Construction & Engineering Insurance
Insurance products provided under this section of cover/insurance are targeted at businesses and / or individuals who operate in the construction and related engineering industries whereby such businesses or individuals seek insurance cover to cover themselves against a wide range of associated risks.
Construction & Engineering Insurance
Insurance products provided under this section of cover/insurance are targeted at businesses and / or individuals who operate in the construction and related engineering industries whereby such businesses or individuals seek insurance cover to cover themselves against a wide range of associated risks.
Contractors all risks (CAR) Policy
Contract Works (Contractors All Risks) Insurance is intended to cover all types of building and civil engineering construction from residential to commercial and office infrastructure. The Contract governing the works will place the responsibility for the loss or damage with either the contractor or the employer and the CAR policy protects the owner and/or contractor for the physical loss or damage to the contract works that may threaten the afore- mentioned types of projects whilst under construction.
The Indemnity provided is based on an All Risks Basis in respect of the works and it includes all Materials forming part of and incorporated into the Completed Project
The policies cater for the following threats or perennial hazards:
- fire
- explosion
- Earthquake
- Flood, rainstorm, water
- Windstorm
- Subsidence, landslip
- Accidental damage
- Theft
Not having a reliable contracting all risk policy in place can cost you and your team both time and money.
Extensions of cover to Consider:
- Surrounding Property Damage
- Removal of Debris
- Beneficial Occupation
- Offsite Storage
- Fire Brigade Charges
- Professional Fees
- Additional claims preparation costs
Important factors to consider regarding CAR Insurance:
- make sure there is a legitimate contract in place between the contractor and the employer as Insurers will call for this at claim stage.
- Contract Value should be inclusive of VAT and Free Issue Material for which you are responsible for in terms of the contract.
- Make sure buildings of Non-Standard Construction i.e. Thatch are disclosed to Insurers as special consideration is given to these risk types by insurers and failure to Disclose this information could jeopardise any claims settlement.
- The Same can be said for Works involving Lateral Support as once again these risks require careful Consideration by insurers.
PLANT ALL RISKS
Plant all risks insurance is a product that is specifically designed to offer protection against loss or damage to propelled construction, plant /equipment / machinery on site such as excavators , TLBS , graders etc. it can also include non-self-propelled plant such as tools , generators , jack hammers and scaffolding.
The policy is ideal for owners of plant since it provides protection from all major risks that may arise which cause unforeseen losses and damage to their property.
The basis on which the items of plant are to be insured also needs to be considered as there are three ways that plant can be insured which are as follows:
- New Replacement value
- Market value
- Agreed value
How to Determine the basis on which items of plant are to be insured is as follows:
- New replacement value – requires input from manufacturers /suppliers
- Agreed value – requires a professional valuation and is likely to use same criteria used on market value basis. See below.
- Market value – the actual condition of the machine- hours operated- conditions under which the machine is operated- frequency of maintenance/ service- what is the market value willing to pay for the machine.
Not having a reliable contracting all risk policy in place can cost you and your team both time and money.
Extensions of cover to Consider:
- Surrounding Property Damage
- Removal of Debris
- Beneficial Occupation
- Offsite Storage
- Fire Brigade Charges
- Professional Fees
- Additional claims preparation costs
Below is a comprehensive break down Comparison as follows:
| NEW REPLACEMENT VALUE(NRV) | MARKET VALUE(MV) | AGREED VALUE(MV) | |
| Sum Insured | Equal to the cost of a new item of same kind and capacity | Equal to Market Value of the item | Equal to the value agreed between Insurer and Insured which is normally subject to a Professional Valuation being obtained at the Insureds Expense. |
| Additional Costs | Includes cost of Registration, Licensing fees, taxes & Delivery Charges | Includes Cost of Registration, Licensing fees, taxes and Delivery | |
| Average | Applies | Applies | Not Applicable |
| Basis of Settlement at claim stage | |||
| Partial Damage | New Parts for Old parts | Second Hand Parts-If not available then new Parts subject to Depreciation | Second Hand Parts-If not available then new Parts subject to Depreciation |
| Total Loss | Market Value Prior to the Loss | Market Value Prior to the Loss | Agreed Value |
| Pro’s / Cons’s | |||
| Pro’s | Easier to establish value from Suppliers and/or manufacturers for newer items | Total Loss settled as per agreed value | |
| Partial Loss – New for Old Parts however no betterment applied | Policy Not subject to Average | ||
| Easier to Establish write off | |||
| Total Loss within 12 Months settled on New Replacement Value | |||
| Con’s | Insured Values must be updated regularly at renewal | Insured Values must be updated regularly at renewal | Update Sum Insured at Renewal |
| Difficult to Establish NRV in respect of Older Plant | Difficult to Establish Market Value | Annual Valuation Required | |
| Exchange Rates | Exchange Rates | Possibility of under / Over Valuating | |
| Policy Subject to Average | Policy Subject to Average | Exchanges Rates |
Then the following extensions of cover are not automatically included in terms of a plant all risks policy however it should be included where applicable:
Site liability:
Site liability covers the contractor and / or plant owner from damages to third party property which are caused by his/her plant items whilst such items of plant are operational on the third-party site.
Road risk liability:
Items of plant that can be used whilst on public roads should have this extension of cover applicable as such cover protects the contractor / plant owner against damages caused to third party property.
Get a quote today and save on insurance!
Your content goes here. Edit or remove this text inline or in the module Content settings. You can also style every aspect of this content in the module
About Us
About SMB
Privacy Policy
Terms & Conditions
Resources
Products
Personal Insurance
Business Insurance
Investments
Wealth
Health
Contact Us
+2731 765 5075
info@smbinsurance.co.za
Address
17 Scotia Park, Nguni Way
Waterfall, Hillcrest,3610
