“Insurance of the constructions-assembly works against all risks and the contractor’s liability”
What are the CAR (Construction All Risks)/ EAR (Erection All Risks) insurance and who are they intended for?
The CAR/ EAR insurances are all risks type insurance and they are addressed to the construction firms, architects, designers, site managers, the technical experts in charge, distributors of construction materials, warehouses of construction materials, consultancy firms specialized in consultancy per types of activities.
As usual, the CAR/EAR type insurances are with optional regime, however, there are some exceptions where these types of insurances become compulsory, for instance in case of the accession of European funds or in the relation of the firms with the governmental authorities or when the Beneficiary expressly requests this policy in the Construction Agreement.
How is a CAR/ EAR type insurance taken out?
The insurance policy is drawn up based on the insurance request and/or the specific questionnaire request (in the case of airports, harbours, railways, bridges or other pieces of work of art) filled in by the insured. The Construction Agreement, Technical Brief, value quantitative work schedules, geological expert appraisal report, etc. can be added thereto, from case to case.
The CAR/ EAR insurances comprise 2 sections:
I. Material damages based on the construction agreement and the following can be insured:
- the contractual works, including materials and other goods appearing during the performance of the agreement
- constructions and equipment owned by the beneficiary
- the contractor’s materials necessary for the performance of the contracted works
- other expenses such as expenses for cleaning in case of damages, professional fees, architects, designers
- construction works: civil engineering, industrial, commercial, administrative, agricultural and/or the assembly ones (production/technological equipment, plants and machinery).
Types of construction works that can be insured:
- residential, office buildings, hotels, malls, parking lots (underground and above-ground)
- industrial buildings: production halls, commodity warehouses
- runways, asphalting works, constructions or reconditioning of railways, roads or motorways within or outside the cities
- bridges and passageways, tunnels, galleries
- sewerage works: placement of ducts and pipes, water distribution systems
- utility networks: water, sewerage, gas
- assemblies for the industry: production plants and equipment
II. Civil liability towards third parties (following the performed activity) comprising 2 branches:
- accidental bodily injuries or illnesses
- accidental loss of or damages to the property
For Section I, the insured amount is made up of the total value of the construction and assembly agreement, to which the following can also be added:
- total value of the materials and goods provided by the Beneficiary and which are going to be incorporated in the construction
- first sale value or remaining value of the constructions and equipment owned by the Beneficiary
- first sale value or remaining value of the equipment, machinery and machines owned by the Contractor and thereby used for the construction-assembly works
For Section II, the insured amount is chosen by the insured and established in accordance with the event and aggregate limit throughout the works, unless it is contractually imposed by the Beneficiary.
Additional expenses can also be insured:
- cleaning the remains in case of damages;
- professional fees (architects, consultants, experts);
- firefighters intervention;
- legal charges;
- on medical expert appraisals;
- on technical expert appraisals.
The loss, damage or liability directly or indirectly caused, produced or aggravated by the following are excluded:
- war, invasion, action of an external enemy, hostilities, irrespective of whether the war was declared or not, civil war, revolt, revolution, insurrection, strike, lockout, civil commotions, military power (dictatorship) or usurpation of power, group of malevolent people or people acting in relation to any political organization, seizure, conspiracy, confiscation, nationalization, destruction or damage by the order of any de jure or de facto government, or any political authority;
- nuclear reactions, nuclear radiations or radioactive contamination;
- intention or severe negligence of the Insured or of the representatives thereof;
- total or partial business interruption;
- pollution or contamination;
- risks originated from space, such as: falls of satellite, spaceships, meteorites;
- franchise set forth in the policy, for each event, that is going to be covered by the Insured;
- indirect damages of any kind, including penalties, following the non-compliance with the performance terms, other contractual obligations or loss of the agreement.
What do I do in case of damage?
In case of an insured event, a standardized procedure is followed for the solving of the respective situation, the client being supported by the insurer and the broker throughout this process.
Damages Call Center: 031 9660
Cătălin Chiriac, Deputy CEO Safety Broker: 0740.07.68.61