Engineering Policies

A bond is a guarantee provided by the insurer to anyone who has entered into a contract with another - called the employer - for the purpose of executing a job. The insurer by this attests to the fact that such a person will be faithful in executing the job spelt out in the contract agreement otherwise the insurer will be held responsible for any default.

The followings are the different types of bonds:

• BID BOND

  This is issued in respect of tenders for contracts. The insurer guarantees that, in case the contractor fails to take up the contract after a successful tender, the insurer will pay whatever charges made against the contractor by the employer consequent upon the decline in taking up the contract.

• ADVANCE PAYMENT BOND

  This guarantees the faithful utilization of funds mobilised for contractors to commence a contract.

• PERFORMANCE BOND

  This is usually a guarantee for the total amount of the contract. The insurer is held liable to the employer up to the tune of the contractor's default.

• CUSTOMS / EXCISE BOND

  This guarantees that duties are paid on goods exported or imported before they are cleared by custom agents.

• INDEMNITY OF SHARE CERTIFICATE

  This guarantees the value of shares certificate lost in transit to the owner of the certificate.

• COUNTER INDEMNITY

  This guarantees the surety upon which a contractor is guaranteed to execute a contract.

This indemnifies the insured against unforeseen physical loss or damage to the property insured consequent upon any cause except those specifically excluded from the policy, up to the sum insured, upon the payment of the agreed premium.

Cover can be extended to include third party liabilities incurred from the contractor's operations.

This policy is required by engineers who engage themselves in the installation of equipment and machinery or other constructions requiring professional knowledge.

Under this policy, the insurer indemnifies the insured against any unforeseen physical loss, damage or destruction of the property in the process of erection with the exception of the perils specifically excluded by the policy subject to the payment of the required premium.

This policy can be extended to include the insured legal liability to third parties arising from the job.

This provides cover against loss or damage resulting from unforeseen and sudden damage to any machinery insured from any cause not excluded from the policy:

• Whilst the machinery is at rest or at work.
• While being dismantled for the purpose of cleaning, inspection and overhauling or removal to another position or in the course of these operations or subsequent re-erection within the premises specified in the schedule of the machinery.
• Liability to third parties as determined by the insured.

The cover is subject to the payment of the prerequisite premium.

MACHINERY CONSEQUENTIAL LOSS

This provides cover to the insured subject to the payment of the required premium in respect of losses suffered as a result of accidental interruption or interference of the operation of the machinery covered under the following policy titles:

• On gross profit
• Salaries and wages
• On rent
• On auditors fees

This policy covers the insured if the boiler / plant insured suffers any damage directly consequent upon and solely due to explosion or collapse in the performance of its proper function at the location specified in the schedule of the policy.

Indemnity is provided on the following basis:

• Damage to the boiler / plant.
• Liability for damage to property of third parties / death and bodily injury to third parties.

The cover is subject to the payment of the appropriate premium.

• MATERIAL DAMAGE

  This policy provides cover against any unforeseen or accidental damage or loss from any cause other than those specifically excluded necessitating repair or replacement in addition to the cost of clearance of debris from and cleaning of the insured property damaged by any insured peril as detailed below:

  • Incorrect operation, negligent or malicious acts of employees or third parties.
  • Burglary, theft, robbery and the events related to them.
  • Faulty design and material.
  • Short circuit, excessive voltage, induction.
  • Fire, lightning and explosion of all kinds (including the damage caused by fire-fighting and rescue operations)
  • Scorching and charring, smoke, soot.
  • Forces of nature such as storm, flood, hail, landslide except seismic perils.
  • Any influence of water and moisture and corrosion resulting from them.
  • Any other accident not hereinafter excluded.

• LOSS OF DATA

  The policy indemnifies the insured in respect of cost of regeneration of data consequent upon the damage to the data.

• INCREASED COST OF WORKING

  The policy indemnifies the insured in respect of all additional cost incurred to ensure continued data processing on substitute equipment consequent upon the damage to the data.

This provides cover against any unforeseen and sudden physical loss or damage from any cause other than those specifically excluded in a manner necessitating repair or replacement.