Bharat Sookshma Udyam Suraksha

What is Bharat Sookshma Udyam Suraksha?

Bharat Sookshma Udyam Suraksha is a standard fire and allied perils policy for micro enterprises whose total value at risk at a single location is up to ₹5 crore. It pays to repair or rebuild your premises and replace machinery, furniture and stock damaged by fire, natural catastrophes and the other perils listed in the wording.

It is one of the standard products IRDAI introduced from 1 April 2021 to replace the older fire policy for small risks. Because every general insurer issues the same wording, the practical differences lie in premium, add-ons, underwriting appetite for your trade and how well the insurer handles claims. It sits within our wider fire insurance range.

What the policy covers

The policy protects property at the address shown in the schedule against:

• Fire, lightning, explosion and implosion
• Storm, cyclone, typhoon, tempest, hurricane, tornado, flood and inundation
• Earthquake, volcanic eruption, subsidence, landslide and rockslide
• Riot, strike and malicious damage
• Aircraft damage, impact by vehicles or animals, and missile testing operations
• Bursting or overflowing of water tanks and pipes, and leakage from automatic sprinklers
• Bush fire and forest fire
• Theft that happens within a short period after, and because of, one of the insured events

The wording also pays certain costs that follow a loss, such as removing debris, professional fees for rebuilding and the cost of recreating business records, each subject to the limits in the policy. Terrorism damage is available as an optional add-on.

How the ₹5 crore test works

Add up the value of every asset class at one location: building, plant and machinery, furniture and fittings, and stock. If the total is ₹5 crore or less, the location qualifies. A business with several sites checks each one on its own. If any location crosses the threshold, it moves to Bharat Laghu Udyam Suraksha.

What is not covered

• Loss of profit or income while you are shut after a fire. This needs a separate fire loss of profit policy.
• Electrical or mechanical breakdown of machines, unless it leads to a fire that spreads.
• Burglary or ordinary theft that is not linked to an insured peril, unless you buy burglary cover.
• Wear and tear, gradual deterioration, rust, rot and pests.
• War, nuclear risks, pollution and deliberate acts by you.
• Cash, jewellery, documents and similar valuables, unless specifically declared and accepted.

Who needs it

It suits most small commercial occupancies: retail shops and showrooms, restaurants, clinics and diagnostic centres, offices, small workshops, traders' godowns and light manufacturing units. Banks and NBFCs that fund a business or its stock usually ask for this cover, with the lender noted as a loss payee. Tenants can insure their own fit-out, machinery and stock even where the landlord insures the building.

How the sum insured is decided

Getting values right matters more than chasing the lowest premium.

• Building: the cost of rebuilding today, based on built-up area and current construction rates. Leave out land value.
• Plant, machinery and furniture: the cost of replacing them with new items of similar kind and capacity.
• Stock: the cost value at the highest level you expect to carry during the year, including festive or seasonal peaks.

The wording sets out how an insurer treats a sum insured that falls short of true value, and it differs from the older fire policy. The simplest course is to insure full values so the question never arises. Premium depends on the occupancy, construction, fire protection, location and claims history.

How MILES helps

• We confirm whether each of your locations belongs under Sookshma, Laghu or a larger policy, so you are not issued the wrong product.
• We check your building and machinery values against reinstatement cost and flag gaps before renewal, not after a fire.
• We compare premiums and add-ons from our panel of 16+ insurers and explain which insurer has an appetite for your trade.
• We make sure lender clauses, addresses and stock descriptions are correct on the schedule.
• If there is a loss, we help you notify the insurer, prepare the claim file and deal with the surveyor. See our claims support.

What we need for a quote

• Business name, full address of each location and the nature of trade
• Construction of the building and the floors you occupy
• Values of building, plant and machinery, furniture and fittings, and peak stock
• Fire protection in place, such as extinguishers, hydrants or alarms
• Your current policy and three years of claims history, if any
• Details of any bank or financier to be noted on the policy

You can share these on WhatsApp or by email, or through our contact page, and we will come back with options.

Cover, exclusions and premiums depend on the insurer’s policy wording and underwriting. MILES Insurance Brokers Pvt. Ltd. is an IRDAI-licensed direct broker (Life & General, Reg. No. 954); the insurance is issued by the insurer. Insurance is the subject matter of solicitation.