REPLACEMENT VALUE CLAUSE
REPLACEMENT VALUE CLAUSE
It is understood and agreed that otherwise subject to the terms, exclusion, provision and conditions contained in the policy or endorsed thereon, where an insure items totally destroyed or damaged, the basis upon which the amount payable under the policy is to be calculated shall be the full replacement value of the item destroyed or damage.
“Replacement Value” shall mean the cost, which would have to be incurred immediately before destruction of or damage to an insured item for replacing the destroyed or damaged item by a new item of similar kind, capacity, size and quality.
REINSTATEMENT ADDITIONAL PREMIUM (COMPULSORY CLAUSE)
It is understood and agreed that in the event of loss or damage by any of the perils insured against to the property above described and in the absence of written notice by the company of the insured to the contrary the amount of insurance canceled by loss is to be automatically reinstated as from the date of loss.
The insured undertaking to pay such premium may be required from such reinstatement for the date of loss.
REINSTATEMENT VALUE CLAUSE
It is hereby agreed that in the event of the property insured under the within policy being destroyed or damaged, the basis upon which the amount payable under the policy is to be calculated, shall be the cost of replacing or reinstating on the same site, property of the same kind or type, but not superior to or more extensive than the insured property when new, subject to the following special provisions and subject also to the terms and conditions of the policy except insofar as the same may be varied hereby.
1. The work of replacement or reinstatement (which may be carried out upon another site and in any manner suitable to the requirements of the insured, subject to the liability of the company not being thereby increased) must be commenced and carried out with reasonable despatch and in any case must be completed within 12 months after the destruction or damage or within such further time as the company may (during the said 12 months) in writing allow: otherwise no payment beyond the amount which would have been payable under the policy, if this memorandum had not been incorporated therein, shall be made.
2. Until expenditure has been incurred by the insured in replacing or reinstating the property destroyed or damaged, the company shall not be liable for any payment in excess of the amount which would have been payable under the policy if this memorandum had not been incorporated therein.
3. if at the time of replacement or reinstatement the sum representing the cost which would have been incurred in replacement or reinstatement if the whole at the breaking out of any fire or at the commencement of any destruction of or damage to such property by any other peril insured against by this policy, then the insured shall be considered as being his own insurer for the excess and shall bear a rateable proportion of the loss accordingly. Each item of the policy (if more than one) to which this memorandum applies shall be separately subject to the foregoing provision.
4. no payment beyond the amount which would have been payable under the Policy if this memorandum had not been incorporated therein shall be made if at the time of any destruction or damage to any property insured hereunder such property shall be covered by any other insurance effected by or on behalf of the Insured which is not upon the identical basis of reinstatement set forth herein.
5. This memorandum shall be without force or effect if:
a) The insured fails to intimate to the company within 6 months from the date of destruction or damage or such further time as the company may in writing allow his intention to replace or reinstate the property destroyed or damaged.
b) The insured is unable or unwilling to replace or reinstate the property destroyed or damaged on the same or another site.
REINSTATEMENT OF SUM INSURED CLAUSE
The insurance by this policy shall not be reduced by the amount of loss unless specific advice is given by the Insurer to the contrary and the insured undertakes to pay the appropriate extra premium on the amount of the loss from the date thereof to the date of the expiry of the period of insurance.
About the Author
Write a Comment
Gravatars are small images that can show your personality. You can get your gravatar for free today!