Insurance Plans India 108 views August 7, 2021

Bharat Sookshma Udyam Suraksha helps individuals get insurance cover on their properties related to business. Under this plan, an insurer agrees to pay the losses the insured person may suffer due to physical loss, damage or destruction of the building, etc. caused by unexpected events.

On this page, we will talk about different aspects of the Bharat Sookshma Udyam Suraksha – cover options, sum insured, eligibility, etc. Let’s start without any further ado.

Let’s Understand the Insurance Cover of the Bharat Sookshma Udyam Suraksha Policy

As mentioned earlier, Bharat Sookshma Udyam Suraksha offers protection to your property (related to your business). Under the policy, you can get three types of covers mentioned below.

Standard Cover

Building & Structures, plant & machinery, stock and other assets related to your business will get covered.

In-built Covers

If an insurer provides coverage under the standard cover against the loss or damage to the insured person’s property, damages and expenses will also get covered.

  1. Additions, alterations, or extensions up to 15% of the sum insured for a particular item (excluding stocks)
  2. Stocks on a floater basis at more than one location
  3. Temporary removal of stocks up to 10% of the overall value
  4. Cover for money up to INR 50,000 during the policy period
  5. Cover for documents (deeds, manuscripts, business books, plans, drawings, securities, etc.) up to INR 50,000
  6. Cover for computer programs and information up to INR 5 lakh
  7. Personal effects of employees, directors, and visitors cover up to INR 15,000 per person up to 20 people during a policy term
  8. Start-up expenses cover up to INR 1 lakh
  9. Fees of architects, surveyors and consulting engineers covered up to 5% of the claim amount

Standard Add-on

You can also choose a standard add-on to cover the fluctuations in stock or stock values on a declaration basis. For this, you will need to pay an additional premium amount.

Note: Apart from the standard add-on, you can also buy additional covers for your plan. The coverage under add-ons may vary from one insurer to another.

How To Decide Sum Insured Under the Policy?

The sum insured under the policy may change from one insurer to another. To know the basis of the sum insured, check the below table.

Type of PropertyBasis of Sum Insured
For Building, Plant & Machinery, Furniture, Fixture & Fittings and other contentsReinstatement Value
For Raw MaterialLanded Cost at Your Premises
For Stock in ProcessInput Cost of the Stock at the Time of Damage
For Finished StockContract Price of Goods Sold but not Delivered

Note: The reinstatement value is the amount at which the property of the insured person can be replaced by a similar property without any deduction of depreciation.

What is the Policy Term?

The policy term can go up to one year.

What is the Premium Amount for Bharat Sookshma Udyam Suraksha Policy?

To enjoy the benefits, you will need to pay the premiums in advance as your coverage will start only after the premium payment. The premium amount depends on the following factors.

  1. Nature of the insured property (Building, plant, stock, etc.)
  2. Sum insured amount
  3. The nature of your business
  4. Various factors defining the risk profile of your enterprise

What Type of Property Can Get Coverage?

The policy can cover the following types of properties.

  1. Building with its basements (if any), fittings and fixtures, garage, towers, security sheds, internal roads, etc. and other structures located in the business premises
  2. Plant & Machinery, spares and accessories
  3. The stock of goods or merchandise including finished goods, semi-finished goods, stock in process & raw material, packing material, etc.
  4. Furniture, office and electronic equipment, canteen and kitchen equipment, computers, etc

Who Can Purchase the Bharat Sookshma Udyam Suraksha Policy?

To be eligible for the Bharat Sookshma Udyam Suraksha, you will need to meet the following conditions.

  1. You should be its owner, lessee, tenant, or purchaser.
  2. You hold the property as a trustee on commission or are responsible for the same.
  3. The value of all insurable assets at a particular location should not be more than INR 5 crore at the start of the policy.
  4. This plan is available for offices, hotels, shops, industrial/ manufacturing risks, utilities located outside the compound of industrial/ manufacturing risks, storage risks, etc.

Note: If the value of your insurable assets reaches more than INR 5 crore during the policy term, the Bharat Soomkshma Udyam Suraksha plan will expire.

What Will be Not Covered Under the Policy?

Bharat Sookshma Udyam Suraksha will not cover the following losses and events occuring during the policy term.

  1. A deliberate act causing loss or damage
  2. Loss, destruction, or damage to stocks in cold storage due to change in temperature,
  3. War, invasion, war-like operations, etc.
  4. Ionising radiation
  5. Pollution or contamination
  6. Property is missing or has been mislaid
  7. Consequential or indirect loss or damage
  8. Costs incurred on claim preparation
  9. Insured premises or building remains unoccupied (For more than 30 days)
  10. Any electrical/electronic machine, apparatus, fixture, or fitting by over-running, excessive pressure, short-circuiting, arcing, self-healing, etc.

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