What Are Allied Lines?

Allied lines are any type of property-casualty insurance closely related to fire insurance coverage. Allied lines coverage is almost always taken out along with a standard fire insurance policy. Allied lines insurance can include coverage for such things as accounts receivable, data-processing equipment, water damage, and vandalism.

Allied Lines Explained

The types of unforeseen losses covered by allied lines insurance can cause a flourishing business to suddenly find itself in a disastrous situation with major losses in property, inventory, machinery, tools, and facilities, ultimately wiping out the capital and causing consequential losses. Monetary relief is essential in rebuilding and restoring the damaged property. Allied lines coverage plays a vital role in safeguarding the financial interests of an enterprise. 

In some instances, the coverage provided by allied lines insurance is very broad. For example, if the policy covers situations that are considered acts of nature, the terms are likely to include specific events such as earthquakes, floods, lightning strikes, wind damage from tornadoes or hurricanes, and possibly even avalanches. The scope of coverage is often based on what types of natural disasters could occur within the general area where the business is located. As is true with many forms of insurance, coverage for events that have an increased possibility of occurring will carry a higher premium than those that are less likely to occur.

Along with protection from natural disasters, most allied lines policies will also provide coverage for losses resulting from structural issues with the building where the business is housed. This can include issues such as a leak in the overhead sprinklers that are part of the fire safety system, or damage to masonry or other areas of the construction that allow documents or equipment to be exposed to humidity or dampness. Often, the coverage not only provides funds to aid in the repair of the structural problem, but also to repair or replace documents or equipment that were damaged as a result of the problem.

Allied Lines Premiums and Coverages

Allied lines premiums are based on the type of occupancy, physical features, value at risk, requirement of additional covers, and information provided on a completed proposal form. 

Allied lines insurance covers a variety of perils, including but not limited to:

  • Demolition charges
  • Increased cost of construction
  • Radioactive contamination
  • Sprinkler leakage
  • Standing timber
  • Explosion
  • Riots
  • Strikes and Malicious Damage
  • Cyclone
  • Flood
  • Tidal Wave
  • Earthquake & Volcanic Eruption
  • Tsunami
  • Impact on all property insured
  • Subsidence, Collapse & Landslip