Contractors All Risks
The basic concept is to offer comprehensive and adequate protection against loss or damage in respect of the contract works, construction of plant and equipment and/or construction machinery,as well as against third party claims in respect of property damage or bodily injury arising in connection with the execution of a building project.
A CARpolicy may be concluded by the principal or by the contractors engaged in a project including all subcontractors. CAR insurance provides an “all risks” cover – every hazard is covered which is not specifically excluded. This means that almost any sudden and unforeseen loss or damage occurring during the period of insurance to the property insured on the building site will be indemnified. The most important causes of losses indemnifiable under CAR insurance are:
- Fire, lightning, explosion
- Flood, inundation
- Windstorm of any kind
- Theft, burglary
- Bad workmanship, lack of skill, negligence, malicious acts or human error
The cover provided by CAR insurance is subject only to a few obvious exclusions which the international insurance market usually applies. The exclusions are named in the policy and essentially comprise:
- Loss or damage due to war or warlike operations, civil commotion of any kind as well as acts on the part of strikers and locked-out persons.
- Loss or damage due to willful acts or willful negligence of the Insured or of his representatives.
- Loss or damage due to nuclear radiation or radioactive contamination.
- Consequential loss of any kind or description whatsoever such as claims from penalties, losses due to delay, loss of contract
- Loss or damage due to mechanical and/or electrical breakdown or derangement of construction machinery, plant and equipment (consequential loss of insured property being included)
- Loss or damage due to faulty design
- The cost of replacement, repair or rectification of any deficiencies in the contract works, e.g. use of defective or inadequate material (however loss of or damage to correctly executed items resulting from the inadequacy of other items of the contract works is generally covered under CAR insurance.
The cover attaches as from the commencement of work, or after the items entered in the schedule of the policy have been unloaded at the site, and terminates when the completed structure or any completed party thereof is taken over or put into service. The insurer’s liability for construction machinery and construction plant and equipment commences from their unloading at the site and expires on their removal therefrom.
In addition, it is possible to extend the period of cover to include a maintenance period.
Maintenance Visits Cover
The Insurer’s liability during the maintenance period is limited to loss or damage caused by the Insured in the course of the operations carried out for the purpose of complying with the obligations under the maintenance provisions of the contract.
Extended Maintenance cover
In addition to the protection provided under Maintenance Visits coverage, this type of cover also includes loss or damage caused during the construction period
Accidental loss of or damage to third party property happening in connection with the business and occurring within geographical limits described and during the period of insurance.
Employer’s Liability Cover
This covers employees against death, injury or sickness sustained directly
Carriers Legal Liability
This policy covers claims arising from:
• Accidental bodily injury including death to third parties