1 2 3 4 5 7 8 A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
A. A/ A1 A2 A3 A4 A5 A6 A7 A8 A9 Aa Ab Ac Ad Ae Af Ag Ah Ai Aj Ak Al Am An Ao Ap Aq Ar As At Au Av Aw Ax
Add Ade Adf Adh Adj Adm Ado Adr Adu Adv

Advance Loss of Profit Insurance (ALOP)/Delay in Start-up Insurance (DSU) for Engineering Insurance

ALOP is also known as Delay in Startup and cover financial consequences of a project being delayed because of Occurrences related to natural perils inherent defects and human failures that lead to material damage of an accidental nature resulting into accidental damage to the project material during erection/testing stages and thereupon consequently loss of profit due to delay in startup of the Project. It basically follows the principle characteristics of an annual consequential loss policy but is issued in advance of the actual commencement of the business since it is a compulsion from the financers of the Project. For the insurers, the financial consequences at stake are those which relate to the period after the contractor would have handed over the plant to the owner/principal and commercial operations commenced. Thus, the principal alone and his financiers have an insurable interest in the financial consequences of a delay in the project and as such policy is issued to the principal/owner of the project with the interest of the financiers suitably recorded. Policy provides to indemnify the principal or the project owner for the actual financial loss sustained due to delay in commencement of the commercial operations of a new project which is under installation/construction. Delay must be caused by direct physical loss or damage admissible under material damage CAR/EAR policies covering the contract works. Sum Insured is computed on the basis of the financial model of the project. The period for ALOP coincides with the EAR/CAR policy period including the testing period, if covered, and terminates with the commencement of commercial operations. The period of indemnity commences on the COD i.e., the day on which the project would have been taken over by the owner had the accident not occurred, and ends on the day the commercial operation starts. The time excess or the waiting period is the period within the period of delay for which loss is borne by the insured.

Advance Premium

The payment made at the start or beginning of the period covered by the Insurance Policy.

***

Also called deposit premium, an advance premium is a down payment on what will be the final premium, in policies where the final premium is subject to audit.

 

 

Advance profits insurance

A form of business interruption insurance relating to a new business or a new activity for an existing business. It covers loss of gross profit following delay consequent upon damage insured under a contractor’s all risks or erection all risks policy. The delay in starting the activity may be due to damage to: (a) the new works, extension or machinery; (b) suppliers’ premises; (c) machinery in transit. The indemnity period commences on the date production was intended to start and continues until it does actually start, but any increase in cost of working is calculated from the date of loss.

Advance rent insurance

Cover for a property owner against loss of rental income due to an insured event delaying the letting of his property. The sum insured is the annual rent multiplied by the number of years representing the maximum delay period. A loss is measured by the rent that would have been paid by the tenant during the period of delay.

Advance underwriting

System that may be used for underwriting members of group schemes. Once a group member has been accepted at ordinary rates he becomes entitled to increases in cover up to a pre-arranged percentage without further evidence of health or underwriting scrutiny. Also called guaranteed insurability.