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Fire Insurance Policy Clauses (Part-10).

Byline: Majid Khan Jadoon

Standard Explosion Endorsement: By attachment of this Endorsement on the Fire Insurance Policy, the Insurers and the Insureds mutually agree and declare that any Loss or Damage to the Property, which would have been caused by Fire or otherwise directly caused by Explosion, shall be deemed included within the ambit of the same Fire Insurance Policy.

This will, however, exclude Loss of or Damage to the following:-

a) Boilers

b) Economizers,

c) Other Vessels,

d) Machinery or Apparatus or to their Contents, wherein Pressure is used, resulting from the Explosion.

But all General Exclusions of the Fire Insurance Policy, as well as Conditions thereof shall apply as if the same had been incorporated in this Endorsement. For this purpose, any Loss or Damage by Explosion, as mentioned afore, shall be deemed to be Loss or Damage as if caused by Fire within the meaning of the Fire Insurance Policy.

However, as far as General Exclusion No.9 of the relative Fire Insurance Policy is concerned, any Loss or Damage caused by an Explosion of Gas used for illuminating or domestic purposes in a premises/building, wherein Gas would not be generated or Gas-works are not being carried on, shall be deemed to be Loss or Damage by Fire within the meaning of the relative Fire Insurance Policy.

To simplify the said General Exclusion No.9, which has been mentioned in the Jacket of the Fire Insurance Policy, let me elaborate that if there would have been any Loss or Damage to the Subject-matter of Insurance with in an Insured Premises/Bldg., due to an Explosion of Gas used for illuminating or domestic purposes, wherein No Gas might have been generated or No Gasworks would have been carried-on within the same Premises/Building, then the Loss or Damage by Gas Explosion therein would be deemed covered within the purview of the relevant Fire Insurance Policy by virtue of the attachment to the Fire Policy of the Standard Explosion Endorsement under reference.

In case, however, if any Process of generating Gas and Gas-works would have been carried-out in the Premises/Building and an Explosion therein would have damaged the Subject-matter of Insurance within the same Premises/Bldg., then, despite the attachment of the Standard Explosion Endorsement to the Policy, any Loss or Damage or Expenses or Cost to the Subject-matter of Insurance would be deemed excluded from Coverage of the Fire Insurance Policy.

However, the following Special Conditions are applicable to the Standard Explosion Endorsement of a Fire Insurance Policy:-

(I) Loss or Damage or Cost or Expense, directly or indirectly caused by an Act of Terrorism, regardless of any Other Cause or Event which might have concurrently contributed to the same Act of Terrorism, shall fall out of the ambit of the relative Fire Insurance Policy, even if the Standard Explosion Endorsement would have been attached therewith.

Any Act of Terrorism has been defined as "the use of un-limited Force or Violence and/or Threat thereof. Besides, Terrorism would also include a Harmful Act to humanlife, or Tangible or Un-tangible property or Infrastructure by any Person or group of Persons, irrespective of whether working alone or on behalf of an Organization, for Political, Religious, Ideological or other alike purposes. Terrorism would also include an intention to influencing the government or putting public or any Section of the Public in fear.

It is also pertinent to mention that any Loss or Damage or Cost or Expenses, as a consequence of an action, which would have been taken, either directly or indirectly, in the course of controlling, preventing, suppressing the Acts of Terrorism, would also fall within the Exclusions of the Standard Explosion Endorsement.

Besides, any Loss or Damage, which would have happened during the existence of Abnormal Conditions in the course of the afore-mentioned Happenings, shall be deemed uncovered by the relevant Fire Insurance Policy. In case, however, if the Insureds shall be able to prove that the same Loss has taken place independently of the said Abnormal Conditions, then the same shall be considered covered within the scope of the relevant Fire Insurance Policy. In case of any Legal Suit or Action, when the Underwriters would have alleged that under the Provisions of Conditions of this Standard Explosion Endorsement, any Loss or Damage is not covered by the Insurance Policy, then the burden of proving that it is covered, would be the responsibility of the Insureds.

(II) In case, there shall be another Fire Insurance Policy/Policies on the same Subject-matter of Insurance, the Company shall be liable only to the Pro-Rata amount of the Loss with other alike Insurance Policies, in respect of any Loss or Damage by Explosion, irrespective of the fact whether or not those other Fire Insurance Policies would cover Loss or Damage by Standard Explosion Endorsement.

In case, at the time of the Occurrence of a Loss or Damage by Explosion, if the Subject-matter of Insurance would have been covered or ought to have been covered by any other existing Policy/Policies, but had not been so covered due to the existence of this Policy, any Loss or Damage due to Exclusion would fall out of the purview of this Fire Insurance Policy, despite the attachment of the Standard Explosion Endorsement thereon.

(III) However, this Policy would only indemnify the Insureds for the Excess amount of the Loss or Damage which would have been payable under those other Insurance Policy/Policies, had this Insurance not been effected.

To Be Continued......
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Publication:Insurance Journal (Karachi)
Date:Dec 31, 2017
Words:983
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