Erection All Risk Insurance

Sites for the erection of Machinery like Electricity Generators, Water treatment plants, Desalination plants, Elevators, etc are very busy throughout the erection period and while the Engineers, Foreman and site supervisors are trying their best to ensure safety in all respect accidents minor or major do occur. If these sites are not adequately insured, the accidents would result in devastating losses to Contractors or their principals.

Maintenance Period Risks

Once the Erection works, including testing and commissioning, covered under the EAR policy is completed the maintenance period cover comes to effect automatically. During this period the cover is against any loss &/or damage that occurs in the course of the compliance with the maintenance obligation under the contract insured/contractor’s provided the cause of such loss or damage originated during the period of insurance.

The premium chargeable is always applied on the basis on the Total Contract Value for the period of the contract and on the value of the Construction Plant & Machinery being used at the site. The rates are very dependent to the nature of the project, site location, experience of the Contractor and other relevant risks determinations. There is a Deductible and Conditions to the policy.

Erection All Risks Insurance which is in two sections provides coverage as follows:-

Section 1

All Risks Covers

This section provides coverage for losses/damages to principals and contractor/subcontractors own material and erection works from a variety of risks such as:

1. Accidental damage during construction
2. Fire, Lightning
3. Water damage, flood, storm and tempest
4. Collapse, collision, impact, burglary, theft and malicious damage, aircraft
5. Breakdown or explosion to any part of the contract e.g. lifts in buildings etc.
6. Consequent Damages due to defects in material casting, workmanship and design
7. Riot, Strike, subsidence, landslide, cyclone, hurricane, earthquake, volcano.

Section 2

Third Party Legal Liability

This section of the policy, with agreed limits, provides indemnity to third party due to the Legal liability of the insured resulting from negligence of the insured or his employees/family members causing :

1. Accidental bodily injury &/or death to third parties(Not members of the insured’s family or their employees),
2. Accidental damage to Property (excluding Property belonging to or in the custody or under the control of the Insured, his family members or his employees).
3. Provides the Legal expenses for defending any proceedings with Insurer’s consent.