ALOP INSURANCE

WHY ALOP/MDSU INSURANCE?

WHY NOT RELY ON LIQUIDATED DAMAGES

LIQUIDATED DAMAGES PROVIDE

VERY LIMITED COVER.
COMPLEX FORCE MAJEURE
PROVISIONS NOT COVERED.
DEBT SERVICE PAYMENTS EXCEED
AMOUNT OF LDS.
INSURANCE MARKET SECURITY
BETTER.

MD & ALOP COVER

Principal

ALOP Contractor

Insurer
MD -

ALOP CONCEPTS
THE INSURED IN ALOP IS THE PRINCIPAL
ONLY
CONCURRENT MATERIAL DAMAGE (MD)
INSURANCE
SAME INSURER(S) FOR ALOP AND MD
INSURANCE PERIOD IDENTICAL TO MD
ERECTION PERIOD

ALOP - INDEMNITY
PROVIDED
LOSS OF GROSS PROFIT DUE TO
REDUCTION IN ANTICIPATED
TURNOVER (COVERS ALSO ANY
LOSS MINIMIZING COSTS )
AND / OR
INCREASE IN COST OF WORKING
(ICOW)
SUBJECT TO M.D PROVISO

PROJECT PERIODS
Insurance Period

Max. Indemnity Period

CAR / EAR

(ALOP)

ALOP

Planning Transit

On site storage-handling

Cold Hot

Construction / Erection

Pre-

Commercial operation

Test

Scheduled date of
commencement of
insured business

ADVANCE LOSS OF PROFIT (ALOP)

Scheduled
Gross

business

Profit s/day

Commencement
Actual business
commencement

Accident

Delay

Original contract period

(Original MD- ALOP
policy period)
Final contract period
(Extended MD - ALOP policy period )

 ACCIDENT NOT IMMEDIATELY

FOLLOWED BY THE INDEMNITY
PERIOD
ONLY ONE CLAIM PER POLICY
ONLY ONE TIME EXCESS PER POLICY
MAXIMUM INDEMNITY PERIOD
SUFFICIENTLY LONG.

ONLY ONE CLAIM PER POLICY

Accident

Accident
Accident

Accident

Scheduled business commencement

DELAY

INSURED AND UNINSURED DELAYS

Fire

Shortage Negligence
of
materials
Strike

Scheduled business commencement

Uninsured
delay

Insured delay
Indemnity period

MAXIMUM INDEMNITY PERIOD IN ALOP

Orig.
Contract period
MD-ALoP

DELAY

Policy Period
Erection
& Test
Supply

RoD,
Accident

Erection & Test

Margin

Re-Supply

Schedule business commencement

Maximum Indemnity period

SUM INSURED & TIME EXCESS

SUM INSURED INCLUDES
GROSS PROFIT
AND / OR
SPECIFIED STANDING CHARGES LIKE
DEBT SERVICING CHARGES, FIXED
EXPENSES like O& M CHARGES ETC.
TIME EXCESS

ALOP CLAIM MONITORING

ANALYSIS
AND
COMPARISON
OF
QUARTERLY/MONTHLY PROGRESS REPORTS
WITH ORIGINAL BAR CHARTS
IN CASE OF LOSS / DAMAGE TO PLANT AND
EQUIPMENT TO ASCERTAIN :
TIME SPAN OF REPAIRS
WHETHER DAMAGED ITEM IS ON CRITICAL
PATH

ALOP CLAIM MONITORING

TIME SPAN OF REPLACEMENT
CAN ANY ACTIVITY BE BYPASSED TO
ACHIEVE PRODUCTION / MAINTAIN
PRODUCTION LEVELS
AN EXPERT SURVEYOR TO BE
INVOLVED FOR CONTINUOUS MONITORING
TO DISTINGUISH BETWEEN INSURED
AND UNINSURED DELAYS

CRITICAL PARAMETERS
EAR ALOP :

PROJECT PERIOD.
MAXIMUM INTERRUPTION PERIOD.
TO INCLUDE RE-ORDERING, REPROCUREMENT, LEAD TIME, RE-ERECTION
PERIOD.
CUSTOM MADE/OFF THE SHELF ITEMS .
IMPORTED/INDIGENOUS ITEMS
TEMPORARY REPAIRS/LOSS
MINIMISATION MEASURES
BASIS OF SUM INSURED:
GROSS REVENUE/GROSS PROFIT/
SELECTED STANDING CHARGES.

PROJECT PERIOD FOR

MARINE DSU
Erection

Testing

Planning
Transit Period

COD

Indemnity Period

MARINE DSU - LOSSES

COD
RCOD
Actual business
commencement
Accident
Transit

Delay

Erection &
Testing

Maximum indemnity period

CRITICAL PARAMETERS
MARINE DSU:

VALUE OF CRITICAL ITEMS PER SHIPMENT.

WHETHER TWO OR MORE CRITICAL ITEMS

WOULD BE SHIPPED BY THE SAME VESSEL.

WHETHER ON DECK OR UNDER DECK.

DETAILS OF OVER DIMENSION CONSIGNMENTS, IF

ANY (HOW THEY PROPOSE TO BE CARRIED FROM
DESTINATION PORT TO SITE)

DETAILS OF BARGE SHIPMENT IF ANY.

Thank You