the insurer's MSME Package Policy bundles 14 sections — fire, agreed-value business interruption, burglary, money, machinery breakdown, electronic equipment (laptop all-risk), goods in transit, plate glass, baggage, fidelity guarantee, employee PA, cyber liability, employee liability, and public liability — into one comprehensive commercial package. No average clause. BI calculated at your per-day Agreed Gross Profit.
the insurer Miscellaneous· 14 Sections· Micro + Small + Medium Enterprises· No Average Clause
the insurer's MSME Package Policy is a comprehensive 14-section commercial insurance package built specifically for India's Micro, Small and Medium Enterprises. It combines fire protection, an innovative agreed-value business interruption cover, burglary, money, machinery, electronic equipment, goods in transit, cyber liability, and more — with two transformative features: NO average clause, and a simplified per-day BI formula.
| Category | Investment in Plant & Machinery | Annual Turnover | Policy Base |
|---|---|---|---|
| MICRO | Up to ₹1 Crore | Up to ₹5 Crore | Bharat Sookshma Udyam Suraksha (≤₹5Cr value at risk) |
| SMALL | Up to ₹10 Crore | Up to ₹50 Crore | Bharat Laghu Udyam Suraksha (₹5Cr–₹50Cr value at risk) |
| MEDIUM | Up to ₹50 Crore | Up to ₹250 Crore | Bharat Laghu Udyam Suraksha (₹5Cr–₹50Cr value at risk) |
Classification per MSME Ministry data. Both manufacturing and service enterprises are eligible. Udyam Registration recommended.
Fixed sum insured. Indemnification limited to declared SI. No proportional reduction even if underinsured. The most business-friendly commercial policy feature in the series.
RevolutionaryBusiness interruption calculated as: Days closed × Per Day Agreed Gross Profit. Agreed at inception from audited accounts. No complex revenue audits at claim time.
Section IIFirst cyber coverage in this product series. E-Theft, E-Threat (ransomware), E-Vandalism, E-Business Interruption, data breach liability — all in one section.
Section XII· First in SeriesAll-risk cover for raw materials, WIP, and finished goods — inward from suppliers and outward to customers. First GIT coverage in the product series.
Section VII· First in SeriesLaptops get all-risk cover (theft, loss, fire, flood) — broader than standard electronic equipment's "unforeseen sudden accident." Most comprehensive device cover in the series.
Section VIFrom fire to cyber to public liability — the most comprehensive package product in the entire the insurer product series. One policy. Every business risk covered.
Most ComprehensiveAll 14 Sections — Click Any to See Full Details
Customer has the wide option to choose sections as per requirement. Section I (Fire) is the anchor section; Section II (BI) requires Section I. Sections III–XIV are independently selectable. The more sections chosen, the more comprehensive the protection.
The Most Commercially Significant Feature in This Series
Every standard commercial fire policy in India applies the average clause — if you are underinsured, your claim is reduced proportionately. The MSME Package Policy removes this entirely. Use the calculator below to see the financial difference.
Formula: If SI < Actual Value, Claim Payment = Claim Amount × (SI ÷ Actual Value)
Example: SI = ₹80 Lakh. Actual value = ₹1 Crore. Fire loss = ₹50 Lakh.
Standard policy pays: ₹50L × (80/100) = ₹40 Lakh — ₹10 Lakh out of your pocket.
This happens to thousands of MSMEs every year because stock values fluctuate and businessowners don't update SI regularly. A 20% underinsurance costs 20% of every claim.
Formula: Claim Payment = Claim Amount (up to SI). No proportional reduction.
Same example: SI = ₹80 Lakh. Actual value = ₹1 Crore. Fire loss = ₹50 Lakh.
MSME Package pays: ₹50 Lakh — full amount up to SI.
"The condition of Average will not be applied — a great relief for customers."
⚠️ Standard policy calculation: if SI ≥ 85% of actual value, no average (standard IRDAI Bharat Udyam threshold). If SI < 85% of actual value, proportionate reduction = Claim × (SI ÷ Actual Value). MSME Package Policy: full claim up to SI regardless of underinsurance ratio.
Section II — Agreed-Value Per-Day Formula· Max 12 Months· No Average Clause
Business interruption is the most underused cover in commercial insurance — less than 1% of fire policies have BI cover because standard BI is too complex. The MSME Package Policy solves this with a simple per-day formula agreed at inception from your last audited financial year accounts.
Business Interruption (Section II) only triggers if a Section I (Fire & Allied Perils) insured event causes the business closure. A flood destroys your factory → Section I pays for physical damage AND Section II pays for days you couldn't produce. A power cut or supplier strike does NOT trigger Section II — only Section I perils do.
Section XII — First Cyber Cover in the Entire the insurer Product Series
Section XII is the most contemporary section in this policy — and the only cyber liability cover in any the insurer product in this series. It covers both first-party losses (money stolen from your business digitally) and third-party liabilities (your customers' data breached from your systems). As MSMEs increasingly process digital payments and customer data, cyber risk is now as real as fire risk.
Covers loss from fraudulent input of data into a computer system causing unauthorised fund transfer. The most common cyber financial crime for MSMEs.
Covers loss where a customer transferred funds based on fraudulent communication for which your business is held legally liable.
Covers extortion loss including the cost of a professional negotiator. Responds when cyber criminals threaten to destroy, corrupt, or release your data.
Covers intentional destruction of computer systems or data — including when perpetrated by an employee. Internal threat is explicitly covered.
Covers business income loss during the period your systems are unavailable due to a covered cyber event. Includes extra expenses to restore operations.
Covers legal liability from customer claims due to system security failures resulting in unauthorized access to private information.
Covers claims alleging disparagement of products/services, libel, slander, defamation, and invasion of privacy arising from your digital presence.
Covers claims arising from security failures in your systems that result in harm to third-party systems — your infrastructure used as an attack vector.
Covers legal defence costs when a government agency, licensing body, or regulatory organization brings proceedings relating to a covered cyber event.
Section VII — First GIT Coverage in This Product Series
Section VII provides all-risk cover for raw materials, work-in-progress, and finished goods during transit — both inward (from suppliers) and outward (to customers). The first Goods in Transit coverage in any product in this series.
From supplier to your factory
To/from job workers & subcontractors
From your factory to customers
Section VI — Three Distinct Coverages· Laptop All-Risk Is Unique
Section VI has three distinct coverages — standard electronic equipment (unforeseen sudden accident), external data media with data restoration, and laptops on an all-risk basis. The laptop all-risk coverage is broader than standard electronic equipment cover.
Who Can Buy — Micro, Small, Medium· Manufacturing + Services· Udyam Registered
The MSME Package Policy covers all three categories — Micro, Small and Medium — across both manufacturing and service sectors. Udyam Registration is recommended. The base Section I policy depends on the total value at risk at one location.
"A report by the National Institute for Micro, Small and Medium Enterprise (NI-MSME) reveals that less than 10% of these enterprises have adequate insurance coverage, leaving them vulnerable to various risks."
Main reasons: lack of awareness, perceived cost, complex products, and lack of trust. The MSME Package Policy addresses all three: it's a single policy (simplified), the no-average-clause means full claims are paid (trust), and the agreed-value BI means premiums reflect actual risk accurately. Call Probitas on 022 4302 0000 — we will advise on the right section combination for your specific enterprise and location.
What the Policy Does NOT Cover
Exclusions confirmed from the article, the insurer Bharat Laghu/Sookshma Udyam Suraksha policy pages, and Bajaj General Insurance MSME insurance educational content.
War, invasion, civil war, nuclear contamination, radioactive material — excluded across all 14 sections. Standard across all the insurer products.
"Loss or damage to electrical/electronic machine by over-running, excessive pressure, short-circuiting, arcing, self-heating" — the machine that directly fails is excluded from Section I fire cover. Other property damaged by the resulting fire IS covered.
"Loss or damage to stocks in cold storage premises caused by change of temperature" — excluded from fire section. Not an insured peril under Section I.
Business Interruption (Section II) only responds to closures caused by Section I perils. Power cuts, labour strikes, supply chain failure, government orders — these do NOT trigger Section II.
Burglary claims require evidence of forcible entry or violence. Inventory shortages discovered at stock-taking without evidence of break-in are excluded.
Machinery breakdown covers sudden accidental failure — not gradual deterioration, wear and tear, corrosion, or age-related decline. Regular maintenance and overhaul costs are not covered.
Electronic equipment with known faults at inception of insurance — excluded. Equipment must be in working condition at policy start. Document equipment condition at inception.
Electronic equipment sent for repairs to unauthorised service centres (not OEM or reputed repairers) before surveyor assessment — claim for consequential damage may be rejected.
Loss due to inherent quality of the goods (perishability, self-heating, spontaneous combustion), delay in transit, insufficient packing, and leakage/wastage/evaporation — all excluded from Goods in Transit.
Fidelity Guarantee covers only full-time salaried employees on permanent payroll. Commission agents, freelancers, contractors, and part-time staff are excluded.
Bodily injury/property damage (covered under Sections XIII/XIV), deliberate criminal acts by the insured, failure to maintain reasonable security standards, and losses from pre-existing known vulnerabilities at inception.
Deliberate, wilful, or intentional acts by the insured or with the insured's connivance — excluded across all sections. Insurance covers accidental and unforeseen losses only.
What to Do When Something Goes Wrong
Different sections have different first steps. Fire (Section I) requires fire brigade report. Burglary (Section III) requires FIR. Cyber (Section XII) requires incident report. All claims: notify the insurer first, stop the loss, document everything before touching.
Fire: call fire brigade. Burglary: call police, lodge FIR. Cyber incident: isolate affected systems immediately, do not pay ransom without notifying the insurer. Machinery breakdown: shut down the machine to prevent further damage.
Call 022 4302 0000 on the same day. Every section requires prompt notification. For Cyber (Sec XII): notify within 24 hours of discovery. For BI (Sec II): notify while Section I event is still ongoing.
Photograph all damage. For fire: preserve debris for surveyor. For burglary: preserve entry/exit point evidence. For cyber: preserve system logs, attack evidence, communications. Do NOT repair before surveyor visit.
Complete section-specific claim form. Attach: FIR/fire brigade report (if applicable), photographs, asset inventory, purchase invoices. For Sec II BI: keep records of all production-related activities during closure period.
the insurer appoints a surveyor for fire, burglary, machinery, and GIT claims. For cyber: a cyber forensics expert may be appointed. For BI: auditor's certified accounts required. Cooperate fully and provide all records.
No average clause — full claim paid up to SI. For BI: Per Day AGP × Days of interruption. For cyber: specific cyber forensics assessment. Settlement typically within 30–60 working days of complete documentation.
MSME Insurance Questions
Get Your MSME Package Policy Quote
Our the insurer-empanelled commercial insurance specialists will contact you within one working day with a complete MSME Package Policy quote — with section selection advice, Agreed-Value BI calculation, and premium optimisation for your enterprise.
By submitting you agree to our Privacy Policy and Terms & Conditions. MSME Package Policy subject to the insurer underwriting. No average clause applies. BI SI = Agreed Gross Profit. Probitas Insurance Brokers Pvt. Ltd.· IRDAI Lic. No. 528.