What is an average clause in a fire insurance policy?
Whenever a sum Insured is declared to be subject to the special condition of average, then, if such sum insured shall be at the breaking out of any fire or at the commencement of any destruction of or damage to the property by any other peril hereby insured against, be less than 85 % of the value of the property ...
Why average clause is included in fire claims?
c) Average Policy: Many a times, the applicant prefers the insured amount to be less than the value of the property. In such cases, the insurance company imposes the average clause to penalise the insured for taking up a policy less than the value of the property.
What is average clause in insurance?
The Average Clause is a policy term that restricts the total payout based on the proportion of the value covered.
What is average clause example?
Average clauses appear in insurance policies of all types of asset. So, for example, you are insuring your house and you tell the insurer its value, which forms the sum insured under the policy. The premium is based on the declared value and will be lower than what it should be if the true value was given.
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Meaning Procedure and Principles of Fire Insurance - NAS College www nascollege org/e 20cotent 2010-4-20/ms 20deepika 20srivastav/Fire 20Insurance 20LL 20M 20IV 2024-4 pdf The policy is containing an 'average clause' called an Average Policy The amount of indemnity is determined concerning the value of the property insured If
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