Contractors All Risk Policy

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  • Covers construction site and material purchased for project
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Advantages of Construction All Risk Insurance

Construction Site Protection
Contractors all risk policy covers damages to under construction civil projects by sudden, and accidental causes. It also covers the damage to the material purchased for the project at the site.
Third Party Liability Coverage
Construction all risk insurance covers third party property damage that may arise due to accident at site. Policy also covers liability for fatal or non-fatal injury to persons other than employees.
Customised Cover
We customise contractors all risk insurance policy according to your requirements. For example, construction equipment like scaffolding and shuttering materials can be covered in policy if required.
Limited Exclusions
Contractors all risk insurance has limited exclusions such as willful negligence, and faulty workmanship. All other risks are covered. This gives a wide ambit of coverage for unpredictable risks

Benefits of Construction All Risk Insurance

All Risk Cover for Construction Projects

  • Our construction policy provides all risk cover for under construction projects from perils including fire, explosion, impact damage and collapse
  • For projects with more than 100 crore sum assured, policy could be enhanced to cover design defects
  • Natural catastrophes such as earthquake, storm, flood and lightning are covered under the policy

Advance Loss of Profits

  • Advance loss of profits (ALOP) is an add-on coverage to Construction All Risk policy that can indemnify loss of profits due to delay in start-up of the project due to a covered peril
  • Loss of net profit and standing expenses of the project are considered to arrive at sum assured for ALOP
  • A standard excess in terms of number of days is applicable before the claim is triggered

Add-on Covers

  • Contractor's all risk policy offers several add-on coverages that are related to a claim under the main policy e.g., owners' surrouding property
  • Other add-ons include loss of documents, escalation in sum assured, removal of debris, additional custom duty
  • Each add-on is priced separately; though at higher sum assured, a few add-ons could be availed at nominal cost


Construction All Risk Insurance covers damage to the civil construction projects such as, residential and office buildings, hospitals, schools, theaters, roads, railways, bridges, tunnels, airports, dams, weirs, irrigation and drainage facilities, canals and ports. Policy also covers faults in project and the temporary work erected or constructed on site.
Wide range of additional extensions are available under construction all risk policy such as coverage of construction equipments like block pulleys, drilling machine and welding machines, maintenance visit or extended maintenance cover, debris removal expenses, air freight & express freight, free automatic reinstatement upto 10%
In contractor all risk policy, if a project gets extended the same can be endorsed under the policy. You need to inform the insurer in advance about the extension. Additional premium would be charged for the incremental period to extend coverage.
In construction all risk policy, design defect is an exclusion. However, our team can negotiate with various insurance companies and get this design defect coverage added in your policy at added premium. In our recommendation, every contractor or developer should cover design defect in their policy as there are high chances of claims arising due to defect in design at the initial stage of the project.
Insurance companies have different underwriting and premium charging criteria as per types of construction projects. For instance, for residential and commercial buildings, the premium rates vary between 1%-4% up to first three months. Also, there is an additional premium rate(%) per month in case a client wants to continue beyond the initial policy period. The premium of construction all risk insurance policy depends on the number of storeys’ as well. Depending on the sum assured, and loss history, it is possible to negotiate lower premium with the insurer.
Yes, you can get the additional value of the project included in the current ongoing policy. You just have to make sure that you inform us with all the details with breakup of item and its values before or as soon the purchase is made. This will help us to share the calculation of additional premium required to add the increased value of the project and cover it immediately once you pay the premium.
Under contractors all risk policy, there are many add-ons available and premium is also different for different add-ons. A few add-ons can be covered at very minimal charges in the policy such as professional fees, removal of debris. Then there are add-ons such as design defect cover, escalation cover, extended maintenance cover which cost little extra compared to standard add-ons but are very important to cover.
In order to start your construction all risk insurance, it is advised to take the help of insurance advisors such as SecureNow. We will help you design an optimum policy, will get multiple quotes from various insurers, help you with easy documentation and will also be helping you during any claim. To start with, you can just fill the above contact detail form and we will get in touch you within same day to start the process.
In case of claim in contractor all risk insurance, you should immediately intimate our team in case of a damage to the project site, also share nature and extent of the loss or damage to the project. Then you should take all the possible steps to minimize the loss. Insurer will then appoints the surveyor for the inspection of site. Our team will work with you to submit all necessary documents required by insurance company during the entire process.
The common documents required for filing the claim are filled claim form, letter of award and bill of quantity, purchase or delivery order details, damage report on extent of damage, estimated cost of repair or lost product. In addition to these documents, the insurer and surveyor can ask for some additional documents based on the type of claim during the course of the process.
In the event of any loss the basis of any settlement under this policy depends on the type of loss. In the case of partial damage which can be repaired the cost of repairs necessary to restore the property to their condition immediately before the occurrence of the damage less salvage. In the case of a total loss - the actual value of the property immediately before the occurrence of the loss less salvage is paid.
There are various additional costs and expenses which will paid during an event of a claim, but subject to these additional extensions are covered under the policy. Few examples of add-on cost & expenses which can be covered under are debris removal, air freight, additional custom duty, professional fees, plans & documents-and loss minimization expenses. Our team will help you cover these add-ons cover in your policy.
Any injury or accident caused to the workers on the site is not covered under contractors all risk policy. Liability arising out of an injury or damange to a third party due your construction is covered under this policy. If you want to cover workers injury, you can take workmen compensation insurance for them.
Construction all risk is the insurance specifically designed for those who are involved in civil construction business. Some of these includes, contractors, sub-contractors or firms commissioned to carry out work, owner or purchaser, and companies financing the project. If you are a contractor or a principal developer and starting a new project , construction all risk insurance is a must to cover various kinds of risks which can happen during the construction.
There are three types of erection all risk policy :
1. Basic Policy - Covers material damage and third party liability cover.
2. Policy with limited add-ons - Additonal to the basic cover, this policy covers other add-ons such as damage to owners surrounding property and third party liability with cross liability.
3. Comprehensive Policy - The policy provides holistic cover by covering few key exclusions aswell such as design defect and other important clauses like waiver of subrogation and contribution.
There is a minimum excess which will be deducted from the claim amount during the final settlement. This excess is there in contractors all risk policies of all the insurance companies as prescribed under tariff by IRDA. At minimum, excess is 5% of the claim amount subject to minimum of Rs 50,000 for non-act of god perils. After deducting the excess or other amounts mentioned in the policy, insurance company will then pay the claim to you.


What is declaration clause in Construction all risk policy?

Construction all risk insurance policy offers to cover the assets and liabilities of the contractor during the construction work. The policy is arranged to cover the assets like materials, tools, plant and equipment from any loss or damage. It also covers the contractor against the liability arising from undertaking the construction work....
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Does the Construction All Risk Policy cover damage to surrounding structures?

Yes, the construction all risk insurance policy covers damage to surrounding structures as well. Loss or damages to property which are located on or adjacent to the construction site, belong or held in custody or control of the policyholder shall be covered if the loss/damage occurs directly due to those construction items which are insured....
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What is Claims Series Clauses in Construction all Risk Policy?

As per the claim series clause, where a series of losses or damages or bodily injuries and deaths happen due to factors which are directly or indirectly related, then claims for such losses shall be added together and treated as one claim. Such claims shall be deemed to have been made at a single point of time when the first claim was made....
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