CONTENTS - Central Public Works Department

244 SECTION 39
SECTION 39
INSURANCE
39.1 General
(1) The Government property, both movable and immovable, should not normally be insured. No
subordinate authority, therefore, shall undertake any liability or incur any expenditure in connection
with the insurance of such property without prior consent of the Ministry of Finance in the case of
immovable property, and the Director General (Works) in the case of movable property.
(2) In cases where it is decided to insure properties or goods under the direct or indirect control of the
Central Government, the procedure as laid down by the Ministry of Finance from time to time
should be followed.
(3) The Director General (Works) has full powers in the case of insurance of movable property. The
Chief Engineer is, however, empowered to incur expenditure on the insurance of materials and
equipment received on loan or as aid from Foreign Governments or International or other
Organisations, if according to the terms of the contract or agreement, insurance of such materials
or equipment is necessary. Materials purchased ex-factory should be necessarily insured.
39.2 Inland transit insurance
(1) In cases of consignment of stores in general, dispatch on F.O.R. station of dispatch basis, and in
the case of fragile stores in particular, where the suppliers do not accept DGS&D’s transit insurance
clause and the stores cannot be booked by the Railway under a clear Railway receipt at Railway
risk, and if the indentor/consignee wants the stores to be insured against loss or damage in transit,
the supplier should be asked to do so sufficiently in advance by a registered letter under advice to
the DGS&D, who will make necessary provision in the contract by means of an amendment, if the
acceptance of tender has already been issued.
(2) Payment of extra charges on account of such insurance will be made by the concerned Controller/
Deputy Controller of Accounts (Supply). If the indentor/consignee does not follow this procedure,
he will make himself liable to bear the entire loss on account of the losses/breakages in transit. On
the other hand, the suppliers will be responsible for the entire loss on account of losses/breakages
in transit, if any, if they fail to insure the stores, not withstanding the instructions received by them
in this regard. Whenever occasion arises for making provisions for the payment of insurance
charges in the relevant accepted tender, the DGS&D should stipulate for information of the suppliers
that claims for insurance charges should be shown as a separate item in their bills, duly supported
by the insurance receipts and submitted to the concerned Controller/Deputy Controller of Accounts
(Supply) for payment. In other cases, where the price quoted by the supplier includes the element
of cost of transit insurance, the DGS&D will place contracts containing necessary provision for
insurance of the stores during transit.
(3) In cases of FOR station of dispatch contracts, where the suppliers have not accepted the DGS&D’s
standard clause of transit insurance, the consignee will be responsible to :—
(i) Lodge claims for loss or damage to stores in transit with the carrier Railway and directly
pursue the claims with the carriers;
(ii) Inform the supplier, Controller/Deputy Controller of Accounts (Supply)/Insurance Company
about the loss or damage;
(iii) To report the cases of dispute to the Purchase Officer for either pursuing the matter with the
Railway/higher authority or for suggesting write off; and
(iv) Write off the amounts that could not be recovered either from the supplier or the carrier Railway
in accordance with the procedure laid down in the Departmental Regulations.