CONTRACTORS ALL RISK (CAR) INSURANCE

CAR Insurance will cover risks associated with civil engineering works. It covers damage to insured property due to sudden, accidental and unforeseen causes.

In addition, it also covers liability for third party claims for injury and death or damage to third party property. It generally covers losses arising from Normal (Fire, Lightening, Burglary) and Act of God (Earthquake, Flood and Inundation, Landslide and subsidence, rockslide, Storm, Typhoon and Hurricane) risks. The CAR policy can also be extended to cover risks from Riot, Strike Damage, Malicious Damage and Terrorism risks.

The duration of cover of this policy is from the time of commencement of work or after the unloading of the first lot of materials at site whichever is earlier till the date specified in the policy schedule or the date of handing over of completed works to the principal whichever shall be earlier.

Key Aspects of the Scope of Cover:

• Material Damage (Section I): Covers physical loss or damage to permanent and temporary works, including materials, construction plant, and equipment, caused by fire, lightning, explosion, flood, storm, cyclone, landslide, theft, and malicious acts.
  
  
• Third-Party Liability (Section II): Protects against legal liability for accidental bodily injury or death to third parties, as well as damage to third-party property occurring during the performance of the contract.
  
  
• Optional Extensions: Often covers clearance of debris, professional fees, maintenance visits, surrounding property, and off-site storage.
  
  

Key Benefits of Contractors All Risks Insurance:

• Comprehensive Project Protection: Covers the entire project period including the maintenance period. This policy covers materials, plant and  machinery against unforeseen events like fire, flood, storm, and theft.
  
  
• Third-Party Liability Coverage: Protects against legal liability for bodily injury or property damage to third parties (e.g., subcontractors, passersby).
  
  
• Financial Safety Net: Mitigates heavy out-of-pocket expenses for repairs or replacements, protecting the contractor’s cash flow and business stability.
  
  
• Minimizes Delays: Ensures that if damage occurs, funds are available for swift repairs, keeping the project on schedule.
  
  
• Tailored Coverage: Policies can be customized for specific project needs, whether short-term or long-term developments.
  
  
• Contractual Compliance: Helps fulfill contractual obligations, as many construction contracts require this insurance to be in place. 
  
  
  

Key Buyers of Contractor’s All Risk

• Main Contractors: Manage day-to-day site operations and need protection against project damage and third-party liabilities.
  
  
• Subcontractors: Hired for specialized tasks; they are often covered under the main policy to ensure their work is protected.
  
  
• Property Developers & Owners: Commission the project and need to protect their investment from unforeseen losses.
  
  
• Civil Engineering Firms: Involved in infrastructure developments, roads, bridges, and large-scale projects.