Professional Documents
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C
T
2
T
1
B
A
HEAT
A – ALTERNATOR T 1 – TURBINE
B – BOILER T 2 – TRANSFORMER (STEP UP)
C - CONDENSOR
POLICIES RECOMMENDED ARE
TESTING Yes No
COVERAGE
MINIMUM POLICY 1E +1T months 3 months
PERIOD
• PRINCIPAL
• ENGINEERING CONSULTANT
• CONTRACTOR
• SUB - CONTRACTOR
• MANUFACTURER
• FINANCIER
ERECTION ALL RISK
(EAR/SCE/CAR)
SCOPE OF COVER:
• LOCATION RISKS: FIRE, THEFT, BURGLARY,
• HANDLING RISKS: IMPACT
• TESTING & COMMISSIONING RISKS: LEAKAGE
OF ELECTRICITY, EXPLOSION
• RISK OF HUMAN:CARELESSNESS,STRIKE,RIOT,
FAULT IN ERECTION
• A.O.G.: STORM,TEMPEST,FLOOD, EARTHQUAKE.
POLICY PERIOD :
FROM: DT. OF ARRIVAL OF MATERIAL AT SITE
ERECTION ALL RISK (EAR/SCE/CAR)
EXTENSIONS:
• Expediting cost including express freight, air freight
• Additional custom duty
• Owners surrounding property
• C.P.M.
• Maintenance covers (Maintenance visit cover & Extended
maintenance cover)
• Earthquake
• Clearance & removal of debris
• Third party liability with cross liability
• Loss minimisation expenses
• Professional fees
• Offsite storage & fabrication
• Escalation
• Design defect cover-as per DE2 & DE3 wording(for CAR ) &
DE4 wording (for EAR)
PREMIUM RATING
CAR TARIFF RATES VARY ACCORDING TO TYPES OF
CONTRACT WORK. e.g.
GENERAL
• WAR,& WARLIKE OPERATION
• NUCLEAR REACTION
• WILFUL NEGLIGENCE OF INSURED
• CESSATION OF WORK (TOTAL/PARTIAL)
MATERIAL DAMAGE
• EXCESS
• LOSS WHILE TAKING INVENTORY
• NORMAL WEAR & TEAR
• FAULTY DESIGN, DEFECTIVE
MATERIAL/DEFECTIVE WORKMANSHIP
• PACKING MATERIAL
CONTRACTORS ALL RISK (CAR )
EXCLUSION:
GENERAL
• WAR,& WARLIKE OPERATION
• NUCLEAR REACTION
• WILFUL NEGLIGENCE OF INSURED
• CESSATION OF WORK (TOTAL/PARTIAL)
MATERIAL DAMAGE
• EXCESS
• NORMAL WEAR AND TEAR
• FAULTY DESIGN.
• LOSS DISCOVERED AT TIME OF INVENTORY.
• FILES, DRAWINGS, ,CHEQUES ETC.
• PACKING MATERIAL.
• VEHICLES LICENSED FOR ROAD USE
• PENALTIES UNDER CONTRACT
• BREAKAGE OF GLASS
EXCESS
Excess is applicable per incident
Separate Incident – Freedom from perils for 7
consecutive days(Projects up to 100cr)
MAJOR PERIL=AOG+COLLAPSE+WET RISK
CAR EAR
STORAGE & CONSTRUCTION STORAGE & ERECTION
CLAIMS CLAIMS
20% 50%
10% 40%
THIRD PARTY LIABILITY
FOR POLICIES WORTH TPL SI
AIR FREIGHT
Reinstatement of SI after loss is possible.
Additional Excess – 5% Air Freight incurred.
Defective workmanship
EAR policy coverage includes DE3, whereas DE4 and DE5 are additional covers.
DESIGN DEFECT COVERAGE IN
CAR
Outright rejection-Nothing is
DE1
payable
DE2 Only ‘Floor is payable
The basic CAR policy provides the equivalent of DE 1 with respect to faulty design. It excludes all design-
related loss or damage. For defective materials or workmanship, however, this policy provides much broader
cover - that is, the equivalent of DE 4 (full cover except for the "faulty part").
COMPARISON – DE (LONDON MARKET WORDING) &
LEG (LONDON ENGINEERING GROUP WORDING)
DE1/95 Excludes all loss or damage due to defective elements LEG1/96 Excludes all loss or damage due
to defective elements
DE2/95 Excludes property that is defective and property that relies on the No equivalent LEG clauuses
defective property for its support and costs to access the defective
property (“access costs”). Covers other insured property that is free of
defect but is damaged by the defective property.
DE3/95 Excludes property that is defective and access costs. Covers other LEG2/96 Excludes any component part
insured property that is free of defect and is damaged by the defective or individual item that is defective and
property. also access costs. Covers damage to
property containing the defects and other
DE4/95 Excludes any component, part or individual item that is defective parts of the insured property that are
and also access costs. But gives cover for other parts or items of the free of defect, provided there is damage
insured property that are free of defect and damaged by the defective to the defective portion. To quantify
part cover, exclude the costs of correcting the
defect, which would have been incurred,
had this correction been carried out
immediately before damage occurred
DE5/95 Provides full cover for both defective and non-defective property LEG3/06 Provides full cover for both the
provided there is damage to the non-defective insured property as a result defective and non-defective property
of the defect. No cover is provided for the costs of improvements to the provided there is damage to any portion
original design, plan, specification, workmanship or materials of the property containing the defect as a
result of the defect. No cover is provided
for the costs of improvements to the
original design, plan, specification,
workmanship or materials.
DE 1 DE2 DE3 DE4 DE5 LEG3 LEG2 LEG1
Costs to rectify defects in the
absence of damage
Costs to improve (original)
Design, Plan, Specification,
Workmanship or Material
Loss, damage or costs incurred
in accessing defective
Property/Part
FAULTY DE 3 DE 1 DE 4, DE 5 DE 2, DE 3
DESIGN DE 4
b) in the case of a total loss the actual value of the items immediately
before the occurrence of the loss less salvage;
However, only to the extent the costs claimed has to be borne by the
Insured and to the extent they are included in the Sum Insured and
provided always that the provisions and conditions have been
complied with.
MARINE -CUM ERECTION (MCE)
CONCERNED WITH ERECTION OF PLANT AND
MACHINERY.
POLICY PERIOD:
FROM: EQUP. LEAVE THE MFG. WAREHOUSE
TO FINAL COMMISSIONING
SCOPE OF COVER:
AS PER EAR INSURANCE & MARINE(A/R).
ADVANCED LOSS OF PROFIT(ALOP)
SCOPE OF COVER
• POLICY COVERS FINANCIAL CONSEQUENCES OF A
PROJECT BEING DELAYED DUE TO ACCIDENTAL
DAMAGE TO THE PROJECT MATERIAL DURING
ERECTION/TESTING STAGES.
• IT FOLLOWS IN PRINCIPLE THE CHARACTERISTICS
OF AN ANNUAL CONSEQUENTIAL LOSS POLICY, BUT
IS ISSUED IN ADVANCE OF THE ACTUAL
COMMENCEMENT OF THE BUSINESS SINCE IT IS A
COMPULSION FROM THE FINANCERS OF THE
PROJECT
ADVANCED LOSS OF PROFIT(ALOP)
OBJECT OF ALOP-
• INDEMNIFY THE PRINCIPAL OR THE PROJECT
OWNER FOR THE ACTUAL FINANCIAL LOSS
SUSTAINED DUE TO DELAY IN COMMENCEMENT OF
COMMERCIAL OPERATIONS OF A NEW PROJECT
WHICH IS UNDER INSTALLATION/ CONSTRUCTION
• DELAY MUST BE CAUSED BY DIRECT PHYSICAL
LOSS OR DAMAGE ADMISSIBLE UNDER MATERIAL
DAMAGE CAR/EAR POLICIES COVERING THE
CONTRACT WORKS
• SUM INSURED IS COMPUTED ON THE BASIS OF THE
FINANCIAL MODEL OF THE PROJECT
OPERATIONAL PHASE
MACHINERY BREAKDOWN
INSURANCE
• ELECTRICAL MACHINERY
• MECHANICAL MACHINERY
• BOILERS
• LIFTS
• SWITCH GEARS
• CABLES
• FURNACES
MACHINERY BREAKDOWN INSURANCE
SCOPE OF COVER:
UNFORESEEN ACCIDENTAL
BREAKDOWNS/PHYSICAL DAMAGE SUCH AS
• ELECTRICAL SHORT CIRCUIT
• ENTRY OF FOREIGN MATERIAL
• NEGLIGENCE
• LUBRICATION FAILURE
• INSULATION FAILURE
• METALLURGICAL FAILURE
MACHINERY BREAKDOWN INSURANCE
The insured items are covered after successful
completion of their performance/acceptance tests
1. WHILE IT IS AT WORK OR AT REST OR
2. WHILE BEING DISMANTLED FOR
CLEANING OR OVERHAULING OR
3. DURING CLEANING OR OVERHAULING
4. DURING SUBSEQUENT ERECTION/
REASSEMBLY OR
5. WHILE BEING SHIFTED WITHIN THE
INSURED PREMISES
MACHINERY BREAKDOWN INSURANCE
EXCLUSIONS
• Fire and allied perils including explosion of any kind
(other than bursting or disruption of turbines,
compressors, cylinders of steam engines, hydraulic
cylinders or fly wheels or other apparatus subject to
centrifugal force, internal pressure)
• War group perils
• Atomic energy, radiation, nuclear
• Overloading experiments
• Gradually developing defects(gradually developing
flaws, defects, cracks or partial fractures in any part
not necessitating immediate stoppage, although at
some future time repair or renewal of the parts affected
may be necessary. )
MACHINERY BREAKDOWN INSURANCE
EXCLUSIONS
• Normal wear & tear
• Wilful act, wilful neglect
• Liability assumed by the insured by agreement
• Defects existing at the time of insurance and known
to the insured (design defects are covered)
• Consequential loss
• All types of boiler explosions including pressure
explosion, chemical, smelt water and flue gas
explosions.
MACHINERY BREAKDOWN INSURANCE
EXCLUSIONS
• Loss of or damage to belts, ropes, chains, rubber tyres,
dies, moulds, blades, cutters, knives or exchangeable tools,
engraved or impression cylinders or rolls; objects made of
glass, porcelain, ceramics, all operating media (e.g.
lubricating oil, fuel, catalyst, refrigerant, dowtherm) felts,
endless conveyor belts or wires; sieves, fabrics, heat
resisting and anti-corrosive lining and parts of similar
nature, packing material, parts not made of metal (except
insulating material) and non-metallic lining or coating of
metal parts.
• Loss or damage for which the manufacturer or supplier or
repairer of the property is responsible either by law or
contract.
• Excess
MACHINERY BREAKDOWN INSURANCE
SUM INSURED :
CURRENT NEW REPLACEMENT VALUE OF THE
EQUIPMENT.
PREMIUM RATING :
AS PER TARIFF SEPARATELY FOR
• ELECTRICAL MACHINERY
• MECHANICAL EQUIPMENTS
• MACHINERY IN COLD STORAGES
• EQUIPMENTS IN FERTILISERS/
PETROCHEMICALPLANTS.
Cover for part of machinery and Gear Boxes
BASIS OF INDEMNITY :
• PARTIAL LOSS: EXPENSES INCURRED TO RESTORE
THE DAMAGED M/C TO ITS FORMER STATE. NO
DEPRECIATION FOR REPAIRS.EXCEPT FOR
LIMITED LIFE PARTS.
• MEDICAL EQUIPMENTS
• TELECOMMUNICATION EQUIPMENT
• AUDIO-VISUAL EQUIPMENT.
ELECTRONIC EQUIPMENT
INSURANCE
THREE SECTIONS:
1.MATERIAL DAMAGE
• CONSEQUENTIAL LOSS
ELECTRONIC EQUIPMENT
INSURANCE
SUM INSURED :
PREMIUM RATING :
AS PER TARIFF
MAINTENANCE WARRANTY:
SAFETY CHECKS
PREVENTIVE MAINTENANCE
ELECTRONIC EQUIPMENT INSURANCE
BASIS OF INDEMNITY :
• PARTIAL LOSS: EXPENSES INCURRED TO RESTORE
THE DAMAGED M/C TO ITS FORMER STATE.NO
DEPRECIATION FOR REPAIRS.EXCEPT FOR
LIMITED LIFE PARTS.
INSURED PROPERTY :
BOILERS /ECONOMISERS/SUPER HEATERS/ STEAM
PIPES/ PRESSURE VESSELS /OTHER VESSELS UNDER
STEAM GAS OR AIR PRESSURE
SCOPE OF COVER:
• EXPLOSION OR COLLAPSE OF INSURED BOILER
• SURROUNDING PROPERTY OF INSURED(OPTIONAL)
• TPL( OPTIONAL)
DEFINITIONS
1. ‘Boiler’ shall mean any fired closed vessel or a combined container piping system
in which steam is generated under pressure.
2. ‘Pressure Plant’ shall mean any unfired closed container under steam gas or fluid
pressure.
3. ‘Explosion’ shall mean the sudden and violent rending or tearing apart of the
permanent structure of a Boiler or Pressure Plant or any part or parts thereof by force
of internal steam gas or fluid pressure causing bodily displacement of the said
structure and accompanied by the forcible ejectment of its contents.
4. ‘Collapse’ shall mean the sudden and dangerous distortion of any part of Boiler or
Pressure Plant by bending or crushing caused by Steam Gas or Fluid Pressure
whether attended by rupture or not. It shall not mean any slowly developing
deformation due to any cause.
5. ‘Flue Gas Explosion’ shall mean an explosion of ignited gases in the furnaces or
flues of the boilers, economisers and super heaters.
EXCLUSION:
POLICY PERIOD :
ANNUAL OR SHORT PERIOD
PREMIUM RATE :
AS PER TARIFF DEPENDING ON CATEGORY OF PLANT.
EXCESS : RS.10000/.
CONTRACTORS PLANT & MACHINERY
VARIOUS MOBILE EQUIPMENTS FOR PROJECTS IN
PARTICULAR LOCATION MAY BE COVERED.
CPM IN DIFFERENT LOCATIONS MAY BE COVERED ON
FLOATER BASIS
In respect of Machinery/ equipments, whether registered with
RTO or not, but engaged at the Project site, the Insured, has
an option either to select the Motor/Non-Motor Policy under
Motor Tariff or CPM Policy in the Engineering Department
EXCLUSION
• Electrical & mechanical breakdown
• Consumables replaceable parts and attachment such as bits, drills, knives
or other cutting edges, saw blades dies, moulds, patterns, pulverizing and
crushing surfaces, screens and sieves, ropes, belts, chains, elevator and
conveyor bands, batteries, tyres, connecting wires and cables, flexible
pipes, joining and packing material regularly replaced.
• Explosion (Internal)
• Vehicles unless they are exclusively used on construction site.
• Underground CPM M/Cs -excl-k
• Wear & tear , corrosion
• Transit loss
• War perils
• Loss or damage due to abandonment of any plant and/or machinery
working in underground mines or tunnels
• pay loaders on barges
• loss or damage due to total or partial immersion in tidal waters
CONTRACTORS PLANT & MACHINERY
SUM INSURED :
CURRENT NEW REPLACEMENT VALUE OF
EQUIPMENT
POLICY PERIOD :
ANNUAL OR SHORT PERIOD
PREMIUM RATE :
AS PER TARIFF DEPENDING ON CATEGORY OF M/C.
CONTRACTORS PLANT & MACHINERY
ADDITIONAL COVERS:
• TPL
• SURROUNDING PROPERTY
• CLEARANCE AND REMOVAL OF DEBRIS
• EXPRESS FREIGHT
• AIR FREIGHT
• ADDITIONAL CUSTOMS DUTY
• UNDERGROUND MACHINES(exclusion-K)
• DISMANTLING OF CPM EQUIPMENT AND SHIFTING
TO A NEW LOCATION
CONTRACTORS PLANT & MACHINERY
BASIS OF INDEMNITY :
• PARTIAL LOSS: EXPENSES INCURRED TO RESTORE
THE DAMAGED M/C TO ITS FORMER STATE. NO
DEPRECIATION FOR REPAIRS.EXCEPT FOR
LIMITED LIFE PARTS.
SCOPE OF COVER :
• DAMAGE TO STOCK DUE TO A RISE IN TEMPERATURE
RESULTING FROM BREAKDOWN OF REFRIGERATION
PLANT (MB).
• ESCAPE OF REFRIGERANT IN THE REFRIGERATED
CHAMBER AS A DIRECT RESULT OF DAMAGE TO
MACHINERY AND PLANT .
EXCLUSION:
SUM INSURED:
WARRANTY:
• MAINTENANCE CONTRACT IN FORCE THROUGHOUT THE
CURRENCY OF THE POLICY.
• LOG BOOKS ARE MAINTAINED SHOWING THE TEMP.
READING AT REGULAR INTERVALS.
DETERIORATION OF STOCKS
INSURANCE
BASIS OF INDEMNITY: