News

When it comes to engineering insurance, there are a large selection of policies available – but they are specialist insurances which is why only a few insurance companies (and brokers) now have the knowledge to underwrite the risks involved.

Here are some examples of the types of areas Engineering Insurance can embrace:

1) Deterioration of Stock insurance.   This type of insurance exists to cover the costs incurred if your commercial freezer or cold room breaks down and the food within it goes off (deteriorates).

2) Chimney insurance. The older brick built industrial chimneys have largely been replaced by more modern steel or aluminium chimneys but this type of insurance exists to cover the damage to the chimney from collapse or falling (include damage to own surrounding property) by any accidental cause.

3) Storage Tank insurance. This type of insurance covers bursting, impact, collapse and/or rupture of a storage tank and can be extended to cover the loss of its contents and damage to your own surrounding property. Please note it doesn’t cover gradual deterioration or rusting, something sudden has to happen to it for it to be covered. 

4) Hired in Plant insurance. When you hire an item of plant, not only are you liable for loss or damage to it, but under most hire conditions you’re also responsible for the continuing hire charges too. A hired-in plant insurance policy covers damage to whatever you’re hiring in and the consequential losses you’re liable for.

5) Machinery Movement insurance. You may be surprised to know most standard commercial insurance policies exclude loss/damage to plant whilst it’s being moved, irrespective of whether it’s being moved within a factory or across the world. This type of policy has therefore been designed to plug this gap and covers loss/damage to machinery whilst being moved and is often purchased by machinery manufacturers who design, build and install machinery, or machinery repairers who need to move the item of plant to fix it, or even factory owners who simply need to move an item of plant using their own staff and equipment.

6) Machinery Business Interruption insurance. This is a really valuable type of insurance which no one knows about! Let me give you a specific example. Many years ago, we insured a pallet manufacturing business who used a very special and expensive item of equipment to break existing pallets up so they could be remade. This piece of plant had been imported from Germany and had a 9 month lead time. If this machine broke down it would massively impact on our clients profitability, so we insured their loss of profits in the event of it breaking down.

7) Sudden and Unforeseen Damage. This is probably the most common of engineering insurances and it covers the costs of damage to your machinery and plant, including by breakdown. It’s usually subject to you having a regular and ongoing maintenance programme, which will need to be demonstrated in the event of a claim, but for businesses with expensive machinery this can be a really useful type of insurance as it  swaps the potential unknown costs of having to fund repairs for a known and budgeted insurance premium.

I hope this helps explain the mysteries of what Engineering Insurance can cover. If you want a chat about any of these types of insurance just get in touch with Prizm Solutions. The team at Prizm are specialist business insurance brokers so we deal with things like this every day!