Plant and Equipment Insurance

Plant and Equipment Insurance protects you against the risk of loss of equipment that is used while carrying out construction projects abroad.

General

When carrying out works abroad, you will often use expensive plant and equipment such as dredgers, bulldozers, cranes, welding and measuring equipment and accommodation for personnel. The risks of damage to plant and equipment, transportation or war risk are not covered by our Construction Projects Insurance policy. It is not always possible to cover these risks, unless at very high premiums. In such cases, Atradius can help you with a separate Plant and Equipment Insurance policy or an endorsement to the Construction Projects policy.

Risks insured

• Risk of damage while carrying out works due to political causes (such as war, hostilities or civil disturbances) or confiscation of plant and equipment as a consequence of a government measures
• Risk of damage after the work has been carried out or the risk of not being able to transport the plant and equipment to the country of destination as a consequence of a government prohibition.

The risk for Atradius will commence as soon as the plant and equipment arrives in the country in which the works are to be carried out. The risk will terminate as soon as the plant and equipment has arrived in the next country following completion of the works (in the previous country).

Covered percentage and uninsured portion

The covered percentage may vary, depending on the country risk policy, but does not exceed 98%. The minimum uninsured portion is therefore 2%. The uninsured portion may be transferred to third parties, but Atradius must give its written approval in advance. Atradius will only give its approval if the uninsured portion is transferred to parties that are involved in the project, such as subcontractors, suppliers and/or the financing bank. A claim for compensation arises once the waiting period of three months has expired.

Calculation of the claim

An inventory of plant and equipment, including the book value of and the depreciation rate used for each asset, will be appended to the Plant and Equipment Insurance policy. Atradius will reimburse the calculated loss based on the covered percentage.

The amount of the claim will be:

• In case of damage: repair costs up to a maximum of the initial value of each asset less depreciation.

• If assets are confiscated or could not be transported to the country of destination: the initial value of each asset less depreciation. The initial value will be the book value at the commencement of the risk.

Premium

The premium depends on the country in which the plant and material is used (varying from 0.17% to 1.45% per annum). The calculated premium is based on the book value provided by the contractor, which is applicable at the beginning of each year (initial value of each piece of plant and equipment less depreciation).