Explain the obligation imposed on the contractor to indemnify the client through several types of

insurance under PAM 2006 Standard Form of Contract

a) Insurance of Work

Clause 20.A.1 stated that the contractor shall as a condition to the commencement of any work under
the contract, take out and maintain in the joint names of the employer, contractor, subcontractor and
interested parties a CAR insurance policy. The insurance has endorsements to cover against loss
and/or damage by fire, lightning, explosion, earthquake, volcanism, tsunami, storm, cyclone, flood and
others.

b) Contractor All Risks (CAR)

CAR Insurance policy will exclude cover for construction plant, tools and equipment owned or hired by
the Contractor or any sub-contractors. The employer shall keep such works so insured
notwithstanding any agreement for Sectional Completion under Clause 21.0 or Partial Possession
under Clause 16.0. The insurance policy shall be valid up to the Completion Date and the extended
maintenance cover shall be for the Defects Liability Period plus a further 3 months.

c) Public Liabilities Insurance

Without prejudice to his liability to indemnify the government or employer, contractor shall as a
condition precedent to the commencement of any work under this contract effect and maintain such
insurances to cover the claim arising from public injuries and property damages. The example risk of
insure for civilian are authorised civilian to the construction site such as supplier, students, visitors,
consultants, S.O and SO’s representative and civilian around the construction site.

d) Workmen Compensation

This Act provides for the compensation payment to an injured employee or worker arising out of and
in the course of employment or contracting occupational disease where the employee or worker dies
in the event of fatal accident or contracting an occupational disease or in the course and arising out
performing his duty or work, the Workmen’s Compensation Act 1952 provides for the compensation
payment to the worker’s dependants.

e) SOCSO

Clause 19.2; without prejudice to his liability to indemnity the Employer under Clause 18.0, the
Contractor shall register or cause to register all local workmen employed on the Works and who are
subject to registration under the SOCSO shall cause all sub-contractors to comply with the same
provisions. The Contractor shall make payment of all contributions and cause all sub-contractors to
make similar payments from time to time when the same ought to be paid.