Construction Insurances Explained – Contractors Plant Insurance

C) Contractors Plant Insurance

Contractors Plant Insurance generally combines Material Damage, Road Risk Liability and Public Liability together under on policy in respect of the Contractors plant and Equipment.

Insurance can be in respect of single items of Contractor operated plant or large plant fleets whether these items of plant are involved in earth-moving, construction, cranage, agriculture, mining or similar activities.

A typical Contractors Plant Insurance would cover:

Broad CTP Gap Cover

Products Liability

Tool of Trade Cover

Vibration, Weakening or Removal of Supports

Accessories and Tools

Whereas there would normally be limits for such things as:

Dangerous goods carriage

Expediting expenses

Removal and recovery of plant

Removal of debris

Windscreen replacement

Machinery Breakdown and Business Interruption following Machinery Breakdown Insurance is also available. This insurance overs mechanical and electrical breakdown of plant and machinery, and the ensuing loss of production (cover which is often excluded from Fire and Property All Risks policies).

Policies can also cover loss to surrounding property damaged by breakdown, such as in the case of the explosion of equipment.  The cover is important for critical items of Contractors plant where limited back-up is available.

Contractors or tradesmen, often carry out works with the use of hired plant and equipment. Hiring contracts for plant and equipment usually make the hirer totally liable for any damage to the plant from the time the plant leaves the hirer premises until the time it is returned unless it can be shown that a loss is due to bad maintenance by the hirer. The Contractor should therefore arrange appropriate insurance under a hired plant insurance policy. This can sometimes be arranged on an annual basis with the premium based on a percentage of annual hiring charges or an existing policy for owned plant may be endorsed to cover any sums the Contractor becomes legally liable to pay under the plant hiring agreements. Hired plant insurance covers the Contractors legal liability under the terms of their hiring agreement to pay compensation for damage to on hire plant. This includes legal defence costs and continuing hire charges.