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Fire Loss of Profit Insurance (FLOP)

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Fire Loss of Profit Insurance (FLOP)

Fire Loss of Profit (FLOP) is also called as Business Interruption (BI) Insurance cover or consequential loss (fire) policy :

  • Fire Loss of Profit (FLOP) policy covers Loss of Gross Profit and/or increase in cost of working due to reduction in turnover/output due to operation of peril covered in the Standard Fire & Special Perils Policy (SFSP).
  • Fire Loss of Profit cover would become operative only when there is a Material damage loss in Standard Fire & Special Perils Policy (SFSP) is payable due to covered perils like Fire, Lightning, Riot & Strike Malicious damage, Storm, Tempest, Flood, Inundation
  • To claim under Business Interruption (BI) there should be an admissible claim under Fire policy
  • Gross Profit (GP) = Net Profit (NP) + Fixed costs (standing charges)
  • Increased cost of working
  • Gross Profit (GP) = Net Profit (NP) + Fixed costs (standing charges)
  • Increased cost of working
  • Various additional covers like Suppliers Premises, Customer Premises, Failure of Public utility of power / gas/water supply are also available as per requirement and on payment of additional premium.
  • Rating depends on:
    • Annual gross profit
    • Annual turnover
    • Business Interruption Sum Insured
    • Indemnity Period ( For e.g 6,9,12,15 months)
  • War, invasion, Act of foreign enemy, Hostilities or Warlike Operations (whether war be declared or not), Civil War, Mutiny, Civil Commotion assuming the proportion of or amounting to a popular rising, military rising, insurrection, rebellion, revolution, & military usurped power.
  • Nuclear power reactions and Radiations.
  • War, invasion, Act of foreign enemy, Hostilities or Warlike Operations (whether war be declared or not), Civil War, Mutiny, Civil Commotion assuming the proportion of or amounting to a popular rising, military rising, insurrection, rebellion, revolution, & military usurped power.
  • Nuclear power reactions and Radiations.
  • Good accounting process is a requirement.
  • Please go through the policy terms and conditions of the Insurance Company.


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