Updated: Monday April 18, 2016/AlEthnien
Rajab 11, 1437/Somavara
Chaitra 29, 1938, at 07:36:05 PM
1The War Risks Insurance Ordinance, 1971
ORDINANCE NO. XXXII of 1971
[5th December, 1971]
An Ordinance to provide for the insurance of certain goods
and property in
WHEREAS it is expedient to provide for the
insurance of certain goods and property in
NOW, THEREFORE, in pursuance of the
proclamation of the 25th day of March, 1969, read with the Provisional
Constitution Order, and in exercise of all powers enabling him in that behalf,
the President is pleased to make and promulgate the following Ordinance:---
1. Short title, extent and commencement.-
(1) This Ordinance may be called the War
Risks Insurance Ordinance, 1971.
(2) It extends to the whole of
(3) It shall come into force at once 2[and
shall be deemed to have taken effect on the third day of December, 1971].
2. Definition. In this Ordinance, unless there is anything repugnant in
the subject or context,---
(a) “building”
includes foundations, boundary walls, plinths, garages, floors, staircases,
tanks, engine and boiler beds, chimneys and flues, but does not include a
factory building, or undertakings referred to in section 16;
(b) ”company”
means a company within the meaning of the Companies Act, 1913 (VII of 1913),
and includes a co-operative society registered under any law for the time being
in” force relating to the registration of co-operative societies and a
corporation established by or under any law for the time being in force which
has a share capital of which a part is held by the members of the public;
(c) ”factory”
means any premises including the precincts thereof where-on twenty or more
workers are working, or were working on any day of the preceding twelve months,
and in any part of which a manufacturing process is being carried on, with the
aid of power, or is ordinarily so carried on, but does not include a mine subject
to the operation of the Mines Act, 1923;
(d) ”factory
buildings” includes all buildings comprised in the factory and such other
buildings including residential buildings for staff and workmen, hospitals and
welfare centres within a radius of two miles from the main factory building as
are in the same ownership or occupation as the factory and are used for the
purpose of the factory;
1Validated by the Validation of Laws Act, 1975 (63 of
1975), s. 2 and Sch.,
2Added and shall be deemed always to have been so adde*d
by the War Risks Insurance (Amdt.) Act, 1972 (12 of 1972), s. 2 (w.e.f.
3-12-71).
(e) ”Fund” means
a War Risks Insurance Fund established under section 15;
(f) ”goods” means
any materials, commodities or articles which are insured against fire with any
insurer registered in
(g) ”goods in
transit” means such goods as are being imported into Pakistan or are shipped or
otherwise despatched from one Province to another or are in transit in the same
Province by railways, inland steamer, barge or a goods vehicles;
(h) ”goods or
property insurable under this Ordinance”---
(i) in relation
to any goods, means goods which are for the time being insured against fire
with an insurer registered in Pakistan and includes,---
(a) any spares
and stores and other consumable material kept in the premises of a factory for
the upkeep, maintenance and running of the factory provided such material are
insured against fire with an insurer registered in Pakistan;
(b) any
materials, commodities or articles lying within the precincts of a port or on
barges or on ships and are intended either for export or for movement outside
the port area in Pakistan for final disposal and are insured against fire with
an insurer registered in Pakistan;
(ii) in relation
to any goods in transit, means all goods which are imported into Pakistan or
shipped or otherwise despatched from one Province to another or are in transit
in the same Province by railways, inland steamer, barge or a goods vehicle, but
does not include goods which are in transit by a ship that sailed from a port
of shipment before the coming into force of this Ordinance:---
Provided that no insurance cover shall be extended to goods
carried in goods vehicles, barges and inland steamers unless a notification in
this behalf is issued by the 1[Federal
Government];
(iii) in relation
to any factory, means the factory, building and, except where they are goods
insurable under this Ordinance, all plant and machinery in the factory and such
other plant and machinery as may be prescribed;
(iv) in relation
to any building, includes plinths, floors, staircases, tanks or any immovable
construction which forms part of the building;
2* * * * * * *
(i) ”goods
vehicle” means any motor vehicle constructed or adapted for use for the
carriage of goods or any motor vehicle not so constructed or adapted when used
for the carriage of goods solely or in addition to passengers;
(j) ”insurable
value” in relation to any goods or property means the value of the goods or
property as ascertained for the purpose of insurance under this Ordinance;
(k) ”occupier”,
in relation to a factory, means the person who has ultimate control over the
affairs of the factory
1See foot-note 1, on page 558, supra.
2Sub-clause (v) omitted and shall be deemed always to have
been omitted by the War Risks Insurance (Amdt.) Act, 1972 (12 of 1972), s. 3
(w.e.f. 3-12-71).
and, where the affairs of the factory are entrusted to a
managing agent, such managing agent;
(l) ”owner” in
relation to a factory or building, when parts of the property insurable under
this Ordinance in relation to such factory or building are owned by different
persons, means each such person in respect of the part owned by him ;
(m) ”prescribed”
means prescribed by rules made under this Ordinance;
(n) ”Scheme”
means a War Risks Insurance Scheme prepared under section 4;
(p) ”war risks”
means such risks as may be prescribed arising from,---
(i) action taken
by an enemy or action taken in combating an enemy or in repelling an imagined
attack by ah enemy;
(ii) any
explosion or fire which involves any explosives or munitions or other
dangerous things required for war purposes and which happens, or is caused by
through or in connection with, the manufacture, storage or transportation of
any such explosives, munitions or other dangerous things;
(iii) measures
taken under proper authority to avoid the spreading of, or otherwise to
mitigate, the consequences of damage occurring (whether accidentally or not)
as the direct result of any such action as is described in sub-clause (i) or of
any such explosion or fire as is described in sub clause (ii);
(iv) precautionary
or preparatory meanures taken under proper authority with a view to preventing
or hindering the carrying out of any attack by an enemy, being measures
involving risks to property;
(v) precautionary
or preparatory measures involving the doing of work on land and taken under
proper authority in any way in anticipation proper authority in any way in
anticipation of enemy action, being measures involving risks to property;.
(vi) precautionary
or preparatory measures taken under proper authority with a view to denying
facilities to an enemy, being measures involving damage to or diminution Of
the value of property; and
(vii) capture or
seizure by the enemy of any ship, aircraft, vehicle or goods.
3. Ownership
in relation to goods. Save as otherwise provided in this Ordinance,
any goods shall, for the purposes of this Ordinance, be deemed to be owned,---
(a) if the
property in the goods is for the time being vested in a person, by that person;
(b) if the
property in the goods is not so vested, by any person who is for the time being
entitle, either unconditionally or conditionally, to have the property in the
goods vested in lam.
1Clause (o) omitted and shall be deemed always to have
been omitted by the War Risks Insurance (Amdt.) Act, 1972 (12 of 1972), s. 3
(w.e.f. 3-12-71).
4.—(1)
The 1[Federal
Government] may prepare one or more War Risks Insurance Schemes whereby it
undertakes in relation to any goods or property insurable under this Ordinance
the liabilities of insuring against war risks subject to the provisions of, and
to the extent provided by or under, this Ordinance, and may, by notification in
the official Gazette, put into operation any such Scheme which shall be
published with such notification.
(2) Any Scheme prepared under sub-section
(1) may be such as to secure,---
(a) that me
liability of the 1[Federal
Government] as insurer shall hot exceed such percentage of insurable value of
the goods” or property as may be prescribed in relation to any goods or
property or any class of goods or property;
(b) that in
respect of each claim the issued shall bear such percentage of loss or damage
as maybe prescribed in relation to any goods or property or any class of goods
or property, or such other amount as may be fixed with reference to the
insurable value of prescribed scale, whichever is greater;
(c) that any
liability of the '[Federal Government] as insurer in relation to any goods or
property is determined by the policy of insurance issued by a person acting on
behalf of the 1[Federal Government] in such form and for such period as may by
prescribed in relation to such goods or property under different circumstances;
(d) that any
premium under a policy so issued is payable at such rate, and the amount of any
one such premium is not less than such sum, as may, from time to time, be
prescribed for different description of goods or kinds of property in respect
of different period and under different circumstances.
(3) When the rate of premium prescribed in
relation to any policy or class of policies for any period fixed for the
purpose is altered during the continuance of such policies, the rate so altered
shall be the rate applicable to all policies under which premiums are payable
in respect of that period notwithstanding that the policies may have been
issued on payment of premium at the rate in force before the alteration; and
any policy issued on payment at the rate in force before the alteration shall,
when the rate has been increased by such alteration, cease to be valid on such
date as may be fixed in this behalf by the 1[Federal
Government], unless before such date any deficiency in the amount paid as
premium is made good by the policy holder.
5. Scheme with respect to property. Any Scheme with respect to any property insurable under
this Ordinance may provide,---
(a) for
undertaking in relation to works in course of construction which when completed
will become a property insurable under this Ordinance, the same liabilities as
are undertaken by the Scheme appertaining to such property;
(b) that the payments
due under a policy of insurance issued under the Scheme may, at the option of
the1[Federal
Government] take either of the following forms, namely:---
1See foot-note 1, on page 558, supra.
(i) payment,
within the limit of the liability assumed by the 1[Federal
Government] in such manner and by such instalments as the 1[Federal
Government] may think fit, of the cost necessary to restore the property as far
as practicable to the condition in which it existed before the occurrence of
the damage; or
(ii) compensation,
within the aforesaid limits, for the loss in value ascertained on the basis of
values and prices ruling at the time at which the policy of insurance was taken
out, or at which the loss occurred, whichever is less, suffered by the property
as a result of the damage, after due allowance has been made for depreciation
during the current period of insurance cover;
(c) for the
postponement, in accordance with such principles and under such circumstances
as may be prescribed, of payments due under a policy of insurance issued under
the Scheme in respect of any damage sustained by property insured thereunder;
(d) for making it
a condition of any policy of insurance issued under the Scheme,---
(i) that the
owner or occupied of a property shall comply with all regulations or
instructions made or issued under the authority of Government for safeguarding
the property against damage from war risks; or
(ii) that, where
the 1[Federal
Government] exercises its option to pay the cost necessary to restore the
property to its original conditions, the owner of the property shall, if so
required by the 1[Federal
Government] repair or reconstruct the property or remove it to another locality
and reconstruct thereon.
6. Scheme with respect of goods and in
transit. Any Scheme with respect to
goods or goods in transit may extend to,---
(a) the
undertaking by the 1[Federal
Government] of the liability of insuring any person against war risks in
respect of goods or goods in transit insurable under this Ordinance which are
not owned by him but in which he has an interest arising in the course of his
business; or
(b) the
undertaking by the 1[Federal
Government] of the liability of insuring any person against war risks in
respect of goods imported into Pakistan through any port, while such goods are
situated at such port or are in transit from such port to a place in Pakistan;
1See foot-note 1, on page 558 supra.
(c) the
undertaking by the 1[Federal
Government] in relation to a Provincial Government, of the liability of
insuring the Provincial Government in such special cases as it thinks fit
against war risks with respect to goods or goods in transit insurable under
this Ordinance for the time being owned by the Provincial Government.
7. Extend of Scheme with respect to
property. Any Scheme with respect to
property insurable under this Ordinance may extend to the undertaking by
the 1[Federal
Government] in relation to any person in Pakistan, of the liability of insuring
such person against war risks with respect to any such property which is not
owned by him but in which he has an interest up to the extent of such interest.
8. Compulsory insurance of goods.—(1) On or after such date as the 1[Federal
Government] may, by notification in the official Gazette, specify, every owner
of any goods or goods in transit insurable under this Ordinance shall take out
a policy of insurance against war risks issued in accordance with the Scheme
relating to such goods or goods in transit.
(2) The provisions of sub-section (1) shall
not apply,---
(i) to goods
insurable under this Ordinance, other than goods in transit referred to in
sub-clause (ii) of clause (h) of section 2, if and so long as the value of such
goods does not exceed such amount as the federal Government] may, by notification
in the official Gazette, specify in this behalf; or
(ii) to goods of
any description which the federal Government] may, by notification in the
official Gazette, specify in this behalf.
9. Compulsory
insurance of factories.—(1) Every owner of a factory or a factory under
construction exceeding in value such amount as the federal Government] may, by
notification in the official Gazette, specify in this behalf, except a factory
belonging to the 1[Federal
Government] or a Provincial Government or a factory exempted under sub-section
(2), shall, by such date as the 1[federal
Government] may, by a like notification, specify in this behalf; take out a
policy of insurance, against war risks issued in accordance with the Scheme
whereby he is insured in respect of all property which appertains to the
factory for a sum not less than the insurable value of such property:
Provided that, where the owner of the
factory is not himself the occupier of the factory, the occupier of the factory
shall, unless the owner has already taken out a policy of insurance as required
by this sub-section, himself take out a policy and in such a case the occupier
shall be deemed to act as the agent of the owner and shall be entitled to
receive from the owner all sums paid as premiums on the policy.
(2) The 1[Federal
Government] may, by notification in the official Gazette, except from the
operation of sub-section (1) any factory, or any description of factories, belonging
to or managed by a corporation established by or under any law for the time
being in force.
1See foot-note 1, on page 558 supra.
10. Compulsory
insurance of buildings. Every company which owns a building, or a
building under construction exceeding in value such amount as the 1[Federal
Government] may, by notification in the official Gazette, specify in this
behalf, shall, by such date as the1[Federal
Government] may, by a like notification, specify in this behalf, take out a
policy of insurance against war risks issued in accordance with the Scheme
whereby the owner is insured in respect of all property insurable under this
Ordinance which appertains to the building for a sum not less than the
insurable value of such property.
11. [Compulsory
Insurance of ships] Omitted by and shall be deemed to have been omitted by the
War Risks Insurance (Amendment) Act, 1972 (XII of 1972), s. 4.
12. Obligation under section 9, or
section 10 includes obligation to insure repaired or reconstructed
property. The obligation imposed by
section 9, 2[or
section 10] includes, where the owner of a property insured under this
Ordinance is required by the 1[Federal
Government] to repair reconstruct such property which has suffered damage, an
obligation to lake out an additional policy of insurance in respect I of the
property so repaired or reconstructed.
13. Penalty for contravention of sections
8, 9, or section 10. Whoever
contravenes the provisions of section 8, section 9 3[or
section 10] or, having taken out a policy of insurance, fails to pay any
instalment of premium thereon which is subsequently due shall be liable to pay,
in addition to the premium due from him, a surcharge equal to twenty per cent
of the premium so due as also interest at the rate of one per cent per annum
above bank rate calculated at monthly rates:---
Provided that the 1[Federal
Government] may, if satisfied that the contravention of the provisions of
section 8, section 9, 1[or
section 10] or failure to pay any instalment of premium by any person was due
to his having become destitute or having been prevented by circumstances beyond
his control from complying with the provisions aforesaid or paying the instalment
of premium, by order in writing, waive the recovery from such person of the
whole or any part of the surcharge and interest payable by him.
14. Transfer of property insured under
this Ordinance. When a property in
respect of which a policy of insurance is obligatory and has been taken out as
is required by this Ordinance is transferred from one owner to another or there
is a change of occupier of such property, the policy may, subject to the rules,
if any, made in this behalf be transferred to the. new owner or occupier, and
such new owner or occupier shall succeed .to all rights and liabilities under
and in relation to the policy as if the policy had been in the first instance
taken out by him.
15. War Risks Insurance Funds.—(1) The 1[Federal
Government] shall establish a Fund to be called the War Risks. Insurance Fund
in which shall be paid all sums received by the 1[Federal
Government] by way of insurance premiums under any Scheme or by way of payments
made on composition of offences under this Ordinance and out of which shall be
paid all sums required for the discharge by the 1[Federal,
Government] of any of its liabilities under any Scheme or for the payment by
the 1[Federal
Government] of the remuneration and expenses of agents employed under section
17.
(2) Where the 1[Federal
Government] requires the owner of any property insured under this Ordinance to
repair the property or to remove and reconstruct it in another place, it shall
make to such owner out of the Fund such payment, in addition to any sums
payable under the policy of insurance,
1See foot-note 1, on page 558, supra.
2Subs by the War Risks Insurance (Amdt.) Act, 1972 (12 of
1972), s. 5, for “section 10 or section 11” (w.e.f. 3-12-71).
3Subs. by the War Risks Insurance (Amdt.) Act, 1972 (12 of
1972), s. 5, for “section 10 or section 11” (w.e.f. 3-12-17).
as it
considers sufficient to defray the cost of repair, removal or reconstruction,
and, if necessary, replacement of any part of the property in respect of which
no compensation is payable.
(3) If, at any time when a payment is to be
made out of the Fund the sum standing to the credit of the Fund is less than
the sum required for the making of that payment, an amount equal to the
deficiency shall be paid into, the Fund as an advance out of general revenues.
(4) If, after all the liabilities of
the 1[Federal
Government] under this Ordinance have been met, there remains a surplus in the
Fund, such surplus shall be transferred to a Fund which shall be created for
the purpose and shall be utilised for meeting any losses , in any future emergency.
(5) The 1[Federal
Government] shall prepare in such form and manner as may be prescribed, and
shall publish either annually or at such intervals as may be prescribed, an
account of all sums receive into and paid out of the Fund.
(6) Notwithstanding anything contained in
sub-section (1), the 1[Federal
Government] may establish two or more War Risks Insurance Funds each to cover
one or more Schemes under this Ordinance and the provisions of this section
shall apply to each such Fund.
16. Power of Federal Government to extend
Ordinance to certain undertakings, etc.—(1)
The 1[Federal
Government] may, by notification in the official Gazette, declare that the
provisions of this Ordinance and of any Scheme made thereunder relating to
factories shall apply to the insuring against war risks of,---
(a) the machinery
above ground appertaining to mines, as defined in the Mines Act, 1923.
(b) the
distribution systems of gas supply undertakings, or
(c) the whole or
a specified part of the distribution and transmission systems, sub-stations,
switch houses and transformer houses of electric supply undertakings generally
or of specified electric supply undertakings,
as they
apply to property insurable under this Ordinance which appertains to a factory.
(2) In interpreting this Ordinance applied
by a notification under clause (a) of sub-section (1) to mines, references to
the owner of a factory shall be read as references to the owner or agent of a
mine as defined in the Mines Act, 1923, and references to the occupier of a
factory shall be read as references to the manager of mine for the purposes of
that Act.
2[16A. Certain premiums and claims not payable. Notwithstanding anything contained in this Ordinance,
unless the 2[Federal
Government], by notification in the official Gazette, otherwise directs, no
premium shall be payable on a policy of insurance taken out in pursuance of
this Ordinance in respect of any goods or property situated in East Pakistan
nor shall any claim be payable for any damage suffered by any goods or property
to which such a policy of insurance relates.]
17. Employment
of agents by Federal Government. The 1[Federal
Government] may employ, or authorize the employment of, any person of firm to
act as its agent for any of the purposes of this Ordinance and may pay to a
person or firm so employed such remuneration as it thinks fit.
1See foot-note 1, on page 558 supra.
2New section 16A ins. by the War Risks Insurance (Amdt.)
Act, 1972 (12 of 1972), s. 7, (w.e.f. 3-12-71).
18. Power to call for information.—(1) Any person authorised in this behalf by the 1[Federal
Government] may, for the purpose of ascertaining whether or not any goods or
property insurable under this Ordinance has been so insured, or for the
purposes of determining the insurable value of any goods or property insured,
or required or proposed to be insured, under this Ordinance, or for the purpose
of assessing the damage suffered by any goods or property insured under this
Ordinance,---
(a) require the
owner or occupier of any goods or property, or any person carrying on in
Pakistan the business of any kinds of insurance or banking or of selling goods
to submit to him by such date as he may specify such accounts, books or other
documents or to furnish to him such information as he may reasonably consider
necessary, and
(b) at any
reasonable time,---
(i) enter into
any premises occupied or otherwise used by any such person or any premises
containing or comprising any goods or property insurable under this Ordinance,
(ii) inspect any
such premises and goods contained therein, and
(iii) require any
person found in or on any such premises whom he believes to be in possession
of, or otherwise capable of furnishing information relevant to his
investigation to furnish to him such information as he may reasonably think
necessary.
(2) Whoever wilfully obstruct any person in
the exercise of his powers under sub-section (1) or fails without reasonable
cause to comply with anything required of him thereunder shall, in respect of
each such obstruction or failure, be punishable with fine which may extend to five
thousand rupees and with a further fine “which may extend to one thousand
rupees for every day after the first during which the obstruction or failure
continues.
(3) Whoever, in purporting to comply with
his obligations under sub-section (1), knowingly or recklessly makes a
statement false in material particular, shall be punishable with imprisonment
which may extend to two years, or with fine which may extend to one thousand
rupees.
19. Restriction on carrying on certain
insurance business.—(1) After the date on
which any Scheme or part of any Scheme is put into operation, no person shall,
except a person employed by the “[Federal Government] as its agent to issue
policies in pursuance of such Scheme, carry on the business of insuring against
war risks any goods or property insurable under this Ordinance:---
Provided that nothing in this section shall
be construed as absolving any person carrying on the business of insurance from
the liabilities assumed or incurred by him relating to war risks before the
commencement of this Ordinance.
(2) Whoever contravenes the provisions of
sub-section (1) shall be punishable with fine which may extend to five thousand
rupees and with a further fine which may extend to one thousand rupees for
every day after the first during which the contravention continues.
1See foot-note I on page 558, supra.
20. Recovery
of arrears of premium instalments. Any instalment of premium due on a
policy required to be taken out under any of the Schemes or any sum due under
section 13 may be recovered as an arrear of land revenue.
21. Limitation of prosecution. No prosecution for any offence punishable under this
Ordinance shall be instituted against any person except by, or with the
sanction of, the 1[Federal
Government] or an authority authorised by it in this behalf.
22. Composition of offences. Any offence under this Ordinance may, either before or
after the institution of the prosecution, be compounded by the 1[Federal
Government] or by any authority authorized by it in this behalf, on payment for
credit to the Fund, or, when there are more than one fund, to the appropriate
Fund determined by the1[Federal
Government], of such sum as the 1[Federal
Government] or such authority, as the case may be, thinks, fit.
23. Bar of legal proceedings. No suit, prosecution or other legal proceeding shall lie
against any person for anything which is in good faith done or intended to be
done under this Ordinance.
24. Delegation of powers. The 1[Federal
Government] may, by notification in the official Gazette, direct that the
powers exercisable by it under this Ordinance shall, in such circumstances and
under such conditions, if any, as may be specified in the notification, be
exercisable also by such officer or authority as may be so specified.
25. Power to make rules. The 1[Federal
Government] may, by notification in the official Gazette, make rules for
carrying out the purposes of this Ordinance.
1See footnote 1 on page 558 supra.
2For the War-Risks Insurance Rules, 1971, see S.R.O. No.
567(1)/71, dated 5-12-71 Gaz. of P., 1971, Ext., (
Go to Index
| LL. B. – I | LL. B. – II
| LL. B. – III | LL. B.
Directory | Home