Contractor All Risks Insurance
Contractor All Risks Insurance
Contractor All Risks Insurance
1. OVERVIEW
The Contractors All Risks Insurance implements for all types of civil construction Projects. This insurance covers physical loss or damage to the Project, as well as third party liability related to work conducted on the contract site. All risks insurance covers physical damages to the works and site materials. The contract usually specifies the insurance requirements, for example, which risks must be insured against and the amount of insurance.
Reference: FIDIC OF May 2005 ISBN 2-88432-044-X Revision for the Clause 18 Insurance & Sub-Clauses
3.2 Loss or damage due to: Wear and tear, rust, or deterioration due to lack of use or obsolescence Defective design Cessation of work (Interruption of Works) Damage to tires unless the vehicle/equipment is damage at the same time. Loss of any property by disappearance or by shortages where such loss is revealed only by the making of an inventory or a periodic stocktaking. Consequential Loss or damage Loss or damage to any part of the permanent works which has been taken over or take into use (whichever is earlier) by the Employer or End User unless the loss or damage : Occurs during the Maintenance period from a cause arising before the property was taking over or taken into us or: Was cause by the insured in the course of fulfilling their obligations during the maintenance period in accordance with the contract Conditions
Reference: FIDIC OF May 2005 ISBN 2-88432-044-X Revision for the Clause 18 Insurance & Sub-Clauses
The collapse of a building across a city thoroughfare will need the urgent removal of debris not simply to nearby site, which is rarely available, but to a distance dumping placed which means heavy transport charges.
A figure can also be inserted in the policy schedule for Architect fees incurred in rebuilding, after a loss if these charges have not already been included in the sum insured on the works and temporary works. Such fees incurred however, in the preparation of a claim are not covered. Some projects need to have bulk stores of materials to the contractor and considerable values and which are not provided in the tender price, hence such value of materials must be declared. Generally speaking, any property other than the contract value should be declared under the policy with relevant values to be added to the contract price in order to be covered under the CAR policy such as , plant and Equipment,. Temporary buildings on site, scaffolding, tower cranes, excavators, hoist cranes, and alike.
Reference: FIDIC OF May 2005 ISBN 2-88432-044-X Revision for the Clause 18 Insurance & Sub-Clauses
18.1 FIDIC 2005 General Requirements For Insurances In this Clause, insuring Party means, for each type of insurance, the Party responsible for effecting and maintaining the insurance specified in the relevant Sub-Clause. Wherever the Contractor is the insuring Party, each insurance shall be effected with insurers and in terms approved by the Employer. These terms shall be consistent with any terms agreed by both Parties before the date of the Letter of Acceptance. This agreement of terms shall take precedence over the provisions of this Clause. Wherever the Employer is the insuring Party, each insurance shall be effected with insurers and in terms consistent with the details annexed to the Particular Conditions. If a policy is required to indemnify joint insured, the cover shall apply separately to each insured as though a separate policy had been issued for each of the joint insured. If a policy indemnifies additional joint insured, namely in addition to the insured specified in this Clause, (i) The Contractor shall act under the policy on behalf of these additional joint insured except that the Employer shall act for Employers Personnel, (ii) Additional joint insured shall not be entitled to receive payments directly from the insurer or to have any other direct dealings with the insurer, and (iii) The insuring Party shall require all additional joint insured to comply with the conditions Stipulated in the policy Each policy insuring against loss or damage shall provide for payments to be made in the currencies required to rectify the loss or damage. Payments received from insurers shall be used for the rectification of the loss or damage. The relevant insuring Party shall, within the respective periods stated in the Contract Data (calculated from the Commencement Date), submit to the other Party: (a) Evidence that the insurances described in this Clause have been effected, and (b) Copies of the policies for the insurances described in Sub-Clause 18.2 [Insurance for Works and Contractors Equipment] and Sub-Clause 18.3 [Insurance against Injury to Persons and Damage to Property] When each premium is paid, the insuring Party shall submit evidence of payment to the other Party. Whenever evidence or policies are submitted, the insuring Party shall also give notice to the Engineer. Each Party shall comply with the conditions stipulated in each of the insurance policies. The insuring Party shall keep the insurers informed of any relevant changes to the execution of the Works and ensure that insurance is maintained in accordance with this Clause.
Reference: FIDIC OF May 2005 ISBN 2-88432-044-X Revision for the Clause 18 Insurance & Sub-Clauses
Neither Party shall make any material alteration to the terms of any insurance without the Prior approval of the other Party; If an insurer makes (or attempts to make) any alteration, the Party first notified by the insurer shall promptly give notice to the other Party. If the insuring Party fails to effect and keep in force any of the insurances it is required to effect and maintain under the Contract, or fails to provide satisfactory evidence and copies of policies in accordance with this Sub-Clause, the other Party may (at its option and without prejudice to any other right or remedy) effect insurance for the relevant coverage and pay the premiums due. The insuring Party shall pay the amount of these premiums to the other Party, and the Contract Price shall be adjusted accordingly. Nothing in this Clause limits the obligations, liabilities or responsibilities of the Contractor or the Employer, under the other terms of the Contract or otherwise. Any amounts not insured or not recovered from the insurers shall be borne by the Contractor and/or the Employer in accordance with these obligations, liabilities, or responsibilities. However, if the insuring Party fails to effect and keep in force an insurance which is available and which it is required to effect and maintain under the Contract, and the other Party neither approves the omission nor effects insurance for the coverage relevant to this default, any moneys which should have been recoverable under this insurance shall be paid by the insuring Party. Payments by one Party to the other Party shall be subject to Sub-Clause 2.5 [Employers Claims] or Sub-Clause 20.1 [Contractors Claims], as applicable. The Contractor shall be entitled to place all insurance relating to the Contract (including, but not limited to the insurance referred to Clause 18) with insurers from any eligible source country
Reference: FIDIC OF May 2005 ISBN 2-88432-044-X Revision for the Clause 18 Insurance & Sub-Clauses