S-Clauses95 Views
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  1. In the consideration of the premium by this Policy being provisional in that it is calculated on 75% of the sum insured hereby and is subject to adjustment on expiry of each period of insurance :

        The insured agrees to declare to the Insurer in writing the value of his stocks (other than retail), less any amount insured by policies other than declaration policies, on the following basis namely the average of the values at risk  during the amount and to make such declaration within  thirty days of the last day of the calendar month, such declaration to be signed by the  Insured or by a responsible person authorised to sign on his behalf.

        If other policies on a  declaration basis cover the stocks hereby insured the declaration shall  be made so as to apportion to each policy a share of the value of the stocks insured under such declaration policies, prorate to the respective amounts named in the policies.

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        In the event of a declaration not being made within the 30 days mentioned above then the  Insured shall be deemed to have declared the sum hereby as the value at risk.

        On the expiry of each period of insurance the premium shall be calculated at the rate quoted on the average sum insured, namely the total of the value declared or deemed to have been declared dividend by the number of declaration due to have been made. If the resultant premium be greater than the provisional premium the Insured shall pay the difference, if it be less the difference shall be repaid to the Insured but such repayment shall not exceed one third of the provisional premium.

  1. The basis of value for declarations shall be the market value and any loss hereunder shall be settled on the basis of the market value immediately anterior to the loss.

  1. If at the time of any loss, there be any other subsisting insurance or insurances on other than a declaration basis, whether effected by the Insured or by any other person or persons covering the stocks hereby insured, this policy shall apply only to the excess of the value of such stocks at the time of loss over the sum insured by such insurance  or insurances, and this Insurer shall not be liable to contribute more than that proportion of such loss which such exceeds (or, if there be other declaration insurances covering the same stocks a rateable proportion of such excess), but not exceeding the sum insured hereby, bears to the total  value of the stock.

  1. If after the occurrence of a loss it is found that the amount of the last declaration previous to the loss is less than the amount that ought to have been declared then the amount which  would have been recoverable by the Insured shall be reduced in such proportion to the  amount of the said last declaration bears to the amount that ought to have been declared.

  1. Notwithstanding the occurrence of a loss it is understood that the sum insured will be maintained at all times during the currency of the Policy and the Insured therefore undertakes to pay extra premium on the amount of any loss prorata from the date of loss to the  expiry of the period of insurance, the premium being calculated at the rate applicable to the  stock destroyed and such extra premium shall not be taken into account in , and shall be  distinct from the final adjustment of premium.

  1. In the event of this policy being cancelled by the Insured during  its currency (whether stocks exit or not) the premium to be retained by the Insurer shall be the appropriate short period premium calculated on the average amount insured up to the date of cancelment, or 50% of  the provisional premium whichever is the greater but if cancelled by the Insured after a loss has occurred the premium to be retained by the insurer shall be the prorata  proportion of the premium calculated on the average amount insured on the date of cancelment plus the prorata proportion if the premium the date of loss to the expiry of  the period of insurance on the amount of the loss paid, 50% of the provisional premium whichever is the greater.

  1. The maximum liability of the Insurer shall not exceed the sum insured hereby and premium shall not be receivable on values insured thereof. The sum insured may, however, be  increased by prior agreement with the Insurer in which event the new sum insured and the  date from which it is effective will be recorded on the policy by endorsement.

  1. If the stocks hereby insured shall at the time of loss be collectively of greater value than the sum insured thereon, then the Insured shall be considered as being own insurer for the difference and shall bear a rateable proportion of the loss accordingly. Every time, if more than one Sum Insured exit on stocks (other than retail) it shall be separately subject to this conditions.

  1. It is warranted that every other policy on a declaration basis covering the stocks insured hereby shall be identical in wording with this policy.

  1. This insurance is subject in all respect to the printed conditions of the Policy except in so far as they may be varied by these special conditions.
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  1. If stock policy is issued on declaration basis, then why the clause 8 is applied for difference of sum insured and value at risk, so that the client may be stood his own insurer for difference amount. Then, what is the purpose and benefit of stock declaration clause.

  2. Hi Aamir, the benefit to the client is that they are paying partial premium on declaration. The declared value should be the maximum amount at risk throughout the policy lifetime. The insured benefit by paying only a partial premium on the declared value. In a perfect scenario if the actual stock value go above the sum insured valued, endorsement should be made for the adjustment. Nevertheless there are co-insurance clauses that the insured can rely on in an event that a claim happened and the stock value is higher than what was declared.


    The benefits of having this Endorsement attached to the Policy :
    To safe the premium, To avoid (paying over premium) for over-insurance
    BUT principles of Average (Under-insurance) apply
    Insurers shall limit their maximum liability as per TSI

  3. I agree with Aamir – I thought the whole point of the stock declaration basis is to make provision for fluctuations in the sum insured. The client just gives an estimated max value, but he is also not sure – it can be more or less sometimes – and that is the reason for insuring it on a stock declaration basis. But now the client gets penalized if the sum insured is more one month and a claim occurs in that month.

    That’s NOT the rule of this Endorsement.
    The benefits of having this Endorsement attached to the Policy :
    To safe the premium, To avoid (paying over premium) for over-insurance
    BUT principles of Average (Under-insurance) apply
    Insurers shall limit their maximum liability as per TSI