Power Surge and Scorching Damage Clause
The power surge and scorching damage clause expressly brings damage from lightning-induced power surges or scorching without an actual fire within fire or electronic equipment cover, since neither would otherwise be covered under the narrow definition of fire.
- Clause type
- Extension
- Origin/Market
- German market
- Favours
- Insured
- Negotiability
- Negotiable
Standard wordings
- GDV SK 3114 power surge damage caused by lightning strike or other atmospheric electricity
- GDV SK 3111 power surge damage caused by lightning in agricultural businesses
Purpose
Standard German fire conditions (AFB) define “fire” as a blaze capable of spreading by itself. Scorching damage – for instance from a smouldering cigarette or flying sparks – does not meet this definition and is therefore excluded declaratorily unless specifically agreed. Likewise, power surge damage – the indirect effect of a lightning strike on electrical installations transmitted through the wiring network – falls outside the narrow concept of a direct lightning strike. The clause closes both gaps by expressly bringing scorching and power surge damage within cover.
Effect and limits
Under SK 3114, power surge damage to electrical installations caused by lightning strike or other atmospheric electricity is covered even where there is no direct lightning strike on the building itself. SK 3111 provides a narrower variant specifically for agricultural businesses. Scorching damage is usually automatically covered only as a consequential loss of an insured event (lightning, explosion, fire); as a standalone cause of loss without a preceding fire it regularly needs to be included separately. In electronic equipment insurance, by contrast, power surge is typically already an insured peril within the basic scope of cover.
Negotiation and practice
Businesses with a high proportion of sensitive electronic equipment should consider whether a dedicated electronic equipment policy with broader power surge protection is more appropriate than an add-on to the fire policy. Agricultural businesses should specifically check for SK 3111, since standard property clauses often fail to address this particular exposure.