Diwali 2026 · festive stock · fire and burglary
Diwali Stock Check
Shops and traders hold more stock in the weeks before Diwali than at any other time of the year, and most fire policies are set on the stock held the rest of it. Enter both figures and what your policy says, and this shows what a fire in the busiest fortnight would actually pay.
Key takeaways
- A fire claim is settled on the value at risk on the day of the loss. In the fortnight before Diwali that is your peak stock, not the stock your policy was set on.
- On IRDAI's standard policies for businesses with up to fifty crore of value at risk, Bharat Sookshma and Bharat Laghu Udyam Suraksha, underinsurance up to 15% is waived. Beyond that the claim is cut in proportion, small losses included.
- Two ways to insure the peak: raise the stock sum insured by endorsement for the season, or move stock to a declaration policy set at the peak and adjusted to what you actually held.
- After a festive loss the surveyor will ask for the stock register, purchase bills and GST returns. Stock that cannot be shown on paper is hard to claim for, however real it was.
Why the peak is the number that matters
A fire policy promises to pay the loss, but only in the proportion the sum insured bears to the value at risk at the moment of the loss. The surveyor counts the stock as it was on that day. If the fire happens in the week before Diwali, the value at risk is the festive stock, and a sum insured set on the usual stock is suddenly short.
The shortfall bites on small losses as much as large ones. A short circuit that damages a quarter of the stock is the typical claim, and it is the one most likely to be cut.
Two ways to insure the festive peak
An endorsement can raise the stock sum insured from a date you choose, for the weeks the stock is high. It is the simplest fix for a single season, and it needs to be in place before the stock arrives, not after a loss.
A declaration policy suits a business whose stock swings every month. It is set at the highest stock you expect to hold, you declare the actual stock each month, and the premium is adjusted to the average of your declarations at the end of the year. The discipline is the declarations: miss them and the policy falls back to its sum insured.
What the surveyor will ask for after a festive loss
The stock register, purchase bills for the season's stock, sales records and GST returns. These are how the stock on the day of the loss is established, and a festive claim is usually decided by whether the paperwork shows the peak.
Keep purchase bills for the festive stock together and the stock register current through the season. It costs nothing and it is the difference between a claim for the stock you had and a claim for the stock you can prove.
Burglary in the busiest weeks
Burglary policies in India respond to theft that follows forcible and violent entry into the premises. Shoplifting during the festive rush, or stock that walks out with a member of staff, is not burglary; the second is what fidelity guarantee insurance is for.
The burglary sum insured has the same problem as the fire one: set on the usual stock, it is short at the peak. Check both.
Frequently asked questions
Does my shop insurance cover the extra stock I buy for Diwali?
Only up to the sum insured. If the stock on the day of a loss is worth more than the policy insures, the claim is paid in proportion, unless the shortfall is inside the 15% underinsurance waiver of IRDAI's standard policies for businesses up to fifty crore of value at risk.
Can I increase my sum insured for the festive season only?
Yes. An endorsement can raise the stock sum insured from a date you choose. It has to be in place before the stock arrives; it cannot be added after a loss.
What is a declaration policy?
A fire policy for fluctuating stock. It is set at the highest stock you expect, you declare the actual stock monthly, and the premium is adjusted to the average declared at the end of the year.
What documents prove stock after a fire?
The stock register, purchase bills, sales records and GST returns. The surveyor uses them to establish the stock on the day of the loss.
Is theft of stock during the Diwali rush covered?
Burglary policies cover theft following forcible and violent entry into the premises. Shoplifting is generally not covered, and theft by staff is a fidelity guarantee risk, a separate policy.
Related: Sum insured calculator · Shopkeeper's policy · Fire and burglary insurance · Retail shops · Fidelity guarantee, for theft by staff