Новости ДедалИнфо

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07.11.2007

Engineering insurance

Engineering insurance is the insurance industry which uses as a collective term to describe various types of policies for the protection of construction works, as well as the erection and operation of machinery. There are following classes of insurance: Contractor‘s All Risks (CAR), Erection All Risks (EAR), CPM Contractors' Plant and Machinery Insurance(CPM), Electronic Equipment (EE), Inherent Defects, Machinery Breakdown, Boiler Explosion and other. Policy forms are either standard or tailor-made. The main problem lies in interpreting the cover: all possible risks – even unknown ones – are insured unless explicitly excluded. Loss adjustment may cause headaches, in particular in connection with the field of business income protection. The policies CAR, EAR, CPM in the countries of CIS have received the greatest distribution and refer to as Construction and Erection Insurance.

In Ukraine, despite of building boom, Construction and Erection Insurance has not found wide application yet. The main reason for this  is too low insurance culture of our citizens, as a whole, and building organizations, in particular, and mentality of the population: "while the fried cock not peck" (the English variant of a saying: “The cow knows not what her tail is worth until she has lost it”). Unfortunately, in Ukraine there are not many insurance companies specializing on engineering and building insurance and having a basic experience in this direction and obligatory contracts of reinsurance. Insufficient level of professionalism many insurers, shortage of the statistical data, not possession of methodology in these difficult kinds of insurance remain one of major problems of this sector of the insurance market in Ukraine, it is especial in regions. First of all interests of the building companies suffer from it.

In Construction and Erection Insurance risks can be huge, and the insurance premiums, as a rule, are insignificant. For this reason many Ukrainian insurance companies try not to work in this market. Besides many construction risks are insured by captive insurance companies and do not act on the free market. Construction and Erection Insurance develops mainly by the large foreign building companies, for which  insurance is natural.

Many insurance companies continue to insure Construction and Erection works from usual property risk: fire, acts of nature and illegal actions of the third persons. Although there are a plenty specific risks in spite of classical ones. It is almost impossible to list all these risks. Because of  inadequate insurance technologies and formulations of the insurance contract quite often arise problem of damages settlement.

The insurance broker "Dedal" works in the insurance market more than 14 years, offering the professional approach to risk - management to each concrete building company. We will be glad to offer our  professional experience in the field of insurance and reinsurance of building risks of the Ukrainian companies, and also insurance of construction machinery transmitted in lease.

 

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