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Contractor's All Risk Insurance Policy

Contractor's All Risk Insurance offers comprehensive and adequate protection against loss or damage in respect of contract works, construction plant and equipment and/ or construction machinery, as well as third party claims in respect of property damage or bodily injury arising in connection with the execution of a civil engineering project. This policy is extremely useful for consulting engineers, architects and financiers because it contributes to reducing the overall construction expenses and at the same time offers efficient financial protection for all parties concerned.


Contractor's All Risk provides 'all risk' cover unless the hazard is specifically excluded.

The policy comprises of 2 Sections:

  • Section I-Material Damage-covering physical loss, damage or destruction of the property insured by any cause, other than those specifically excluded in the policy.
  • Section II-Third Party Liability-covering the legal liability falling on the insured contractor as a result of bodily injury or property damage belonging to a third party.

Who can take the policy?

The policy can be taken by the principal, contractor or sub contractor, jointly or separately.

Major Exclusions

The main exclusions under Section I for which no claim is payable, are loss or damage due to:

  • faulty design
  • rectification of aesthetic defects of structure not relating to any physical loss or damage to the structure due to any accident, or of material defect or of workmanship defect. The exclusion of defective material / workmanship is limited to the parts of the structure immediately affected and does not apply to any consequential loss to correctly executed items, arising out of the accident due to defective material or workmanship.
  • loss or damage due to gradual deterioration, atmospheric condition, rusting etc.
  • loss discovered only at the time of taking inventory.
  • arising out of penalty for delay, non-fulfillment of terms of contract.

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