1. Documents required for processing all engineering claims are as under:
a) Copy of the policy with full terms, conditions and warranties
b) Claim form
c) Survey report including –
i) Clear indication of the cause of loss
ii) Extent of damage and loss
iii) Establishment of liability
iv) Assessment of loss
v) Confirmation of compliance of policy terms, conditions and warranties
vi) Admissibility of the loss
d) Photographs }
e) Police Report } If necessary
f) Fire Brigade report }
Note : Items (e) and (f) may be waived where the survey report is clear and does not cause any doubt on the occurrence as well as extent of loss. Where occurrence of riot is in the public knowledge, production of Final Police Investigation Report and Fire Brigade report may be waived.
1.1 In case of theft losses it is necessary to collect a copy of the First information Report or proof of complaint lodged by the insured with the police, such as registered AD letter. Final investigation report may be waived depending on the merits of the case.
1.2 The steps involved in loss adjustment should be as under:
Gross loss assessed :-
a) Less: depreciation, if any,
b) Less: Salvage
c) Less: Under Insurance
d) Less: Excess
Net Claim Payable
POLICY TYPE-WISE ADDITIONAL REQUIREMENTS
2. MCE POLICIES:
Marine practice to be followed for settlement of Marine claims under MCE policies.
2.1 In case of mega projects, the services of an on-site representative / outside project monitoring agency could be retained to:
a) Monitor the progress of the project activity;
b) Receive report, on general conditions prevailing at site, from loss minimization point of view;
c) Co-ordinate with different authorities at site;
d) Collect required documents for claims already lodged to expedite disposal;
e) Conduct survey of losses falling within the self-survey limit.
f) Preliminary survey of losses.
2.2 Incidental expenses like supervision charges, storage charges may be considered to the extent they are included in the sum insured and actually incurred. When the replacement value is not ascertainable, the assessment can be based on the original invoice value plus escalation if provided in the policy. However, it may be left to the surveyor to arrive at the value.
2.3 The loss under various extensions like additional custom duty, airfreight, express freight, overtime wages, etc., are to be assessed separately. The expenses under these extensions will be available only when incurred by the insured. The liability under these extensions will be over and above the ones allowed under the standard policy provided the limit is not exhausted by earlier settled claims and/or claims reported but pending settlement.
2.4 If the claim is assessed both under the main policy and extensions like additional custom duty, express freight, overtime wages etc., the specified excess will be applied for each of these sections separately.
3. CONTRACTORS’ ALL RISK INSURANCE:
3.1 The surveyor shall confirm that the damage is not due to faulty design as the policy completely excludes loss due to faulty design unlike the erection policy where only a particular portion is excluded and resultant damage is paid.
3.2 Excess as specified is to be applied.
4. CONTRACTORS’ PLANT AND MACHINERY INSURANCE:
4.1 Being an Annual Policy, the validity of the policy at the time of occurrence should be verified.
4.2 Identification of the damaged equipment/item should be asked for to confirm coverage under the policy. This is necessary since selection of equipments for insurance is allowed.
4.3 The surveyor should confirm the accidental damage to the equipment.
4.4 For items fabricated by the contractor and replacement values not available, the surveyor should assess the loss on the basis of actual costs incurred by the insured.
5. MACHINERY INSURANCE:
i) Test reports of the damaged parts it deemed necessary by the surveyor and/or suggested by the insurers is to be submitted to the insurer/surveyor.
ii) Repairs/replacement should be confirmed by the surveyor.
5.1 The claim payable may include costs of dismantling, transportation to the repairer’s shop, repairs and re-transportation and re-erection and other incidental expenses. If damaged equipment being sent out is covered under a Marine Transit Policy, the cost of such insurance may also be reimbursed.
5.2 If repeated losses are reported on the same equipment, the underwriting office can take the help of an outside expert to ascertain the precise cause of repeated losses and suggest measures for avoidance/minimization of re-occurrence of breakdown/loss.
5.3 The exclusion of damage to Belts, Ropes, Chains, Rubber Tyres, Dyes, Moulds, etc is to be considered. As to the oil and other operating media in the transformer and equipment, these may be reimbursed only when, specifically covered under the policy.
5.4 The losses under the other extensions like additional custom duty, air freight, express freight, etc are to be assessed separately and the underwriting office should confirm the availability of additional sum insured specifically for such items of expenditure while recommending the claim for settlement. If the assessment involves additional expenses for repair/replacement, the surveyor should confirm that the expenses are reasonable.
6. BOILER EXPLOSION INSURANCE:
a) Copy of the certificate issued by inspectorate of Boilers (wherever applicable) for operation
b) Boiler inspection report on the occurrence
7. LOSS OF PROFITS INSURANCE:
7.1 A loss Profit claim is admissible only if loss or damage to Machinery or Boiler covered under corresponding policy is admissible.
7.2 As selection of equipment under the MLOP is allowed, the underwriting office should re-confirm the coverage of the equipment involved (Attention is drawn to the applicable time excess and surveyor is to be appointed in consultation with Regional Office/Head Office only in those cases where the interruption period is likely to exceed the time excess.) As the selection of the indemnity period is made depending upon the type of machinery, the underwriting office should make a policy copy available to the LOP surveyor and draw his attention to the indemnity period available against the affected item.
7.3 The material damage surveyor and the loss of profit surveyor should report on the steps initiated by them in helping the insured to reduce the period of indemnity by expediting repairs/replacements or adopting temporary measures. As a principle, the Company Engineer should be associated as far as possible along with the surveyor to minimise the loss under the Machinery Loss of Profit policy.
8. ELECTRONIC EQUIPMENT INSURANCE:
Since the selection of equipment is allowed, the underwriting office should confirm the existence of cover for the damaged item. There are various exclusions under this policy and it should be ensured that claim does not fall under any of the exclusions.
9. DETERIORATION OF STOCKS:
The surveyor should ensure that the insured takes following loss minimization measures
i) No fresh stock should be loaded in the cold storage chambers
ii) Cold storage doors should be sealed to maintain temperature and avoid temperature rise.
iii) If possible, the insured should be requested to shift stocks to some other running cold storage premises preferably in cool evening/ night period or by refrigerated vans.
iv) The Insured should be requested to carry out repairs to the refrigerator plant most expeditiously.
v) If there is no possibility of completing the repairs immediately, the insured should be advised to unload stocks from cold chamber for disposal in the local market as quickly as possible, and at the best available price in association with the surveyor/local authorities.
Following action is to be taken:
a) For a material damage reported under a Marine Cargo Policy or a Project policy, the HO should immediately take steps to monitor the facts of delay in repairs/replacement that may trigger a claim under the ALOP/Marine ALOP section.
b) Deputation of surveyors for ALOP claims should be only with the authorization of the HO (Tech).
All the general regulations as mentioned in the manual should be followed and surveyors with good knowledge of Civil Engineering should be utilized.