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General Business PRIVATE INSURANCE: HOUSE OWNERS COMBINED (Buildings) Events Insured Against: (Buildings Only) (1) Fire, lighting, thunderbolt, explosion
(2)
Bursting or overflowing of water tanks, apparatus or pipes (excluding the
first (3) Aircraft or articles dropped therefrom. (4) Impact – buildings, walls, gates or fences by any road vehicle, horses or cattle not belonging to or under the control of the Insured or a member of his family. (5) Burglary or housebreaking or any attempt thereat except whilst the house is left unfurnished. (6) Earthquake (subject to an excess) (7) Gale, hurricane, cyclone or windstorm (subject to an excess)
(8)
Liability to the public arising out of the ownership of the property
including walls, gates, fences and trees up to Exclusions: (1) War and similar risks. (2) By cessation of work, commandeering, confiscation, requisition or destruction by order of the government or other public authority or to property by its own fermentation, natural heating or spontaneous combustion or by its undergoing any heating or drying process. (3) Loss of or damage caused by: a) Flood or overflow of the sea b) Tidal wave c) Gale, hurricane, cyclone or windstorm to any buildings in the cause of construction, reconstruction repairs unless the outside doors, windows and other openings thereto are complete and protected against such perils. d) Gale, hurricane, cyclone or windstorm to awnings blinds, signs or other outdoor fixtures and fittings. (4) Consequential loss or damage of any kind whatsoever. Exclusions to 8 above – liability to the public The insured or any member of his household or in his employment The insured profession or his business The use of lifts or vehicles The carrying out of alterations, additions, repairs or decorations to the premises. Liability arising under contracts of indemnity, which would impose upon the insured a greater liability than which he would otherwise have been under. Underwriting considerations: (a) The main risk is that of fire and special perils. A properly completed proposal is required to obtain a full appreciation of the risk. Some questions are designed to provide information about the proposer and his station in life. Other questions supply information about the premises nearby, its situation, construction and type of premises whether there are other premises nearby and whether it is in a good state of repair. (b) The last questions make enquiry into the proposers past insurance history and claim experience. (c) Normal fire underwriting considerations apply in respect of apartments or flats in a building so far as accommodation is concerned. Although this business has been considered non hazardous, there is now a tendency, world wide, for the hitherto excellent experience to deteriorate mainly due to fire and adverse weather conditions. (d) Impact sometimes happens that a property is situated, at what must be a dangerous place, near a highway and the property has been struck on a number of occasions in the past. If the experience indicates a number of prior impact claim the risk should be avoided. A major problem for the underwriter is to ensure the sum insured is adequate at inception of the policy and is increased annually to keep pace with inflation. To achieve this aim, we shortly intend to issue to the insured a form with a renewal notice, drawing the insured attention to the fact that due to the inflation the property (and the repair costs) has increased and urging him to amend the value in line with current market prices. It is important to realize that the sum insured for insurance proposal is not the price for what the building could be sold between a willing buyer and the seller (the annual estate agents basis of valuation) but the reinstatement or rebuilding cost in the event of total destruction. This value will depend on the nature and quality of construction if necessary the proper basis of valuation must be clearly explained to the proposer/insured. (e) Whilst in the event of a total loss we will not pay more than the total sum insured, there are very few total loss claims. There are far many more claims for partial losses where we pay for the cost of repair. Whilst by virtue of condition 2 of the policy we can apply “average” and only pay a proportionate part of the loss, we can only do this on comparatively rare occasions, when we can show the property is grossly under insured, many more claims are paid on current repair costs where it might be more difficult to prove – under insurance. We might have to pay for the services of a professional valuer and any savings on claims would be offset by the valuers’ fees and to dispute many claims could bring a bad reputation. The benefit obtained by having valuers in line with inflation means a larger premium income and a reduction in the claim loss ratio. (f) Any policy showing a number of claims should be specially scrutinized before renewal to decide whether action needs to be taken before inviting renewal. (g) If the building is not of massive construction and in good repair, care must be taken in acceptance, if for example the roof was of rusted corrugated iron and badly secured this could blow off during the first storm and also cause internal damage to the dwelling. Underwriting action must be taken either by increasing the premium or limiting cover until such time as repairs have been satisfactorily carried out or declining the risk. Wooden dwellings must be declined. (h) Remember condition 10 of the policy demands the insured shall keep the premises in good repair and the policy is rendered inoperative if the insured fails to repair when a defect occurs, after receiving notice of a defect from the company or any other person or public body. RATING: Rate – 25% HOUSEHOLDERS COMBINED (Contents) Introduction: It is necessary to read the house owners instructions because the two covers are similar (although with slight variations). The house owners’ policy can apply to protect a landlord who owns the premises but does not occupy them. The householders’ policy covers the contents owned by the occupier of the premises. The owner-occupier would require to be covered by both policies. Remember the householders’ policy covers the contents not the buildings. Events Insured Against (Contents only): (1) Fire, lightning, thunderbolt, explosion (2) Bursting or overflowing of water tanks, apparatus and pipes but excluding damage caused thereto. (3) Aircraft or articles dropped therefrom (4) Burglary or housebreaking only following forcible entry by violence or any attempt thereat. (5) Gale, hurricane, cyclone or windstorm (6) Earthquake (7) Flood including overflowing of the sea. (8) Impact with any of the buildings by any road vehicle or horses or cattle not belonging to or under the control of the insured or a member of his family. (9) Loss or damage to buildings or landlords fixtures and fittings. (10) Liability to the public arising out of the occupation of the property in or about the occupied premises. (11) Compensation for death of insured up to N20,000 or half the value of the content whichever is the less caused by burglars, housebreakers or by fire occurring in the premises, this cover also includes the insured’s wife. Exclusions: (1) Property outside the Federation of Nigeria (2) War and similar risks. (3) By cessation of work or confiscation commandeering requisition or destruction by the order of the Government or other public authority or to property by its own fermentation, natural heating spontaneous combustion or by its undergoing any heat or drying process. (4) Consequential loss or damage of any kind (5) Exclusions only to 9 above a) The insured or any member of his household or in his employment. b) The insured’s profession or business c) Use of lifts or vehicles d) The carrying out of alteration, addition, repairs or decorations to the premises. Underwriting Considerations: The major hazard in respect of the contents is by theft and most contents claim are in respect of theft, fewer claims are in respect of fire or other perils. The contents policy does provide cover in respect of flood including inundation by the sea. Prudence and judgment must be exercised to avoid risks where these is a known flood hazard. Proposals should be properly completed before a proper assessment can be made of the risk. The proposal answers provide details of the property, its situation and construction in which the property will be kept. Full details of the contents to be insured should be given with values, together with the details of the proposer’s past insurances and claims records. The problem of inflation and the need for constant revision of the sum insured is shown in the underwriting considerations for house owners insurance together with the risk of impact and you must re-read these instructions. Remember, contents kept in non-massive premises are not covered by the terms of the specifications in the schedule unless specially declared. Contents kept in non-massive structures may require additional premium or special security, but there would be little objection to covering for a modest amount, gardening tools and similar items in a garden shed. The underwriter should be satisfied that the value of the content is reasonable and befits the proposers station in life. One would expect that the contents of a merchant’s house would be of a greater value than that of his clerk. The security of the premises is of great importance for contents insurance where burglary is the main hazard, and adequate locks, bolts and bars should be fitted to windows, doors and other points of possible entries by thieves. Enquiry should be made as to whether there are regular periods of absence from the premises. A house where both husband and wife are out working each day is less secured than made when dealing with expatriates, because of leave periods the house may be unoccupied for considerable periods each year and the underwriter must be assured that security will be maintained during absence. If the main building is of substandard construction the risk should be avoided. Rating: Building – 0.3% Content – 1% |
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