Construction Insurances

03/09/10
 Types of Insurances
 Type 1
• covers damage to property, such as building works,
other premises or a business, such as a contractor’s all
risks policy, plant & machinery etc

 Type 2
• covers liability to another party, and includes
professional indemnity insurance, employers’ liability
insurance, and public liability insurance
 Contractors All Risk Insurance
 Principal – Employer
 Insured - Employer, Engineer, Contractor, SC
 Coverage
 covers the risk of physical damage to materials to be used for the
project whether in transit, in storage or forming part of Works
 Valid upto DLP
 Sum Insured
 Material damage - Full contract value inclusive of all materials
 Third party liability
 Significant Exclusions
 loss or damage due to willful misconduct, cessation of work whether
total or partial, delay, damage due to faulty design, rectification of
defective material and/or workmanship inventory losses etc.
 3rd Party Liability Insurance
 Principal – Employer
 Insured – 3rd Party
 Coverage
 covers the risk of physical injury to Third Parties or Members of
the public or their property
 Also known as Public Liability Insurance
 Extended in CAR
 Valid upto DLP
 Sum Insured
 Depends on the existing/surrounding conditions
 Significant Exclusions
 loss or damage due to willful misconduct, cessation of work
whether total or partial, delay, damage due to faulty design,
rectification of defective material and/or workmanship inventory
losses etc.
 Motor 3rd Party Fleet Insurance
 Principal – Contractor
 Insured - Contractor
 Coverage
 in addition to the mandatory third-party cover also protects the car
owner from financial losses, caused by loss or damage or theft of the
vehicle, natural & man-made calamity
 any legal liability arising out of the use of your vehicle, towards third
parties resulting in injury/ death of a person or damage caused to the
property
 Valid upto issue of DLP
 Sum Insured
 On basis of Insured’s Declared Value (IDV) – manufacturer’s listed SP
minus depreciation
 Significant Exclusions
 Electrical & mechanical break-down, wear/tear of consumables, DUI,
driving w/o license, depreciation
 Contractors Plant & Machinery
Insurance
 Principal – Contractor
 Insured - Contractor
 Coverage
 covers loss or damage to construction equipment like cranes,
excavators etc. due to any accidental, external or malicious causes.
 Applicable even to hired plant
 Valid upto DLP
 Sum Insured
 Full replacement cost including freight, cost of erection and custom
duty, if any
 Significant Exclusions
 Electrical & mechanical break-down, wear/tear, rust, corrosion, willful
act, loss/damage by supplier,
 Workmen’s Compensation
Insurance
 Principal – Employer
 Insured - Contractor
 Coverage
 Staff & labours of the Insured
 Valid upto DLP
 Sum Insured
 On basis of total earnings
 Significant Exclusions
 War, civil war, terrorism, asbestos related diseases,
Local jurisdiction clause
 Professional Indemnity
 Principal –Architects, Consulting Engineers etc
 Insured - Architects, Consulting Engineers etc
 Coverage
 policy will indemnify the insured against claims for
compensation arising out of a breach of professional duty by
way of the negligent act, error or omission of the Insured
during the course of his profession.
 Valid upto 10 years
 Sum Insured
 Only those claims which are made against the insured during
the policy period are admissible under the policy
 Significant Exclusions
 Pre existing problems, deliberate acts, Collateral warranties,
consequential loss (loss of profit), war, pollution, terrorism,
 Public Liability Insurance
 Principal – Employer
 Insured – Employer
 Coverage
 covers the insured against legal liability towards claims to third party in respect
of accidental death/ bodily injury and / or property damage arising out of the
specified business of the insured and the legal cost/expenses incurred in
connection with the claim
 Valid upto issue of
 Sum Insured
 Depending on exposure, the insured has to fix two limits of indemnity – Any
One Accident (AOA) and Any One Year (AOY). The ratio between AOA and AOY
can be of 1:1, 1:2, 1:3 and 1:4
 Significant Exclusions
 Liability to own employees or contractor employees, Losses arising out of
deliberate, willful or intentional, Losses arising out of loss of pure financial
nature – such as loss of goodwill, loss of market, etc., Pollution, Consequential
loss
Thank you