If you are running a factory or a production business, you will very well know that your biggest assets are your machinery. A breakdown in your plant or machinery will affect the productivity of your business and production at an alarming rate. Hence it is essential that you protect and insure your plant and machinery, to recover the damages encountered and resume your business without any hindrance.
Plant and Machinery Insurance
Insuring your plant and machinery covers your business against any unforeseen damage to the equipment on your premises. The machine may encounter any sudden damage while moving, shifting, in operation or at rest, being assembled or dismantled; hence under these circumstances Plant and Machinery Insurance will be essential. The insurance will also cover your equipment against any unforeseen perils like theft, accident or stolen.
Plant and Machinery Insurance also has a provision in the cover to pay up for any loss of profit experienced due to the time lost while the equipment was under repair or replaced.
Who can take a Plant and Machinery Insurance?
The plant and machinery insurance can be taken by the owner of the machine, the contactor or user of the machinery, banks and the financial institutions who have interest in the machinery.
What are the add-ons under Plant and Machinery Insurance?
The Plant and Machinery Insurance can be extended to cover the following by paying additional premium:
- Express Freight
- Air freight
- Owner’s surrounding property
- Third party liability
- Removal and clearing of debris
- Additional customs duty
- Escalation and Dismantling
- Terrorism& Earthquake
Plant and Machinery Insurance does not cover
- Electrical or mechanical breakdown
- Gross negligence
- Boiler explosions
- Pre-existing defects
- Vehicles damaged on public roads
- Transit of machinery through waterborne vessels and crafts.
- Total and partial immersion in tidal waters
- Cost encountered for equipment alteration, improvement, modification, material changes etc.
- Loss or damage while in transit from one place to another
- Damage to exchangeable parts or tools
- Public liability while the plant & machinery are on public roads
- Any fault or defects in the plant & machinery existing at the beginning of the policy
- Damage due to wear and tear, corrosion, rust etc.
- War and other nuclear perils
Benefits of Plant and Machinery Insurance
Plant and Machinery constitute a substantial part in the business and its faulty functionality can hamper the business in every way. Hence insuring equipment against any unforeseen physical damage can be rightly covered under this insurance. The insurance providers will pay up for the damage incurred to the machinery while at rest or in operation in the premises. You may only cover selected machinery under this policy. Coverage for the machine is provided only at specific locations when you mention them initially in the agreement with the location.
Plant and machinery insurance is a standard cover for manufacturing workplaces. It is essential to cover the very tools you rely on to keep your product stock on track and profits flowing in.
It’s also important to cover the individuals working with such machinery and plants as these are the individuals that keep the process going. You can read about insuring your employees in several other articles on this website - search for group employee insurance and workmen insurance.
Insuring plants and machineries against unfore seen perils is in a way securing oneself. The many benefits cannot be ignored for the price factor. But does this insurance also covers loss of life and other damages incurred due to the machine?