Engineering Insurance provides economic safeguard to the risks encountered by the ongoing construction projects, installation projects, machines and equipment used in them . The nature of project decides which policy would be suitable.
The contractors can cover construction equipment such as bulldozers, cranes, excavators, drilling machine, road rollers, levellers etc. under the policy.
CPM Policy should be purchased by civil contractors and owners of Machinery against the damage to Machines and Third Party Liability Claim arising out of use of Machines.
This policy is mainly suitable for Contractors for covering their Machines against any peril leading to losses.
Below extensions can be taken under the policy by paying additional premium :
Floater Cover :
The policy is location specific, for covering machines on different sites, location wise list of machines should be declared. A machine can be covered at more than one project site by charging premium loading of 10%.
A client suppling construction equipment at various location, due to which there is Frequent change of machines Location. The crane against which the loss had occurred was covered under a different location whereas the loss location was different.
CPM being a location specific policy requires endorsement to be done for change in location which becomes a tedious work for frequent change. The Insurance company rejected the claim on the ground that the risk location was different.
The loss location was approx. 60Km away from risk location as mentioned in the policy. The Insurer was convinced that the Earthquake zone is same, more over the loss location is of the same client with same kind of project.
It was negotiated with the Insurer that for frequent change in location, client will give a monthly declaration of change in location.
A digging machine has travelled 3 Km. away from the site and overturned while operation.
CPM Policy being a location specific policy, the loss was denied by the Insurance company.
The case was presented to the Insurance Company that the machine had travelled 3 Km for work related to the same project and not for any other project.
CPM Policy is a location specific policy i.e. for a loss to be payable under the Insurance Policy, the loss to the machine should occur at a location under which it is cover. If the machine moves at different location then FLOATER CLAUSE should be opted, however under the FLOATER CLAUSE transit risk to the machine is not covered.
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