LOSS OF PROFITS ENDORSEMENT

 

Endorsement No.           attaching to and forming part of policy No.              

in the name of: M/s

 

It is hereby declared and agreed that, if any building or other  property or  any part thereof used  by the  insured  at the   premises described in the policy  for  the   purpose  of   his business be  destroyed  or damaged  by  ANY  peril insured  under this policy  during  the period of insurance and  the business carried out by the insured at the  premises  be in consequence thereof interrupted or interfered with,  then  the  Company   will, to the  extent  and  in  the  manner  hereinafter  provided, indemnify the  insured  in  respect of  the  loss  of gross profit due to :  (a)  reduction in turnover   (b) increase  in cost of working  as  follows :-

 

The  amount  payable as indemnity thereunder shall be  :-

 

(a)         IN RESPECT OF REDUCTION IN TURNOVER : the sum produced by applying the rate of  gross  profit  to the amount  by which the turnover during the indemnity  period  shall, in consequence of the damage,  fall short of the standard turnover.

 

(b)         IN RESPECT OF INCREASE IN COST OF WORKING :the additional expenditure (subject to the  provisions of memo  3)  necessarily and  reasonably incurred  for  the  sole  purpose of avoiding or diminishing the reduction in turnover which but for that expenditure would  have taken  place  during the indemnity period in consequence of the damage,  but not exceeding the sum produced  by applying the  rate  of gross profit to the amount of the reduction thereby  avoided;

 

less any sum saved during  the  indemnity  period  in respect of such of the insured  standing  charges as  may cease or be reduced in consequence of the damage;

 

PROVIDED ALWAYS THAT  :

 

MEMO 1 : If the Sum Insured by this endorsement shall be less than the sum produced by applying the rate of gross profit to the annual turnover, the amount payable hereunder shall be proportionately reduced.

 

MEMO 2 : If during the indemnity period goods shall be sold or services shall be rendered elsewhere than at the premises for the benefit of the business, either by the insured or by others on the insured’s behalf, the money paid or payable in respect of such sales or services shall be brought into account in arriving at the turnover during the indemnity period.

 

MEMO 3  : If any standing charges of the business be not insured by this endorsement then, in computing the amount recoverable hereunder as increase in cost of working,that proportion only of the additional expenditure shall be  brought into account which the sum of net profit and the insured standing charges bears  to  the  sum of the net profit and  all the  standing charges.

 

MEMO 4 : The total liability of the company shall not exceed in the aggregate in  respect of all losses  during the currency of this policy  the sum insured hereby.

 

DEFINITION

 

GROSS PROFIT : The Sum Insured produced  by adding to the  net profit the amount of the insured standing charges, or if there be no net profit the amount of the  Insured  Standing  Charges less such a  proportion of any net trading loss as the amount of the Insured Standing Charges bears to all Standing Charges   of the Business.

 

NET PROFIT : The net trading profit (exclusive of all capital receipts and accretions and all out-lay properly chargeable    to capital) resulting from the business of the insured at   the premises after due provisions has been made for all   standing and other charges including depreciation, but before    the deduction of any taxation chargeable on  profits.

 

INSURED STANDING CHARGES : As specified  in  the schedule.

 

TURNOVER : The money paid or payable to the insured for goods sold and delivered and for services rendered in course of the business at the premises.

 

SHORTAGE IN TURNOVER : The amount by which  the turnover during the damage fall short of the part of standard     turnover which relates to that period.

 

INDEMNITY PERIOD : The period beginning after seven days of the occurrence of the damage and ending not later than the last day of the period as specified  in the attached schedule under   the title of indemnity period during which the results of  the business shall be affected in consequence of the damage.

 

Rate of Gross Profit :

The rate of gross profit earned on the turnover during

The financial year immediately before the date of the damage.

Annual Turnover :

The turnover During the 12 months immediately before the date of the damage.

Standard turnover :

the turnover during that period in the twelve months immediately before the date of the damage which corresponds with the indemnity  period.

To which such adjustments shall be made as may be necessary to provide for the trend of the business and for variations in or special circumstances affecting the business either before or after damage or which would have affected the business had the damage not occurred, so that the figures thus adjusted shall represent as nearly as may be reasonably practicable the results which but for the damage would have been obtained during the relative period after the damage.

CONDITIONS

1)               The insured shall use due diligence and concur in doing all things reasonably practicable to minimize any interruption or    interference with the business and to avoid or diminish the loss, whether by taking    other premises or by any other means.

2)               The Company will not be liable for any loss under this endorsement unless at the time of the happening of the damage there shall be inforce an insurance covering the interest of the insured in the property at the premises against such damage and payment shall have been made or liability admitted therefore under such insurance.

3)   If at the time  of any  loss  there  shall be any other subsisting insurance covering such loss, or any part thereof, the Company shall not be liable to pay more than their rateable proportion of the loss.

 

4)     Notwithstanding anything to the contrary contained herein, this endorsement does not cover loss resulting from damage to the premises or property therein   directly or indirectly occasioned by, happening through or in consequence of war, invasion, acts of foreign enemies, hostilities (whether war be declared or not) civil war, rebellion, revolution, insurrection,  military or usurped power, riots or civil commotion or confiscation or nationalization or requisition or damage  to property  by or under the order of any government or public or local authority.

 

5)               If the insured shall make any claim knowing the same to  be false or fraudulent, as regards amount or otherwise, this endorsement shall become void and all claim hereunder shall be forfeited.

6)               This cover shall be avoided if   :-

(a) The business be wound up or carried on by a liquidator or receiver or permanently discontinued or 

(b) The insured’s interest cease otherwise  than  by   death or

(c) Any alteration be made either in the business or   in the premises or property therein whereby the risk of damage is increased.

7)               The insured shall at his own expense produce and   furnish to the company books of account and other  business books, vouchers, invoices, balance  sheets  and other documents, proofs, information, explanation an other evidence as may reasonably be required by the company for the purpose of investigating or verifying   any claim hereunder.

PROVIDED ALWAYS THAT ALL THE TERMS AND CONDITIONS OF THE POLICY EXCEPT IN SO FAR AS THEY MAY BE HEREBY VARIED, SHALL APPLY AS IF HAD BEEN INCORPORATED HEREIN.

 

SCHEDULE

PERIOD OF INSURANCE
FROM :

INDEMNITY PERIOD :

ANNUAL SUM INSURED
AS DETAILED HEREUNDER

THE PREMIUM      :  AS AGREED

 

NET TRADING PROFIT & standin g charges:

 

 FOR/JERUSALEM INSURANCE CO. LTD.,