• What is Erection All Risk (EAR) insurance?

    EAR insurance is designed to cover the risk of loss arising out of the erection and installation of machinery, plant and steel structures, including physical damage to the contract works, equipment and machinery, and liability for third-party bodily injury (BI) or property damage (PD) arising out of these operations.

    Who can take EAR Insurance?

    Covered parties include; The General contractor,
    Firms commissioned to carry out the work, including subcontractors
    In some cases, the Suppliers and manufacturers of equipment
    The Parties financing the project

    What does Erection All Risks Insurance cover?

    This is an ‘All Risk’ policy covering sudden and unforeseen loss or physical damage to projects under erection and third party liability for accidental bodily injury in connection with the performance of the contract resulting during the course of Erection, Storage, and Testing, Commissioning etc out of any cause or peril not specifically excluded under the policy.
    Broadly EAR policy covers the following risks / perils:-
    Fire, lightning, explosion, aircraft damage Riot, strike, malicious act Flood, inundation, storm, cyclone and allied perils Landslide, subsidence and rockslide Burglary and theft Faults in erection Human errors Short circuiting, arcing, excess voltage Electrical and mechanical breakdown Collapse, damage due to foreign object, impact damage

    What does Erection All Risks Insurance not cover?

    Some of the general exclusions under EAR policy include:

    1. Loss or damage due to faulty design, defective material of casting and/or bad workmanship
    2. Manufacturing defects
    3. Loss or damage due to willful act or willful negligence
    4. Consequential losses, contractual liabilities
    5. Loss or damage due to war or warlike operations
    6. Loss or damage due to nuclear reaction, nuclear radiation or radioactive contamination
    7. Losses due to normal wear and tear, gradual deterioration
    8. Cessation of work
    9. Inventory losses

    What are the extensions available?

    On payment of additional premium, EAR insurance can be extended to cover the following:

    1. Cross liability
    2. Cost of removal of debris
    3. Express freight, overtime charges
    4. Air freight
    5. Additional customs duty
    6. Escalation
    7. Owner’s surrounding property
    8. Storage risk at fabricator’s premises
    9. Maintenance cover
    10. Terrorism