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Contractor's All Risk Insurance
Buildings, Plant and Machinery have to be
erected/installed before commercial production could
take place. During the construction/installation
period, insurance protection is needed until the
buildings/ plant and machinery are finally handed
over to the Principal by the contractor.
Insured
The Principal/ Main Contractors/ Sub-contractors
f.t.r.r.& i.Cover
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Section I - Material
Damage
This section of the insurance covers the
contract works (Buildings, Plant and
Machinery) of the Insured against any
unforeseen and sudden physical loss or
damage from any cause e.g. fire, lightning,
collapse, collision, impact, malicious
damage, theft/ burglary, flood, windstorm
and most form of accidental damage unless
specifically excluded.
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Section II - Third Party
Liability
This section of the insurance covers the
liability of the Insured against any
liability in respect of third party bodily
injury or property damage arising out and in
the course of the construction works. |
In case of plant and machinery, the policy can be
extended to cover testing and expires after the
first test operation or test loading is completed,
or after taking over or expiry date of the policy
whichever shall be earlier.
Duration Of Cover
The cover commences directly upon commencement of
work or after the unloading of the property insured
at the contract site and expires for parts of the
insured contract works taken over or put into
service or expiry date of the policy whichever shall
be earlier
Major Exclusion (Section I
& II)
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a. |
The deductible stated in the
Schedule to be borne by the Insured in any
one occurrence
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b. |
Consequential loss of any
king or description whatsoever including
penalties, losses due to delay, lack of
performance, loss of contract
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c. |
Loss or damage due to faulty
design
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d. |
The cost of replacement,
repair or rectification of defective
material and/or workmanship, but this
exclusion shall be limited to the items
immediately affected and shall not be deemed
to excluded loss of road damage to correctly
executed items resulting from an accident
due to such defective material and/or
workmanship
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e. |
Wear and tear, corrosion,
oxidation, deterioration due to lack of use
and normal atmospheric conditions
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f. |
Mechanical and/or electrical
breakdown or derangement of construction
plant, equipment and construction machinery
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g. |
Loss of or damage to
vehicles licensed for general road use or
water borne vessels or aircraft
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h. |
Loss of or damage to files,
drawings, accounts, bills, currency, stamps,
deeds, evidences of debt, notes, securities,
cheques
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i. |
Loss or damage discovered
only at the time of taking inventory
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j. |
Any accidents caused by
vehicles licensed for general road use or by
waterborne vessel or aircraft
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k. |
Any agreement by the Insured
to pay any sum by way of indemnity or
otherwise unless such liability would have
attached also in the absence of such
agreement
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l. |
Others |
Interest Insured
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a. |
Section I - Material
Damage
Contract works which consists of the full
value of the contract works (Buildings,
Plant & Machinery) at the completion of the
construction/ installation. This valuation
would include freight, customs dues and
construction costs. It is common practice
for the principal to supply the contractor
with material on "free issue" to be built
into the contract works. The value of such
materials would not be reflected in the
contract price and so the sum insured should
be appropriately increased.
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b. |
Section II - Third Party
Liability
Liability to third party bodily injury or
property damage claim. |
Special Points
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a. |
Constructional plant and
equipment such as site offices, site power
generating equipment, scaffolding, air
compressors, welding equipment, concrete
silos and mixers may be included, in a
separate sum insured representing the new
replacement value of such equipment.
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b. |
Construction Machinery.
Defined as all "plant and machinery" which
renders its service only when moving and
under control of an operator e.g. cranes,
bulldozers, excavators, graders, loaders,
pile driving & pile extracting units,
trucks/lorries, site railways, concrete
pumping plant. When on site, construction
machinery may be insured under the policy.
In such cases a complete list of these items
showing the new replacement values is to be
appended to the policy.
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c. |
Debris clearance. The cost
of debris removal following an accident is
part of the claim under the policy to the
extent that it is necessary before repairs
may be put in hand. General debris removal
costs for site clearance may be insured as a
separate item under the policy.
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d. |
Expediting. The insurance
may be extended for additional premium to
cover the extra cost of overtime rates of
wages, express delivery, air freight, etc.
in connection with repairs or replacements
indemnifiable under the policy.
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e. |
Insured's surrounding
property. When the insurance includes the
interest of the purchaser and involves
extensions to or work adjoining existing
premises, there is a risk of such premises
and their contents being damaged as a result
of accidents arising out of the construction
operations.
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f. |
Temporary works. Works
constructed by the Insured on site to
facilitate construction of the permanent
contract works including coffer dams,
shuttering, temporary diversions of
waterways, etc. are exposed to the same
hazards as the contract works. These
temporary works may also be insured and the
sum insured should be suitably increased to
include their value.
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g. |
Third Party liability. Where
the contract wording stipulates that the
insurance is to be for joint interests
(principal, contractor and subcontractors)
the third party insurance is granted to each
party separately. This allows one insured
party to take action against another and
seek indemnity under the policy. However,
persons occupied on the construction site
are not covered under the policy against
accidents at work if they are or could have
been insured under Workmen's Compensation
and/or Employer's Liability insurance.
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h. |
Maintenance. Section I of
the policy can be extended to cover, to a
certain extent, loss of or damage to the
construction/erection works occurring during
this period. |
Information /Details
Required For Quotation Purpose
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a. |
Contract Value together with
its breakdown details (Buildings, plant &
machinery) |
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b. |
Period of Insurance |
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c. |
Period of Maintenance Cover |
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d. |
Name of Main Contractor |
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e. |
Third Party Limit of
Liability |
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f. |
Work Schedule |
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g. |
Details surrounding property |
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h. |
Location map |
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h. |
Tender documents |
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