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MachineryLossOfProfits

Reliance General Insurance

Reliance Machinery Loss of Profit Insurance Policy Features

When critical machinery, boilers and pressure vessels in an industrial or manufacturing unit break down, regular operations can be thrown out of gear jeopardizing revenue streams. Reduced turnover along with the additional costs towards ensuring continuity of business are pertinent risks that need to be provided adequate protection. At Reliance, you have the right policy for losses occurring due to accidental physical loss or damage to machinery – the Machinery Loss of Profit Insurance Policy.​

Key Benefits

  • ​Specialized product covering financial loss upon breakdown or failure of important machinery
  • Offers exhaustive coverage for all risks associated with boilers, pressure plants and industrial machinery, along with the machinery breakdown policy
  • Extensions available to cover wages and auditor fees

​Few Definitions:

  • Gross Profit: Net Profit plus insured standing charges
  • Net Profit: Net Trading Profit less all capital receipts / accretions / outlays chargeable to capital less all standing and other charges including depreciation, before tax from specified business and specified premises
  • Trading Profits: Profits from selling goods dealt / manufactured and services rendered.
  • Standing Charges: All fixed costs incurred for proper business operations.
  • Turnover: Amount payable (less discounts) to the insured for sale of goods / services rendered in course of business at specified premises.
  • Indemnity period: Starts from the day of the accident and ends not later than the number of months indicated in the policy during which the business is affected
  • Lay off Wages: Payment to employees during the indemnity period for which no work was/ is available due to the accident

​Reliance Machinery Loss of Profit Insurance Policy Coverage

The policy covers your business against:

  • Loss of gross profit due to reduction in turnover / output.
  • Increased cost of working

Due to accidental damage to machinery/ boilers affected in the specified premise consequent upon the operation of an insured peril under the Machinery Insurance policy.

Sum insured is the Annual Net Profit plus Standing Charges based on the latest balance sheet figures adjusted to the expected trend in the forthcoming year of operations.

The policy is subject to adjustment of premium to the extent of difference between actual Gross Profit of the current financial year and estimated profits subject to a downward limit of 50 per cent.

​Special Features:

The policy provides for following extensions-

  • Wages
  • Auditors’ Fees

​Reliance Machinery Loss of Profit Insurance Policy Exclusions

The Reliance Machinery Loss of Profit Insurance Policy does not cover any loss resulting from interruption of or interference with the business directly or indirectly attributable to any of the following causes:

  • Willful act, neglect, or gross negligence of the insured or his responsible representatives.
  • Loss/damage caused by any faults/defects existing at the time of commencement of this insurance within the knowledge of the insured or his representatives
  • Shortage, destruction, deterioration, and damage of raw materials, semi finished or finished products, or catalyst or operating media
  • Any restrictions on reconstruction or operation imposed by any public authority.
  • Transport of parts to and from the insured’s premises.
  • Alterations, improvements, or overhauls being made while repairs or replacements of damaged or destroyed property are being carried out.
  • Loss, damage, and/or liability caused by, or arising from, or in consequence directly or indirectly of war or war like perils
  • An extension of the normal repair period for more than 4 weeks on account of -
    • The inability to secure or delays in securing replacement parts, machines or technical services
    • The inability to carry out or delays in carrying out repairs.
    • A prohibition to operate the machinery due to import and/or export customs and other restrictions or by statutory regulations.