress shall exceed

- the sum of the amounts of the opening stock and work in progress and the amount of
the Uninsured Working Expenses.

Note: The amounts of the opening and closing stocks and work in progress shall be arrived
at in accordance with the Insured’s normal accountancy methods, due provision
being made for depreciation.

2. Uninsured Working Expenses

The following variable expenses of the business are not covered by this Policy:

A. Turnover and purchase taxes

B. Purchases (less discounts received)

C. Carriage, packing and freight.

3. Turnover

The money (less discounts allowed) paid or payable to the Insured for goods sold and
delivered and for services rendered in the course of the business at the Premises.

4. Indemnity Period

The period beginning with the occurrence of loss destruction or damage and ending not later
than the Maximum Indemnity Period thereafter during which the results of the Business shall
be affected in consequence thereof. Provided always that the Company is not liable for the
amount equivalent to the Rate of Gross Profit applied to the Standard Turnover during the
period of Time Exclusion of --- days for FLOP and --- days for MLOP as stated in the Schedule.

5. Rate of Gross Profit to which such adjustment shall be made

The Rate of Gross Profit earned on the Turnover as may be necessary to provide for the
during the financial year immediately before the trend of business and for variations in or
date of loss destruction or damage other circumstances affecting the
Business either before or after loss
6. Annual Turnover destruction or damage or which would
The Turnover during the twelve months have affected the Business had the loss
immediately before the date of loss destruction destruction or damage not occurred, so
or damage that the figures thus adjusted shall

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 represent as nearly as may be reasonably
7. Standard Turnover practicable the results which but for the
The Turnover during the period in the twelve loss destruction or damage would have
months immediately before the date of loss been obtained during the relative period
destruction or damage which corresponds with after the loss destruction or damage.
the Indemnity Period appropriately adjusted
where the Indemnity Period exceeds twelve
months

PROVISIONS

Memo 1 – Benefits from Other Premises

If during the Indemnity Period goods are sold or services are rendered elsewhere than at the
premises for the benefit of the Business either by the Insured or by others acting on his
behalf, the money paid or payable in respect of such sales, or services shall be taken into
account in arriving at the Turnover during the Indemnity Period.

Memo 2 – Return of Premium

If the Insured declares at the latest nine months after the expiry of any Policy year that the
Gross Profit earned during the accounting period of twelve months most nearly concurrent
with any Period of Insurance, was less than the Sum Insured thereon a pro rata return of
premium not exceeding one third of the premium paid on such sum insured for such Period
of Insurance shall be made in respect of difference.

If any loss destruction or damage has occurred giving rise to a claim under this Policy, such
return shall be made in respect only of so much of said difference as is not due to such loss
destruction or damage.

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