Engineering Insurance

Course details

This course forms part of the Advanced Insurance covering CAR, EAR and other different aspects of Engineering Insurance.

Objectives

On completion of the course, participants will be able to:

• Describe the need and development of construction insurance
• Explain the basis of cover and associated clauses together with main exceptions and conditions of construction/erection policies
• Explain the basis of cover and associated clauses for plant and equipment, deterioration of stock, low voltage electronic equipment policies and demonstrate its main exceptions and conditions
• Discuss the need for latent defects policy, its scope of cover and its main clauses
• Apply risk assessment and underwriting considerations for engineering risks
• Examine the various consequential loss exposures of engineering insurance

Target Audience:

• Insurance employees, Brokers, Agents, Loss Adjusters, Employees who manage insurance in non-insurance companies

Course Structure

• The course is conducted using a combination of lectures, discussions and practical workshop sessions.

Program Contents:

• Contractors all risks, erection all risks, endorsements and warranties
• Construction contracts wording
• Machinery plants and equipment
• Advanced loss of profit (delay in start-up)
• Decennial insurance
• Machinery breakdown and machinery all risks
• Boilers explosion
• Computer all risks
• Deterioration of stocks
• Underwriting and rating of engineering risks
• Claims procedures
• Engineering reinsurance

Day Topics to be covered

Day 1  Introduction to engineering insurance

• Origin of engineering insurance
• Summary of main engineering insurance polices

Contractors All Risks (CAR) and Erection All Risks (EAR) policies.

• Cover in CAR and EAR
• Material damage section
• Third party liability
• CAR and EAR exclusions
• Material damage section exclusions
• Third party liability exclusions
• General exclusions

Day 2 

• Major CAR and EAR extensions and clauses
• Professional fees
• Maintenance period extension
• Expediting cost extension
• Removal of debris extension
• Faulty design extension
• Contractors plants and equipment
• Vibration, removal and weakening of support
• Cross liability
• Existing property
• 50/50 clause
• Temporary removal
• Inland transit
• Offsite storage
• Reinstatement of sum insured
• Hired plant cover
• Escalation clause

Day 3 

• Cover duration in CAR and EAR: Cover inception and expiry
• Risk assessment and claim handling in CAR and EAR policies
• Main underwriting factors under CAR and EAR
• Rating and premium calculation
• Claim handling: partial and total losses

Decennial Insurance.

• Potential insured, subject matter of insurance and sum
• Cover and policy period of decennial insurance
• Sources of inherent defects insurable under decennial insurance
• Importance and need for decennial insurance policy
• Main exclusions under decennial insurance policy
• Possible extensions of decennial insurance policy
• Major underwriting factors, rating and premium calculation
• Claims handling in decennial insurance

Day 4 

Machinery breakdown insurance

• Nature of cover and risks insurable
• Named insured under machinery breakdown insurance
• Main exclusions under machinery breakdown insurance
• Main underwriting factors for machinery breakdown insurance
• Basis of indemnity and claims handling
• The difference between machinery breakdown and CPE

Boiler explosion insurance.

• Definition of boilers
• Risks covered under boilers explosion insurance
• Major exclusions under boilers explosion insurance
• Possible extensions of boilers explosion insurance

Day 5 

Deterioration of stock insurance.

• Potential Insured and subject matter of insurance
• Scope of cover under deterioration of stock insurance
• Main exclusions under deterioration of stock insurance
• Important deterioration of stock insurance warranties
• Basis of indemnity and claims handling

Computer All Risk Insurance.

• Electrical Equipment/ Computer All Risks insurance
• Risks covered under Computer All Risks insurance
• Major exclusions under Computer All Risks insurance 
• Possible extensions of Computer All Risks insurance
• Main underwriting factors, rating and claims handling