Machinery breakdown policy is an insurance cover that reimburses the insured of any losses that he has incurred due to the loss or damage of the machinery that he owns. The cause of damage may be accidental, electrical or even mechanical. Only the cost of the replacement or repairs if any can be covered.
More about this Policy
Any person or legal entity having a financial interest on the machinery can opt for the coverage. And any type of machinery like transformers, generators, pumps can be covered. Since the purpose of insurance is to make good the loss and not to derive any profit out of the transaction, it is to be noted that the sum assured should be the present market value of a similar new machine including statutory expenses like taxes, excise, handling charges, freight, etc. If the sum assured is less than the price mentioned above, the claim that will be settled will be proportional.
Risks covered under Machinery Breakdown Policy
- Electrical short circuiting
- Fire due to insulation failure or over voltage
- Failure due to malfunctioning of allied machineries.
- Faulty parts of the machine.
- Damage caused due to error in judgment.
- Accidental entry of foreign particles.
Recommended Read : New India Assurance Company - Machine Breakdown Policy
