Engineering Covers Machinery Breakdown Insurance Introduction Breakdown of machinery can be a drain on the profits and can even

cause losses. Hence, it is advisable to seek protection against such breakdowns. Machinery breakdown insurance offers financial protection in case machinery suffers accidental, electrical breakdowns and breakdown requiring repairs and/or replacement, as the case may be. Equipments Covered Machinery breakdown insurance covers all types of industrial equipment like turbines, compressors, generators, transformers, rectifiers, electric motors, diesel engines, pumps, wind mills, etc. Coverage Under machinery breakdown insurance, the insured is covered under all kinds of accidental, electrical and mechanical breakdowns due to internal causes, external causes, operational deficiencies and human errors. Internal Causes Internal causes could be damage due to faulty material, defects in casting, faulty construction, overheating of parts, short-circuit, faulty erection, disruption in case of rotating bodies due to centrifugal forces, failure of operation of safety devices, etc. External Causes External causes include collision or impact from external objects or falling articles, failure of lifting machines or cranes, accidental falls during shifting of machinery within the premises or during overhauling. Operational Deficiencies Operational deficiencies include error of judgement, faulty operation, failure of safety devices, and failure of connected machinery, over-speeding, tearing apart on account of centrifugal forces, short circuit, electrical burn-outs, insulation failures and cracking or overheating of parts. Human Elements Human elements include carelessness, negligence of operators and sabotage or malicious acts. Premium Rates Electric Motors: up to 50hp 2% above 50hp 1.50%

Additional Covers a. Damage to foundation of machinery b. Express freight, holiday rates, overtime charges in the event of claim c. Third Party Liability (including bodily injury and property damage) d. Additional Customs Duty Risk not covered Loss of or damage to belts, ropes, chains, rubber tyres, dyes, moulds, blades, cutters, knives or exchangeable tools, engraved or impression cylinders or rolls, objects made of glass, porcelain, ceramics, all operating media e.g., lubricating oil, fuel, catalyst, refrigerator, endless conveyor belts, or wires, sieves, fabrics, heat resisting and anticorrosive lining and parts of similar nature, packing material, parts not made of metal (except insulating material) and non-metallic lining or coating of metal parts. Damage due to any cause for which the manufacturer and/or supplier is responsible. Overloading operations, experiments and tests requiring abnormal conditions. Gradually developing flaws, defects, cracks, etc. Wilful act or gross negligence of the insured or of his responsible representative. Defect existing at the time of taking insurance known to the insured but not known to the insurers. Any type of consequential loss.

The Cover The cover can be taken by the owner of the machinery or a party holding the machinery in trust or having financial interest in the said machinery, or Operation & Maintenance contractor. Sum Insured The sum insured of each item of machinery must be its present day new replacement value of similar machines including all incidental expenses like duties, taxes, excise, freight, insurance, landing, etc. i. CAR rates so worked out as per tariff provisions should be loaded by 25%. ii. Excess on glass items shall be 10% of aggregate sum insured of all glass items. Sub-contracts forming part of a project As regards sub-contracts forming part of a project, it is clarified that irrespective of whether the project value has been broken into various sections and orders/contracts are placed with different suppliers/contractors/sub-contractors or the insured carry out the work themselves departmentally, the insurance covers for all such sub-contracts are subject to general regulations.

Computation of Premium Premium shall be computed for the total period commencing from, i. Commencement of work, or ii. Date of arrival of the first consignment at the site of erection, whichever is earlier. Storage rate at fabricators premises/workshop This is an extension to CAR policy and can be covered: Rate 0.30 per mille per annum or part thereof Excess Rs. 1,500 per claim Additional rates for Earthquake (fire and shock) perils Irrespective of sum insured for CAR, the following additional rates are to be charged over the CAR rate for risks located in Earthquake Zones. Zones Zone I Zone II Zone III Zone IV Applicable rate (per mille) per annum 1.00 0.50 NIL NIL

Mid-term increase in sum insured during policy period In cases where the sum insured for CAR is required to be increased during the policy period, the premium should be collected on the additional sum insured at applicable CAR rates. It is not permissible to charge pro-rata premium on such increased sum insured. Mid-term increase in sum insured shall be affected only after the same has been recorded in the policy by the company before the occurrence of any claim. In such cases, no volume discount shall be applicable. Third Party Liability Cover The rate as applicable for CAR cover is to be charged for Third Party Liability Cover up to the following limits: A. For policies with sum insured up to Rs. 10 crores Any one person Any one accident During the entire period of CAR cover up to Rs. 1 crore

B. For policies with sum insured above Rs. 10 crores Any one person Any one accident During the entire period of CAR cover Rates for extension beyond policy period Normal Period 1 month or part thereof Exceeding one month but not exceeding 2 months Exceeding 2 months but not exceeding 3 months Exceeding 3 months but not exceeding 6 months Exceeding 6 months but not exceeding 9 months Exceeding 9 months but not exceeding 12 months Exceeding 12 months but not exceeding 15 months Exceeding 15 months but not exceeding 18 months Exceeding 18 months but not exceeding 21 months Exceeding 21 months but not exceeding 24 months Rate per mille 0.30 0.50 0.75 1.20 1.75 2.00 2.25 2.50 2.75 3.00 10% of the completely erected value or Rs. 10 crores, whichever is lower

Mid-term increase in sum insured during policy period In case the sum insured for CAR is required to be increased during the policy period, the premium should be collected on the additional sum insured at applicable CAR rates. It is not permissible to charge pro-rata premium on such increased sum insured. Mid-term increase in sum insured shall be effective only after recording the same in the policy by the company, before occurrence of any claim. In such cases, no Volume Discount shall be applicable.

Contractors Plant & Machinery Insurance General Regulations Jurisdiction This applies to all risks located in India. CPM policy can be issued covering equipment on anywhere in India basis with the following stipulations: a. Full description with identification number etc. of each and every equipment with valuation should be declared. b. Transit risks from site to site will be excluded. c. Earthquake extra from Zone I will be charged for the entire policy. Alternatively, Earthquake cover will be excluded from Zones I and II. d. Loading of 10% on the basic CPM rate shall be charged to cover Floater risk. MB risks in case of CPM equipments should not be covered either as an extension of CPM insurance policy or under a separate MB policy. Scope The cover shall be as per the standard policy form with respect to CPM insurance. The insurance of all types of CPM and equipments engaged for work at any specified location in India shall be subject to general regulations With respect to machinery/equipments, whether registered with RTO or not but engaged at the project site, the insured has an option either to select the motor/non-motor policy under Motor Tariff or CPM policy in the Engineering Department. Number of locations in a policy The policy schedule will necessarily include a list of all items of CPM and equipments, indicating separate value against each item. Any additions or deletions in these items during the policy period of 12 months can be done on short period basis. Policy schedule may also include more than one location with separate list of CPM and equipment at each location. Here also any addition or deletion of different locations of any items of CPM equipments may be done on short period basis. However, if the insurance is taken for a period shorter than 12 months, premium to be charged will be on the basis of short period scales provided hereafter. Similarly, the insurance taken for 12 months initially but cancelled mid-term, before completion of 12 months, will entitle refund on short period scale only. Shifting of CPM Transit Risks Many a times, items of CPM and equipments require to be shifted from one location to another location. The risk during transit from one location to another location is outside the purview of the policy. However, the risk during shifting of items of CPM and equipments in connection with

work at a project site from one point of the project site to another point in the same project site is deemed covered within the rates prescribed in Table 1 of Part 1 rate schedule. CPM under EAR/SCE/CAR Where the sum insured on CPM equipments under the project requiring EAR/SCE insurances not exceeding 5% of the sum insured for EAR/SCE or Rs.25 lakh, whichever is lower, such equipments must be rated under the CAR/EAR tariff. Where the sum insured on CPM equipments under the project requiring CAR insurances exceeds 5% of sum insured for CAR/EAR, that equipment must be rated under the CPM tariff. Loading of 10% on the CPM & Equipment rate shall be charged to cover Floater risks. Additional rates are applicable for Earthquake (fire and shock) perils, as per CAR/EAR tariff. CPM equipments mounted on floating vessel/craft: The CPM & Equipments mounted on floating vessel/craft and used for the purpose of contract work shall attract the rates prescribed in Table 1 of the rate schedule. However, the excess applicable for claims on such plant, machinery and equipments mounted on floating vessel/craft shall be the excess prescribed for claims arising out of AOG perils in Table III of Part 1 rate schedule. Short period scale of Premium rates Policy Period required Not exceeding 1 week Not exceeding 1 month Not exceeding 2 months Not exceeding 3 months Not exceeding 4 months Not exceeding 6 months Not exceeding 8 months Exceeding 8 months Service Tax @ 12.24% extra Third Party Liability A rate of 0.25% per annum should be charged and a total limit of indemnity selected to cover the third party liability up to the following limits: Any one person Any one accident During the policy period Rs.10 lakh Rs.25 lakh Rs.25 lakh Percentage of Annual Premium 10% 25% 35% 50% 60% 75% 85% Full Annual Premium

Third party liability insurance for limits in excess of those mentioned above should be underwritten in the Miscellaneous Department at the discretion of the Insurer. The excess applicable for third party liability property damage claims will be the highest of the excesses applicable to the machineries insured.

Application for Special Rating Application for special rating should be accompanied by an inspection report which must invariably contain the following information: i. Claim history for the last 5 years preceding expiry of policy period a. Total premium received b. Claims paid and outstanding ii. Any special remarks Mid-term increase in Sum Insured If the sum insured is increased during the currency of the policy: i. Short period scale of rates shall apply to increased amounts. ii. If the policy is renewed thereafter for 12 months for an amount not less than the increased sum insured, the difference of premium between short period scale of rates and pro-rata rate may be refunded.

Electronic Equipment Insurance Electronic equipments like computers, medical or bio-medical equipments, micro-processor, films, television studio equipments etc. can be covered under this policy. Scope The scope of this policy is any physical loss or damage due to the following perils: Location perils: fire, lightning, explosion, flood, storm, earthquake, etc. Breakdown: any electrical or mechanical breakdown. Faults: faulty design, faulty materials, faults in manufacturing/assembly erection. Moisture: effect of moisture. Carelessness: damage due to carelessness or negligent operations by the employee. Riot and Strike: riot and strike damage and malicious damage. Burglary: loss or damage due to theft or burglary/housebreaking. General exclusions Inherent Vice: wear and tear, loss due to defects known to the insured at the time of commencement of the policy. Manufacturers responsibility: the loss/damage for which the manufacturers/suppliers are responsible under guarantee. Wilful Act: due to any wilful act or wilful negligence of the insured or his representative(s). Cessation: cessation of work whether total or partial. Expected perils: war and war-like perils Interruption: loss or damage due to interruption caused by the failure of any gas, water or electricity service or supply Consequential loss: consequential loss of any kind, loss or damage to bulbs, valves, tubes, etc. Sum insured: the sum insured should be equal to the cost of replacement of the property by new property of the same kind and same capacity. Rate: depends on sum insured and maintenance. Excess: 5% of the claim amount subject to a minimum of Rs.2,500 Service Tax: 12.24%

Liability Insurance Covers Professional Indemnity Cover for Doctors and Medical Practitioners and Medical Establishments Today, globalization and liberalization have become the buzzword in Indian society, changing the economic and social life of citizens. These new concepts have also led to a new movement of consumerism in the country which have made consumers of both, products and services, more and more demanding due to greater awareness of their rights as well as the duties of service providers. In this regard, it is imperative that service providers such as Doctors and Medical Practitioners and Medical Establishments take utmost care in rendering professional services and have adequate cover and protection if they fail to do so. The Oriental Insurance Co. Ltd. has a special policy for Doctors and Medical Practitioners and Medical Establishments to take care of awards given against them by courts for breach of professional duty which results in financial loss or suffering to their clients. Insured: This policy covers the following: 1. Individual professional: Registered medical practitioners like general physician specialist, surgeon, diagnostic centre, lithotripsy, anaesthetist, radiologist, dentist, consultant physician. 2. Medical Establishments: hospitals, nursing home, which: a. has been registered with local authorities and is under the supervision of a registered and qualified medical practitioner, or b. i. should have at least 15 in-patient facility, ii. has a fully equipped operation theatre of its own, iii. has a fully qualified nursing staff in its employment round-the-clock, unless indicated to the contrary and additional premium paid, iv. has fully qualified doctors and the doctors should be in charge round the clock. 3. Employees: Employees of the firm, or something done in conduct of the business of the firm in a professional capacity. What is covered under the policy:Policy covers legal liability that the insured could incur due to civil suits filed by the clients for death or injury caused due to acts of omission or errors on the part of insured or his paid employees named in the proposal. The acts committed should be in the course of rendering professional services and during the period of insurance under the policy.

Sum Insured The policy provides for aggregate limit for any one accident and any one year which is chosen by the insured. However, the limit of indemnity granted for any one accident and any one year would be in the ratio of 1:1, 1:2, 1:3 and 1:4. The indemnity limit provided would take care of the following: - Compensation awarded to claimant - Claimants cost - Defence (legal) costs Geographical Scope Within India and jurisdiction applicable will be Indian Courts. Policy Period This means the period commencing from the effective date and hour as shown in the policy schedule and ending at midnight on the expiry date as shown in the policy schedule. Period of Insurance This means the period commencing from the retroactive date and terminating on the expiry date as shown in the policy schedule. Retroactive Date This is the date when the risk is first incepted under a claim made on the policy and thereafter the policy is renewed without a break in the period of cover. Any one accident For the purpose of this policy, where a series of losses are attributable directly or indirectly to the same cause relating to discharge of professional service, all such losses will be treated as one claim and indemnity would be granted as per any one accident limit. The date of loss in such cases would be treated as the date when the first claim was made in writing. Compulsory excess No compulsory excess is applicable in case of Doctor/Medical Practitioners. However, in case of Medical establishments, the compulsory excess is 0.25% of any limit subject to a minimum of Rs. 1,000 and a maximum of Rs.1 lakh.

Important Exclusions No liability shall attach to the company with respect to: i. any criminal act ii. services rendered while under the influence of intoxicants or narcotics iii. third party public liability iv. claims made against the insured arising from the performance of cosmetic plastic surgery, hair transplants, punch grafts, flap rotations and the life (hereinafter referred to as cosmesis) v. claims arising from any condition directly or indirectly caused by or associated with Human T-cell Lymphotropic Virus type III (HTLV-III) or Lymphadenopathy Associated Virus (LAV) or Acquired Immunodeficiency Syndrome (AIDS). Important Policy Conditions:1. Normally, all claims for compensation have to be legally established in courts of law. 2. The liability of the company applies only for those claims which have arisen during the period of insurance and have been first made in writing against the insured during the policy period. 3. Extended Claim Reporting Clause: in the event of non-renewal or cancellation of this policy either by the insurance company or by the insured, the insured is allowed a period of 90 days from the date of expiry for reporting any claim for an incident which had taken place during the period of insurance. 4. The insured shall give a written notice to the insurance company as soon as claim is made against him or is likely to be added against him. Every claim writ, suit or process and all documents relating to the event shall be forwarded to the insurance company immediately after these are received by the insured. 5. no admission offer, promise or payment shall be made or given by insured without the written consent of the insurance company. Underwriting Guidelines for Doctors and Medical Practitioners A. For General Physicians/General Practitioners: i. rate of Rs.0.5 per mille to be charged on proposed AOY limit plus 10% additional loading for dispensing in all the cases except where the concerned doctor clearly mentions about no dispensing in his question against question no. 18. Premium charged at this rate shall also cover the risk of the doctor in his individual capacity, if he is attached to other places. ii. further additional loading subject to a maximum of 25% to be applied, if the concerned doctor indicates the presence of other facilities to in his clinic, which is certainly not a Hospital or Nursing Home, against question no. 18.

iii. if the concerned doctor owns a Hospital or Nursing Home and is not attached to any other hospital or nursing home, then the subject falls under medical establishments-professional negligence errors and omissions insurance policy. The proposal form for this specific insurance should be filled up and rated accordingly. iv. in case the concerned doctor is attached to others in addition to having his own hospital or nursing home, then he wil have to take a professional indemnity insurance policy for doctors and medical practitioners for covering the risk in his individual capacity for the placers, where he is attached to, and also professional negligence errors and omissions insurance policy for his hospital or nursing home. Both these policies shall have to be taken for the purpose of complete risk coverage.