Minggu, 09 Juni 2013

OUTPUT OPTION ENDORSEMENT

Subject to the terms and provisions of this Endorsement and all the terms, provisions, conditions, limitations and exclusions of the Policy of which this Endorsement forms a part which are not specifically modified by this Endorsement, it is declared and agreed that at the option of the Insured, the term "Output" may be substituted for the term "Turnover" in which case "Output" shall mean :
The sale value of goods manufactured by the Insured in the course of the Business at the Insured locations.

Where this option is taken Items l(a) and l(b) of the Specification to Section 2 of this Policy will read as follows :
(a)    In respect of Reduction in Output: The sum produced by applying the Rate of Gross Profit to the amount by which Output during the Period of Indemnity shall fall short of the Standard Output.

(b)    In respect of Increase in Cost of Working: The additional expenditure necessarily and reasonably incurred for the sole purpose of avoiding or diminishing the reduction in Output which, but for that expenditure, would have taken place during the Indemnity Period, but not exceeding the sum produced by applying the Rate of Gross Profit to the amount of the reduction thereby avoided.

All less any sum saved during the Indemnity Period in respect of such of the Insured Gross Profit as may cease or be reduced in consequence of the Damage.

Definitions
Standard Output   The Output during that period in the twelve months before the date of the Damage which corresponds with the Indemnity Period.

Rate of Gross Profit   The percentage that the Insured Gross Profit bears to the Output.
In determining the indemnity payable, the amounts of Rate of Gross Profit and Standard Output, as defined, shall be based upon the estimated production programme of the Business, and costs and prices relating thereto and subject to such adjustments 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 the Damage, or which would have affected the Business had the Damage not occurred, so that the figure 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.

It is understood and agreed that in the event of loss under this Section of this Policy, the Insured shall notify the Insurers in writing within 30 days of resumption of normal business operations, of the option he elects, and the entire adjustment of that loss shall be carried out subject to the terms and conditions of the elected option as herein defined.
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