Storage Cum Erection insurance, Erection all risk insurance for civil, construction and engineering project,

Erection All Risk Frequently Asked Questions (FAQ’s)

What is an Erection All Risk (EAR) Policy?

Erection All Risk Policy is also known as Storage Cum Erection insurance or SCE /EAR) is an insurance policy that is designed to protect the interests of Principals/EPC Contractors against damage or destruction of engineering projects where the value of Plant & Machinery comprises more than 50% of the total project cost. The protection extends to accidental damages to the project works, contractors plant & machinery employed in the project and also to damages and defects during the subsequent period of maintenance for which the EPC contractor is responsible.

What are the Perils that are typically covered under an EAR policy?

For the sake of better understanding, SCE/EAR normally covers the following:

Fire & Lightning
Accidental damages during erection (such as dropping or falling down of objects etc) as well as during testing
Flood, Storm, Tempest, Inundation, Water damage
Collapse, Collision, Impact
Theft & Burglary, Riot, Strikes & Malicious Damage (Excluding Terrorism)
Subsidence, Landslide and Rockslide, etc.

What are the Exclusions under a EAR policy?

General Exclusions

War, Invasion, Mutiny, Civil Commotion etc. (the burden of proving that the loss is not caused by an excepted peril falls upon the insured)
Damage by order of any government or municipality or local authority (the burden of proving that the loss is not caused by an excepted peril falls upon the insured)
Nuclear reaction, radioactive contamination
Willful act or Negligence of the insured
Cessation of work whether total or partial

What are some of the Add on covers that can be bought under a EAR policy?

The following Extensions / Add ons are also available on payment of additional premium:--

Storage Risks at fabricators premises
Clearance & Removal of Debris
Contractors Plant and Equipment not exceeding 5% of SCE/EAR Sum Insured
Third Party Liability and Cross Liability
Terrorism risks
Owners Surrounding Property
Escalation of Sum Insured
Additional Cost of Air Freight
Express Freight, Overtime wages and Holiday wages
Transit Insurance (including Customs Duty Cover) connected with SCE/EAR insurance
Additional Customs Duty
Maintenance Visits & Extended Maintenance Visits
Cover for “Hot Testing” of Catalyst in respect of Fertilizer and Chemical plants

Erection All Risk Frequently Asked Questions (FAQ’s)

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