Machine & Equipment - Section B-4 (All Risks Insurance)


Machines & Equipment Insurance Policy is designed to cover plant. machineries and equipment kept and/or used within the Insured's premises. Due to its comprehensive cover, this type of policy is suitable for all types of industries/business. Properties that can be covered include office equipment. furniture, fixtures and fittings, medical/scientific equipment (mobile and immobile) industrial plant and machineries.

Scope of cover

The coverage afforded by this Insurance is very much wider than a Fire policy. It covers loss or damage by any unforeseen sudden and accidental cause such as 
a) Fire and/or lightning 
b) Accidental damage 
c) Theft accompanied by forcible, violent entry/exit

Extensions 

This Policy can be extended to cover a) Strike Riot and Civil Commotion b) Subsidence and landslip

Basis of Insurance

The sum insured of the machine and equipment can be arranged on an indemnity or reinstatement value basis. Machines and equipment arranged on an indemnity basis must reflect its present market value after taking into account depreciation. However, if the machines and equipments are insured on a replacement value basis (i.e. new for old) the sum insured must reflect the present day replacement cost Such cover can be granted for machines and equipment up to 5 years old. Older machines and equipments exceeding 5 year< old may only he granted if we are satisfied that it has been maintained in good conditions and there is no moral hazard involved (for e.g. integrity/character of the proposer are not in doubt and the proposer's business is doing well and profitable)

Premium Rating/Rating basis

As the coverage under a Machine & Equipment policy is much wider than a Fire Policy, the rates to be applied, less where applicable 15% commission. shall be as follows:
(i) at least the minimum fire and lightning rate (either  tariff or special rate, whichever applicable) to be charged according to the occupation and construction classification of the risk; and 
(ii) at least a flat rate of 0.250% to be charged for all  other covers not excluded under the Machine &  Equipment or All Risks Policies.
(iii) In the event the rating above is not agreeable by the Insured, the insured may opt to insure under named perils basis and the rate would be charged  according to the selected perils to be insured only. 

Listing down the cover(s) to be excluded under the Machine & Equipment or All Risks Policy to be issued are not allowed if the option to insure under named perils is requested by the Insured.

For easy reference the rating guide for M & E policies is attached.

In arriving at the rate of premium for machines and equipment risk, certain loading factors are applied on the basic gross fire tariff rate to cover the non fire risk such as :
a) special perils of a fire policy.
b} theft.
c) accidental damage

Minimum Premium

a) The minimum premium before commission, shall not be less than RM100.00. In the event of  cancellation before the expiry date, the minimum  premium to be retained by the Company shall be             RM100.00.
b) No refund of premium shall be allowed for cancellation of policy before the expiry date if minimum premium is charged in the policy.

An example of the rating structure for Machine & Equipment policy is set out below

  %
Basic Fire Rate (trade code 2504.
Construction IB) 0.429
 Plus Full Peril, Per MNRB guidelines 0.250
  0.679
 Less 15% Fire Commission 0.102
  0.577
 Gross up 25% for commission/ brokerage 0.7695
 Add 10% loading for accidental damage 
 and theft cover 0.076
  0.846


Excess

 Office Equipment, Furniture, Fixture and Fittings 1% of Sum Insured Minimum RM500
 Medical/Scientific Equipment 2% of Sum Insured Minimum: RM1,000
 Industrial Plant and Machinery 3% of Sum Insured Minimum : RM2,500
  
  


Referred Risks (Acceptance of such risk is to be referred to Business Development or Branch Head)

7.1 Bamboo & Basket Manufacturers
7.2 Cyber Cafes
7.3 Electronic and related factories
7.4 Equipment (owned by hire and rental company) which are for hire
7.5 Furniture shops

7.6 Rice Mills
7.7 Risks located in areas known to be flood-prone (unless without fl00d cover)
7.8 Risks located in/near hilltop/bill slope (unless without subsidence and landslide cover)


Special Acceptance Risks (Acceptance of such risk is to be referred to Portfolio Underwriters/ Head of Underwriting and Technical Support)

8.1 Adhesives Manufactures
8.2 Amusement arcades/centre
8.3 Candle Factories
8.4 Celluloid Goods Manufacturers
8.5 Chemical works
8.6 Cotton Waste / warehouse
8.7 Copra Kilns
8.8 Discotheques, Nightclubs, bars, pubs, karaoke and the like not located in
8.9   shopping mall or 4/5 star hotel
8.10 Foamed rubber manufacturers
8.11 Furniture malls in established shopping complexes
8.12 Lacquer Manufacturers
8.13 Oil Paints Manufacturers
8.14 
Oil and Gas risks of petroleum  industry)
8.15 Oleo-Chemical Factory
8.16 Paper Products Manufacturer except Printers/ Printing Shops
8.17 Polish Manufacturer
8.18 
Risks located in/near hill top/hill slope with subsidence and landslide Cover
8.19 Risks under receivership
8.20 Resin & Turpentine Manufacturers
8.21 Rubber Smokehouse
8.22 Sawmill/Plywood Factories
8.23 Silent Industrial Risk
8.24 Sign Board Maker/ Frame Maker Premises
8.25 Timber Drying Kiln
8.26 Tire Retreading and vulcanizing
8.27 Wax Factories
8.28 Waste paper dealers/stores/Processors


Declined Risks 
(Any accommodation of such risk is to be referred to Head of Underwriting and Technical Support/Risk Review Committee)

9.1 Ammunition Works

9.2 Building of class 3 construction
9.3 Explosive (using or making) Factories/Premises
9.4 Discotheques,nightclubs, bars, pubs, karaoke and the like (unless 
        in shopping mall or 4/5 star hotel)
9.5 Furniture malls (other than in established shopping complexes)/Furniture factories/Woodworking risks
9.6   Joss Goods Manufacturers
9.7   Match Manufacturers/Stores
9.8   Mosquito Coil Manufacturers
9.9    Offshore risks
9.10 Plastic Goods Manufacturers
9.11 Plastic Recycling Plant/stores
9.12 Textile & Garment Factories
9.13 Tobacco Barns
9.14 Wax Factories
9. 15 Waste paper dealers/stores/Processors
9.16 Deductible Buy-back policies
9.17 Layered or Excess of loss policies
9.18 Policy on First Loss Basis
9.19 Nuclear Energy Risks





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Questionnaire and Proposal for Machinery Insurance  Aug 7, 2012, 2:17 AM YVONNE WONG
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Payment instruction to insurer for your insurance transaction. 信用卡付款指令,保险公司的保险交易。Pembayaran Kad Kredit arahan kepada syarikat insurans untuk transaksi insurans anda.  Dec 13, 2012, 6:27 AM YVONNE WONG
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MPIB -MULTI-PURPOSE INSURANS BHD - AGENTS' GUIDE  Jan 5, 2013, 5:43 AM YVONNE WONG