What is Erection All Risks Insurance?

Erection All Risks

Erection All Risks insurance (EAR) is an insurance policy that would cover your company for its property damage and third-party liability in case of bodily injury or material damage claims during machinery erection.

This policy is very similar to Construction All Risk.

This policy covers the works to be executed in accordance with the contract, temporary works, materials, construction plant and equipment brought into the site and liabilities arising out of the performance of the contract.

EAR insurance coverage is used for a wide kind of projects such as power plant construction, Oil and gas facilities, Steel, aluminum, cement industries, Bottling plants, etc…

What is covered?

  • Erection as well as installation of electrical or mechanical plant and machinery wherever in the world
  • Losses that could occur during testing and commissioning before the hand-over
  • Damages during the contractual maintenance period
  • Movement or re-erection of machinery. Thus including testing phase, commissioning and maintenance of the installed machinery
  • Overseas contracts – subject to some territorial and environmental peril limitations
  • Defective design
  • Can be extended to Loss of Profits

What should you know?

Erection All Risks got lot of similarity with Construction All Risk Insurance but is far more technical to set-up.

Here are the main tips to keep in mind:

  • Premium is mainly based on Contract Value, then number of days (split between erection and testing/commissioning) and limit of liability.
  • Insurance generally got experienced engineers team to help them to assess the risk. However it takes time. Think about it in advance!
  • Erection All Risk can cover erection worldwide (not like Construction All Risk that are generally locally regulated)


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