CHINA PACIFIC PROPERTY INSURANCE COMPANY LIMITED
PROPERTY ALL RISKS INSURANCE CLAUSES
GENERAL PROVISION
Article 1The Insurance Contract incorporates the Insurance Clauses, Proposal Form, Policy or Certificate, and Endorsements (if any). Any agreement related to the Insurance Contract shall be in written form.
PROPERTY INSURED
Article 2 The property insured shall include the following property contained in the premise(s) specified in the Policy:
2.1 property belonging to the Insured solely or jointly with others for which the Insured is responsible;
2.2 property under management, control, and/or in the custody of the Insured;
2.3 other property in which the Insured has an economic interest legally admitted.
Article 3The following property shall not be insured by this Policy, unless otherwise specifically agreed between the Insurer and the Insured and with insured value stated in this Policy:
3.1 gold, silver, pearls, diamonds, jades, jewelry, ancient coins, antiques, ancient books, ancient
paintings, stamps, works of art, works of painting and calligraphy, rare metals and the like;
3.2 embankments, water gates, railways, roads, culverts, tunnels, bridges, docks and piers;
3.3 plants, equipments and materials in mines or mineral pits;
3.4 mobile communication devices, portable computers, portable photographic apparatus, and other
portable devices or equipments;
3.5 construction or erection works not taken over or put into service.
Article 4 The following items and articles are not insured by this Policy:
4.1 land, mineral resources, water and other natural resources;
4.2 mines and mineral pits；
4.3 banknotes, coupons, securities, magnetic and integrate circuit (IC) cards with cash value and the
like;
4.4 Files and documents, account books, drawings, technical data, computer software or data, and
other properties of which the value could not be appraised;
4.5 guns, ammunitions or explosives;
4.6 illegal or dilapidated buildings and structures, properties illegally occupied;
4.7 vehicles licensed for general transport use;
4.8 animals, plants and agricultural crops.
SCOPE OF COVER
Article 5 Subject to the terms, exclusions, conditions and provisions contained in the Policy or endorsed thereon, the Insurer shall indemnify the Insured for direct physical loss of or damage to the property insured (physical loss or damage being hereinafter termed Damage) caused by any Natural H
azard or Accident which occurs during the period of insurance, other than those specifically excluded in this Policy.
The Insurer shall also indemnify the Insured for physical loss of or damage to the property insured resulting from necessary and reasonable measures taken at the time of the happening of perils insured against by this Policy for the purpose of preventing or diminishing imminent damage to property hereby insured and/or preventing the spread and/or aggravation of loss or damage. Article 6 Subject to the terms, conditions and exclusions contained herein or endorsed hereon, the Insurer shall also indemnify the Insured in respect of costs and expenses necessarily and reasonably incurred for the purpose of preventing or mitigating the loss of or damage to the property
insured after the occurrence of an insured event.
EXCLUSIONS
Article 7 The Insurer shall not indemnify the Insured in respect of any loss, damage, or expenses resulting from:
7.1 willful act or gross negligence of the Applicant or the Insured or his representative;
7.2 governmental or judicial actions;
7.3 war and warlike operation, hostilities, armed conflicts, strike, riot, civil commotion, coup
d’état, conspiracy insurrection, terrorism;
7.4 earthquake, tsunami and secondary disasters so caused;
7.5 nuclear radiation, nuclear fission, nuclear fusion, nuclear pollution or contamination and
other radioactive pollution or contamination;
7.6 pollution of atmosphere, soil, water and other non-radioactive pollution, except
non-radioactive pollution caused by perils hereby insured.
7.7 inherent vice or latent defect of the property insured, wear and tear of the property
insured, changes in atmosphere (climatic or temperature) conditions, changes in normal water level or any other progressively operating causes; changes in substance, mould, humidity, mice, insects or vermin, birds, oxidation, rust, leakage, baking;
7.8 theft, burglary or robbery.
Article 8 The Insurer shall not be liable for:
8.1 consequential loss of the property insured arising from an event insured;
8.2 loss of or damage to the property insured itself arising from faulty design, defective
material, or bad workmanship;
8.3 loss of or damage to the outside ancillary devices of building such as advertising signs,
antenna, neon lights, solar energy equipment and other property insured stored in the open or in the simple building and the loss of or damage to the simple building itself, caused by the lightning, rainstorm, flood, inundation, windstorm, tornado, hailstone, typhoon, hurricane, snowstorm, icicle, sandstorm;
8.4 loss of or damage to the boilers or other pressure vessels themselves caused by their
own explosion;
8.5 loss of or damage to the mechanical or electrical devices themselves unless due to
external forces;
8.6 loss of or damage to electrical or mechanical equipment caused by faulty operation or
lack of skills of the Insured or any of his employee(s);
8.7 shortage discovered at the time of taking an inventory;
8.8 any loss or expenses caused by failure of public utilities, such as electricity, gas, water
supply or other energy sources, due to any causes;
8.9 the deductible(s) stated in the Policy.
INSURED VALUE, SUM INSURED, AND DEDUCTIBLE
Article 9 The insured value of the property insured, which can be either the reinstatement value, the book value, the market value or other values at the time of the happening of Damage, shall be agreed upon between the Applicant and the Insurer and stated in the Policy.
Article 10 The sum insured, which shall be determined by the Applicant according to the insured value and stated in the Policy, shall not exceed the insured value. The part of sum insure in excess of the insured value is deemed to be invalid, and correspondingly the premium of such part in excess shall be returned to the Applicant.
Article 11 The deductible shall be agreed between the Applicant and the Insurer when entering into the insurance contract and specified in the Policy.
PERIOD OF INSURANCE
Article 12 Unless otherwise agreed, the period of insurance shall be one year subject to the inception and expiration date as stipulated in the Policy.
OBLIGATIONS OF THE INSURER
Article 13 In case of application of standard clauses, the Insurer shall enclose them in the Proposal Form and explain the contents of the insurance contract to the Applicant. For the clauses exempting the Insurer’s liability, the Insurer shall make remarkable notice in the Proposal Form, Policy or other certificates to draw the Applicant’s attention, and explain them clearly in written or oral form when entering into the contract. Otherwise, such clauses shall be void.
Article 14 The Insurer shall issue the Policy or other certificates in a timely manner after the establishment of an insurance contract
Article 15 The Insurer’s right to cancel the Policy as stated in Article 19 is void if not exercised by the Insurer within thirty days after his acknowledgement of any causes for cancellation of this Policy. After two years from the establishment of the insurance contract, such right to cancel the Policy is also void and the Insurer shall be liable for Damage insured by this Policy.
If before the establishment of the insurance contract, the Insurer is aware of the Applicant’s misrepresentation or non-disclosure, the Insurer cannot cancel the Policy, and still shall be liable for Damage insured by this Policy.
Article 16 If the Insurer believes that the proofs and documents provided by the Insured, as required in Article 25, are not sufficient, the Insurer shall request the Applicant and/or the Insured to provide additional materials in time and once for all.
Article 17 Upon receipt of a claim, the Insurer shall confirm whether the Damage is covered by this Policy or not in a timely manner. For complicated cases, the Insurer shall make decision within thirty days, unless otherwise stipulated in the insurance contact.
deductibleThe Insurer shall notify the Insured of the decision in a timely manner. If the Damage is covered by this Policy, the Insurer shall make payment within ten days after reaching an agreement with the Insured. If the time limit for indemnity is specifically stipulated in the insurance contact, the Insurer shall make payment within such time limit. If the Damage is not covered by this Policy, within three days after the decision, the Insurer shall issue a declination letter and explain the reasons to the Insured.
Article 18 The Insurer shall allow an advance payment that can be determined by the available proofs or documents if the final settlement amount cannot be determined within sixty days after receipt of such claim and relevant documents, and pay the balance to the Insured after the final amount of indemnity is adjusted.
OBLIGATIONS OF THE APPLICANT AND/OR INSURED
Article 19Before entering into an insurance contract, the Applicant shall make full and accurate representation and disclosure at the request and/or inquiry of the Insurer in respect of the property insured and the Insured himself and complete the Proposal Form faithfully.
If the Applicant fails to fulfill the obligation of making full and accurate representation and disclosure as aforementioned due to his willful act and/or gross negligence, which may affect the Insurer’s decision
whether to write the risk of the insurance and, if so, whether to raise the premium rate, the Insurer is entitled to cancel the Policy.
If the Applicant willfully fails to comply with the obligation of making full and accurate representation and disclosure, the Insurer shall not be liable for any loss or damage happening prior to the cancellation of the Policy while no premium shall be refunded.
If the Applicant, due to gross negligence, fails to disclose in truth material particular(s) which has significant contribution to the occurrence of the event insured hereby, the Insurer shall not indemnify the Insured for any loss or damage happening prior to the cancellation of this Policy, but shall return premium collected.
Article 20 The Applicant shall pay premium as agreed upon in the insurance contract.
If the premium is agreed to be paid in a lump, the Applicant shall pay the premium on or before the agreed due date. Otherwise, the Insurer shall not be liable for any loss or damage which occurs prior to premium payment.
If the premium is agreed to be paid in installments, the Insurer shall undertake liability in proportion of the paid premium to the total premium payable before the occurrence of
Damage. The total premium payable refers to the total premium that the Applicant shall pay as agreed prior to the occurrence.
Article 21 The insured shall observe and fulfill relevant laws, regulations and requirements on fire, safety, production operations and labor protection, improve management, take all reasonable precautions to protect the security of the property and prevent and/or minimize Damage thereto. The Insurer is entitled to inspect whether or not the Insured has fulfilled the aforementioned obligation of reasonable precautions, and make recommendations in writing to the Applicant or the Insured on eliminating risks and dangers, which shall be implemented by the Applicant and/or the Insured in a serious manner accordingly.
If the Applicant or the Insured fails to comply with due obligation of reasonable precautions, the Insurer is entitled to charge additional premium or cancel the Policy.
Article 22 Once any property insured is transferred, the Insured or the Assignee shall notify the Insurer in time.
If the risk increases materially due to that transfer, the Insurer may charge additional premium or cancel the Policy subject to the terms and conditions of the Policy within thirty days after the Insurer’s r
eceipt of such notice, in which case, the Insurer shall retain the premium due for the period from the date of inception to the date of cancellation, and refund the remainder of the charged premium to the Applicant
If the Insured or Assignee fails to comply with the aforementioned obligation of notification, the Insurer shall not be liable for any Damage due to the material increase of risks resulted from such transfer of the property insured.
Article 23 During the period of insurance, the Insured shall give the Insurer timely written notice of any alteration of the occupation and/or usage and/or location of the property insured and/or other material facts which may increase the risks materially and affect the Insurer’s decision whether to continue writing the risk of insurance and, if so, whether to increase the premium, and the Insurer is entitled to charge additional premium or cancel the Policy.
If the Insured fails to comply with the obligation of notification aforementioned, the Insurer shall not be liable for any Damage due to the material change of the risks.
Article 24 If any event giving rise to or likely to give rise to a claim under this Policy comes to his knowledge, the Insured shall:
24.1 take all necessary and reasonable measures to prevent or minimize the Damage; otherwise the
Insurer shall not be liable for any extended or aggravated loss or damage caused hereby;
24.2 give notice to the Insurer immediately and submit a written report on the cause, course and extent of the loss or damage. If the Applicant and/or Insured fail to notify the Insurer in time due to his willful act or gross negligence, which makes the Insurer not able to ascertain the nature, cause and extent of the loss, the Insurer shall not indemnify the Insured in respect of such uncertain part of Damage, except that the Insurer is aware or ought to be aware of the occurrence timely by other means.
24.3 preserve the spot, permit and assist the Insurer in investigation of the Damage. If the cause of the occurrence cannot be ascertained or the severity of the damage cannot be verified due to the refusal of or disturbance by the Insured, the Insurer shall not be liable for such uncertain part of Damage.
Article 25 To lodge a claim, the Insured shall submit the following proofs and documents:
25.1 the original policy, claims application, list of lost or damaged property, certificates of technical
appraisal, report on the occurrence, invoices of rescue expenses, necessary accounting books, documents and certificates issued by relevant governmental departments or public authorities.
25.2 all other information and available documents or proofs concerning the verification of the nature,
cause and extent of the Damage that can be provided by the Applicant or Insured.
If the Applicant or Insured fails to comply with their obligation of providing the proofs and documents as aforementioned, which makes the Insurer not able to verify the Damage, the Insurer shall not indemnify the Insured in respect of the uncertain part of Damage.
LOSS SETTLEMENT
Article 26 The Insured cannot lodge any claim against the Insurer if he has no insurable interest in the property insured at the time of the occurrence hereby insured.
Article 27 The Insurer may, at his option, indemnify the Insured for loss of or damage to the property insured by either:
27.1 cash: the Insurer makes cash payment as indemnity; or
27.2 replacement: the Insurer replaces the lost or damaged property with that of the same type,
structure, function and capacity as the nearest condition of the property immediately prior to Loss; or
27.3 repair: the Insurer repairs the damaged property.
Nevertheless the extra costs and/or expenses of any alterations, additions or improvements occurring in the course of repair or replacement carried out by the Insured shall not be recoverable under this Policy.
Article 28 The property insured still carrying salvage value after Damage shall be disposed upon agreement between the Insured and the Insurer. If the salvage of the damaged property is retained by the Insured, the salvage value shall be deducted from the actual amount of indemnity
Article 29 For the loss of or damage to the insured property recoverable under this Policy, the amount of indemnity shall be ascertained on the following basis:
29.1. If the sum insured is equivalent to or greater than the insured value, the payment shall be the
actual loss sustained but in no case shall the maximum liability of the Insurer exceed the insured value.
29.2. If the sum insured is less than the insured value, the amount of indemnity shall be such a
proportion of the actual loss as the sum insured bears to the insured value, but in no case shall the maximum liability of the Insurer exceed the sum insured.
29.3. Every item, if more than one, of this Policy shall be adjusted separately subject to the condition
herein.
Article 30 If the sum insured is equivalent to or greater than the insured value, the Insurer shall pay the Insured in respect of the necessary and reasonable costs and/or expenses incurred for the purpose of preventing or diminishing imminent damage to property insured caused by peril insured against by this Policy, in which case, the amount of such sue and labor expenses shall be calculated separately from the amount of indemnity for the damage of the property insured, subject to the limit of the insured value of the rescued property insured.
If the sum insured is less than the insured value, the payment of the aforementioned sue and labor expenses shall be such proportion of the actual expenses as the sum insured of the rescued property insured bears to its insured value, and calculated separately from the amount of indemnity for the Damage of the property insured, subject to the limit of the sum insured of the rescued property insured.
In the case that uninsured items are included in the rescued property, the Insurer shall only pay for the proportion of the sue and labor expenses as the insured value of the rescued property insured bears to the total value of the rescued property.
Article 31 The amount of indemnity shall be the amount as reached in Article 29 and 30 deducting the deductible for any one accident/occurrence.
Article 32 If at the time of any loss or damage happening to any property hereby insured, there be any double insurance subsisting, the Insurer shall not pay or contribute more than his rateable proportion of loss or damage as the corresponding sum insured under this Policy bears to the corresponding total sum insured under all these policies.
The Insurer shall not advance the amount payable by other insurer(s). If the Insurer has paid more than his share due to the Insured’s non-disclosure, the Insurer is entitled to claim for the portion paid in excess.
Article 33 In the event of a partial loss, upon settlement of the claim by the Insurer, the sum insured of this Policy shall be reduced correspondingly from the date of Damage, and no premium shall be refunded by the Insurer for so reduced. If reinstatement of the sum insured is required by the Applicant,
an additional premium for the reinstated amount shall be charged on pro rata daily basis from the date of requirement by the Applicant to the expiry date of this Policy.
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