Constractor's all risk Insurance
Contractor's All Risk Insurance policy offers a comprehensive coverage against damage or loss with respect to a construction site, contract work, construction machinery, and/or equipment. This policy is designed for architects, construction engineers, and financers, as it contributes to reducing the overall risk and expenses of construction. Moreover, the contractor’s all risk policy offers sufficient financial protection to all the parties involved.
What is Covered?
- Material Damage: Loss, damage, or destruction of property incurred due to any cause other than those excluded in the policy are covered. Most of these policies pay for the losses or damage up to a certain amount as deemed fit by the client or mentioned in the terms of contract. However, the amount mentioned against every item does not ex-ceed the total sum insured.
- Third Party Liability:
- Legal liability related to accidental damage or loss caused to the property of third-person.
- Legal liability for non-fatal and fatal injuries caused to third-person (other than the own employees or workers of the insured) due to the construction of the property.
- Perils that are covered under Contractors All Risk Policy:
- Fire & Allied Perils
- Collapse & Damage
- Earthquake, Shock & Fire
- Storm, Flood, Cyclone and Tempest
- Water Damage
What is not covered?
- War and Nuclear Risks
- Partial Or Total Cessation of Work
- Wilful act or Wilful Negligence of the Insured
- Defective Material or Bad workmanship
- Contractual Liabilities
- Normal Maintenance
- Normal wear and tear
- Disappearance or shortage of materials on-site(inventory losses)
Add On Covers
Contractor's All Risk Insurance’s coverage may be extended to cover the interests of manufacturers, suppliers, contractors, and subcontractors. The policy can also be expanded to cover the following events:
- Additional custom duty
- Air freight
- Damage to surrounding property
- Debris removal
- Earthquake
- Escalation
- Loss due to breakage of glass
- Maintenance visits
Additionally, C.A.R policies may be designed to include losses in-curred when start-up is delayed because of another insured loss. For example, if a structure is damaged and is covered by C.A.R insurance, then the losses incurred as a result of a delay in opening the property while the damage is being repaired may also be covered. CAR policies can also be expanded to include a provision for escalation, cover acts of terrorism, and to cover excess third-party liability, among other less common scenarios.
Claim Process
Follow the below steps to file a claim for the contractor's all risk policy:
- Intimate your advisor and the insurance company immediately regarding the damage/loss in writing.
- The written notification must include the extent of damage caused to the property
- If the loss or damage is caused due to burglary or theft, then the insured should inform the police immediately
- The company sends its surveyor for the survey. Therefore, the insured should keep the damaged property/parts preserved for the same.
The insured now must submit the duly filled claim form with the following documents to the insurance company:
- The written statement of the claim having the details of loss or damage of the property.
- For machinery claims technical damage report.
- Delivery receipts or purchase invoice.
- A police report, if it is lodged. Repair or replacement estimate.
