“Why and What of Contractor’s All

Risks Insurances"

AN EIMS PRESENTATION

Cas Hansa

2011

• “A 'thumbnail' view of the scope of a typical Contractor's All Risks (projects works) insurance policy (via a gallery of photos).

• A 'tour' of the Eskom Insurance internet/website - a knowledge centre - of the project-works insurance programmes for Dx, Tx and Gx.

• Necessary steps to follow in the event of loss or damage experiences on site or with shipment of goods/materials.

Synopsis

Introduction to Contractor’s All

Risk (CAR) Insurance Source: The Council on Tall Buildings and Urban Habitat

Projects Insurable under a

Contractor’s All Risk Policy

Bridges (storm event)

Projects Insurable under a

Contractor’s All Risk Policy

Tunnels (flood, collapse?)

Projects Insurable under

Contractors’ All Risk Policy

Pipelines (dewater; debris removal)

Projects Insurable under a

Contractor’s All Risk Policy

Paper Mill (test & commission right at the end)

www.dcsc.tudelft.nl/.../paper-mill-a1.jpg

Projects Insurable under a

Contractor’s All Risk Policy

Wind Turbines (collapse; mechanical; lightning)

www.dcsc.tudelft.nl/.../paper-mill-a1.jpg

Projects Insurable under a

Contractor’s All Risk Policy

Semiconductor Plants (workmanship; fires?)

Source: Samsung Electronics Co., South Korea

Projects Insurable under a

Contractor’s All Risk Policy

Gas Turbine (dropping; blade damage?)

Source: Siemens.com

Projects Insurable under a

Contractor’s All Risk Policy

Complete Thermal Power Plants

Projects Insurable under a

Contractor’s All Risk Policy

Chemical Plants (explosions)

Exposures

Contractor accidentally burst

Municipal (3rd Party) water main

Accidental Damage to the

Works and to Third Party

Property (the Municipal

main/pipe and the

neighbour’s property

Exposures

Third Party Liability damage to

Building and Boundary Wall

3rd Party

Church

Premises

damaged

Contractor’s

Equipment

New

Shopping

Complex

works area

Exposures

Concrete spillage damage to

(Third Party Property)

Exposures

Concrete spillage damage to

Third Party Property

Exposures

Consequential Loss vs a TPL

Deterioration of Stock Loss

Note: The

(CAR) Works

policy does

NOT cover

consequential

loss such as

loss of profits,

penalties, time

delays, loss of

income, etc.

However, if

‘legally liable’

the TPL

Section of the

CAR Policy

will respond

to loss or

damage

caused to

Third Party

Property, eg

negligent,

accidental

damage to a

Power Cable

Mr Noah, don’t you think the prophesies of a

global climate change are a bit exaggerated?

Exposures: ‘Acts of God’

Exposures

‘SASRIA’: Strike, Riot, Civil Commotion and Terrorism

A Local Community damaged a sports facility being built.

Indications were they were unhappy with the ‘low cost’ structures

built versus the ‘high standard’ promises made to them.

Importance of social compacts being well publicised and fully

approved by all key community members!

Exposures

Theft of Materials (especially copper!)

Exposures

Theft of Materials

Exposures

Fire Damage to Equipment

[or SASRIA damage?]

Equipment: The responsibility of the

Contractor-Owner. These items must be

insured so that in the event of loss/damage

they can be urgently repaired or replaced.

Projects Insurable under a

Contractor’s All Risk Policy

Works; Surrounding Property; Employer’s

Property; Third Party Liability; Equipment.

Internet Repository

http://www.eskom.co.za/c/101/insurance-policies-procedures/

Policies and Procedures:

[Generally Tx Projects < than R500million, and

Gx Projects < than R350million]

Format A Project Works (Annual Contractor's All Risks)

Master Insurance Policy

SASRIA Master Policy

Format A Marine Insurance Policy

Marine Policies and Procedures

Format A Works Insurances Guidance Schedule

Internet Repository Cont’d.

http://www.eskom.co.za/c/101/insurance-policies-procedures/

Similarly, Policies and Procedures:

[For any contract related to the Projects Listed for

the so-called ‘Floater’ Insurance Programme]

Similarly, Policies and Procedures:

[Generally all Dx Projects < than R500million]

Similarly, Policies and

Procedures. [Contact EIMS for details]

Internet Repository Cont’d.

http://www.eskom.co.za/c/101/insurance-policies-procedures/

Claims Handling Policies and Procedures:

General Claims-Handling Flowchart

Marine-Specific Claims Handling Procedures

Works Damage Claim Form

Third Party Liability Claim Form

SASRIA Claim Form

Internet Repository Cont’d.

http://www.eskom.co.za/c/101/insurance-policies-procedures/

Professional Services Contract Guidance Notes

Contract Works Engineering Insurance Training Manual

Marine Insurance Training Manual

General Insurance Guidance Notes

Eskom Insurance Management Services (EIMS) Contact

Details

Internet Repository Cont’d. Claims Handling Process Chart

JOH-ESK002-20050922-JvW-P2

29

Thank

You