Erection All Risk Insurance (EAR)

Erection All Risk Insurance (EAR)

Policy Details:

1. India is a developing country and huge number of projects related to buildings, Industrial units like Cement plant, power plant or Automobile manufacturing unit are being carried out

2. We all are aware of the risk or hazards like fire, flood or accidental damage involved during the erection period or testing which can damage the construction material or machinery

3. It is a misconception among people that Plant or Machinery can be insured only after completion of Installation and testing.

4. NIC's Erection all risk policy protects the huge investment of Principal/ Contractors in these projects by paying for such kind of loss during erection or testing.

Highlights :

1. This policy offers comprehensive cover by covering risks which may arise during erection or testing period. It gives financial protection to the engineering contracts in the event of any accident.

2. The Erection All Risk policy is for erection and testing of Manufacturing units or individual machineries.

3. The policy also covers legal liability to third parties arising as a result of the project activity during the policy period

4. The EAR policy can be availed for the entire project period starting from arrival of material at site and till completion of testing and commissioning

5. Premium can be paid in instalments for projects of more than 12 months duration.

Covered :

All Risks (with certain exceptions) involved during storage, assembly, erection/construction, testing against:-

1. Fire, lightning, explosion/implosion, aircraft damage,
2. Flood, storm, landslide,
3. Theft, burglary, Riots Strikes and Malicious Damage,
4. Negligence, lack of skill, collision, impact, dropping, etc.
5. Electrical/Mechanical breakdown during installation or testing

By paying additional premium policy can be extended to cover additional perils/expenses which are mentioned below:

1. Earthquake
2. Terrorism
3. Clearance and removal of debris
4. Third party liability cover
5. Surrounding property of the insured
6. Escalation provision
7. Express freight, holiday and overtime rates of the wages -
8. Air freight
9. Additional custom duty
10. Construction machinery plants and equipment
11. Maintenance visits cover and extended maintenance cover

Exclusions :

1. War and nuclear perils
2. Normal wear and tear, gradual deterioration etc.
3. Damage due to faulty design, defective materials, bad workmanship, etc.
4. Consequential loss like loss of revenue, penalty for delay etc.
5. Inventory losses
6. Willful negligence,
7. loss of or damage to files, drawings, accounts, bills, currency, stamps, deeds, evidence of debt, notes, securities cheques, packing materials such as cases, boxes, crates

Claims Procedure :

In the event of any occurrence which might give rise to a claim under this Policy, the Insured shall-

1. immediately notify the Company in writing giving an indication as to the nature and extent of loss or damage;
2. take all steps to minimize the extent of the loss or damage
3. preserve the parts affected and make them available for inspection by a representative or Surveyor of the Company;
4. furnish all such information and documentary evidence as the Company may require
5. inform the police authorities in case of loss or damage due to theft or burglary