Erection All Risk (EAR)

    HomeErection All Risk (EAR)

Get in touch

marine-inc-1

Erection All Risk Insurance (EAR)

With advent of industrialization, insurance industry has also reinvented for newer challenges. There are various kind of risks embedded in every stage of the project for any/every industry, power plant, thermal power plant or a capacity addition in an existing unit. Time Again many losses have occurred due to various reasons resulting to project delay and making a dent in future growth. Erection All Risk is the correct cover in such cases and gives all risk cover for the project stage.

Coverage:

Erection All Risk policy is an exclusion-based policy for the project stage. The policy broadly covers the following.

Material Damage

  • It offers protection for plant and machinery, equipment, Civil work and other material work at the project site due to any reason other than the exclusions mentioned in the policy.

  • The policy covers losses due to fire, explosion, impact damage, crane failure and other natural disaster such as flood, earthquake, storm, volcano eruptions etc.

  • It also offers add-on covers such as express freight, additional custom duty, additional wages, related expenses etc.

  • Construction equipments used for the project can be covered under this policy by separately declaring the details of such equipments and value as per CPM policy coverage.
Third Party Liability

  • Covers liability arising due to fatal and non fatal bodily injury to any third party person other than insured own employees/ contract employees.

  • Liability arising due to damage of third-party property or property held in trust or under custody of the insured.

  • It also gives extension to cover cross liability wherein a claim by coinsured could also be defended.
Wider Covers

  • EAR policy is offered with variety of add-on covers such as design defects, escalation clause, removal of debris, extended maintenance cover, Loss minimization expenses, covers for offsite storage and fabrication.

  • Free add-on like 72 hrs clause, Co insurance clause, waiver of subrogation clause, 50:50 clause, public authority clause, put to use clause.

Major Exclusions

  • Loss or damage due to faulty design
  • Cost of rectification or correction of any error during erection not resulting in physical loss
  • Damage to files, drawings, accounts and bills
  • Cost of rectification or correction of any error during erection not resulting in physical loss
  • War and nuclear perils, consequential losses
  • Willful act/negligence, loss discovered at the time of taking inventory, and normal wear and tear.
  • Penalties for non fulfillment of contractual obligations, operational deficiencies.
  • Costs of any alterations, additions and/or improvements after a claim.
  • Third party obligations, contractual liabilities, and accidents caused by road, rail and water borne vehicles.
  • Terrorism Damage cover (add-on of Terrorism is available).

Sum Insured

It should represent the estimated completed value of the project.

Basis of loss settlement

  • If the damage can be repaired, then cost of repair necessary to restore the item, immediately before the loss will be paid. No depreciation will be deducted from the claim. In case sum insured is less than the amount required to be insured (estimated completed erected value) claim will be subject to under insurance. Also salvage will be adjusted in the claim.

  • In case of total loss, insurance company will pay the actual value of the item immediately before the loss. Under insurance and salvage will be applicable as above