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Fire Insurance

It is same as Fire & Allied Perils Insurance. But it is specially designed to offer such insurance to the interested buyer at a cost effective way. For this package insurance, six (06) different perils including ‘Fire’ have to be taken and insured value should not be less than Tk. 20 crore for each business/project/ manufacturing plant. 

Industrial All Risks Insurance is an improved version of Fire & Allied Perils Insurance, is specially designed to offer more risks coverage at a relatively low premium rate. To qualify for this insurance, asset value for insurance/sum insured should be not less than Tk. 50 crore.

It is simply a Fire Insurance or Fire & Allied Perils Insurance with a separate “Declaration Clause”. It means, when a Fire Insurance or Fire & Allied Perils Insurance is issued with a separate “Declaration Clause”, it becomes a “Declaration” based insurance. As per “Fire Tariff” use of which mandatory here in Bangladesh, general rules and regulations for issuing “Declaration” basis are as follows:

(a)  Tk.10 lacs in the case of General Merchandise including Yarn, Textiles and jute Finished goods.
(b)  Tk.30 lacs in the case of Cotton, Cotton Seeds, Jute, Tea or Wool.

The main advantage of such Declaration based Insurance is that Insured initially pays provisional premium which is 75% of 100% Annual Premium. This is adjusted at the end of the annual period of the policy subject to insured’s written declaration of stock at an agreed interval; commonly on monthly basis.
Insured pays additional premium or receives refund premium as per outcome of the adjustment done in view of relevant conditions of the “Declaration Clause”


Insurance Policy is an evidence of insurance contract. This insurance contract is made between the Insured/Policy-holder and Insurance Company. Subject to the terms & conditions of the policy, the insurance company indemnifies the Insured/Policyholder so that property damaged by insured event can be restored to its former position. Insurance Company provides this insurance coverage in exchange of money which is called ‘premium’ for certain period; usually one (01) year.

Why Fire Insurance is Important?

Fire insurance is a legally enforceable contract between a party called ‘Insured’ and the insurance company called ‘Insurer’. Under the terms & conditions of the contract, insurance company ensures the Insured in exchange of premium that the Insured will be indemnified for loss or damage to the insured due to fire &/or lightning.

Following insurance policies are available under fire insurance class of business.

Fire with covering more risks with an Additional premium is called Fire & Allied insurance. Additional Risk coverage like as (R&SD, Cyclone, Flood & explosion etc.)

Power Plant & Operational
Package Insurance:

All Risks of Physical loss or damage including Machinery Breakdown to the property of the insured used in connection with the insured Business.

Covers loss of Revenue, additional expenditure incurred for avoiding or minimizing loss and interest charges payable on loans raised due to an interruption or interference of insured business following loss or damage to insured property if indemnifiable under property damage section of the policy.

Cost of Insurance means the amount of money that the clients pay to buy their desired insurance. This cost of insurance includes Premium, VAT and Stamp Duty in common.

Fire Premium rate is taken from the Fire Tariff. Premium rate depends on Risk Coverage and Nature of risk as well.

Premium: Sum Insured (Insured Value) x

Premium Rate (Depends on mainly risk coverage)

xxxxx

(+) VAT (Premium x 15%)

xxxxx

Total Payable Amount   

xxxxx

Fire Insurance:

Annual Report