What Does Plant and Machinery Insurance Cover

Introduction

Almost every business, contractor, and project manager solely depends on heavy machinery, equipment, and plants to complete their operations without disruptions. Several commonly involved pieces of machinery and equipment in such projects include cranes, bulldozers, trucks, drilling machines, mining equipment, crushing belts, conveyors, and more.

Due to the increasing demand for these machines to finish the project within the stipulated timeframe, companies in the (United Arab Emirates) UAE tend to make significant investments in equipment and plants, accelerating their business workflow and operations. However, these machines are vulnerable to damage due to the nature of work and site conditions, causing project delays and financial setbacks to the businesses.

Plant and machinery insurance policies provide valuable coverage by covering damages and mitigating potential risks. The following blog provides a detailed description of what plant and machinery insurance covers to safeguard businesses during unexpected events or accidents.

Major Inclusions of Plant and Machinery Insurance

Physical Loss: The cracking in the casing, supporting structure, or framework due to falling or collision of machines and equipment can cause disruptions to core business operations. Hence, a plant and machinery insurance policy covers the damages or losses that occur by various types of physical loss, such as complete breakage of equipment components due to friction with other objects and materials. The insurance also covers the holes and penetrations from the impacts of foreign objects, failure of electrical circuits of machines due to floods and water leaks, and damage to internal components, such as gears, bearings, and circuits due to falling debris.

Transportation Risks: The plant and machinery insurance policy typically covers the damages and dismantles that occur due to the loading and unloading of machines and equipment during transportation. These include:

• A crane falling on a machine during loading
• Lifting tools or instruments topples on equipment
• Failure of the machine by losing straps during transit
• Equipment getting damaged while unloading from the vehicle
• Dents and scratches on the body parts of the machines and more

The plant and machinery insurance policy covers the repair and replacement costs by providing financial compensation to the damaged machines and equipment.

Accidental Damage: Plant and machinery insurance covers damages or losses caused to machines and equipment by sudden, unexpected, or unintentional events. The most common forms of accidental damage to plants and machinery are caused by various factors, such as friction on the surface of machines during operation, faulty wiring in electric motors, conveyor belts, high-intensity discharge (HID) lamps, falling heavy objects, and accidental collisions with other vehicles and structures. These events can cause equipment failure or malfunction, explosions, short circuits, and threats to safety.

Theft or Burglary: Insurers typically cover the potential loss and risks to plants and machinery caused by theft and burglary. These unexpected events can happen even on holidays at the storage site, project location, or workplace. Plant and machinery insurance policies provide coverage for the complete loss of equipment by compensating for its current market value—specific parts and components crucial for functioning are stolen. It also includes coverage for property damage during the event of theft and burglary, such as breaking gates, fences, and locks, and financial losses due to project delays caused by stolen machines and instruments.

Third-Party Liability: Plant and machinery insurance covers compensation and financial aid for damages caused by equipment failure to surrounding property and equipment that the company does not own. The insurers are also responsible for providing medical expenses for injuries caused by machinery breakdowns to workers, passersby, and residents in the neighbourhood. The policy also covers legal fees, court costs, and settlement in the case of lawsuits and judicial repercussions.

Natural Calamities: Insurance service providers are liable for covering the damage or potential loss of machinery, equipment, and plants caused by natural disasters such as earthquakes, tsunamis, landslides, floods, storms, and lightning strikes. The policy offers repair and replacement costs for equipment destruction, failure, and malfunction, reducing the disruptions to business workflow caused during humanitarian crises.

CoverB—Your Ultimate Choice to Get Plant and Machinery Insurance

Choosing the right insurance service provider in the UAE is as essential as selecting the policy to safeguard your plant and machinery. CoverB is an optimal choice for businesses looking for the appropriate plant and machinery insurance to protect their valuable equipment, tools, instruments, and machines, ensuring faster project completion.

With years of experience and industry knowledge, our insurers carefully assess and evaluate the risks to your plant and machinery at the project site. This enables them to meticulously customise a policy that perfectly aligns with your specific business needs and goals.

Conclusion:

Understanding the inclusions of plant and machinery insurance policies is crucial for taking necessary steps to protect your equipment, machines, properties, and valuable assets from accidental damage and losses. Knowing what is covered in your policies provides clarity on protection, avoids assumptions, and streamlines claim processing.