Plant and Machinery Insurance

Hired-In Plant Insurance may cover machinery a business hires from another owner, where the relevant hire exposure has been declared and accepted by the insurer.

Hire agreements can place responsibility for physical damage, theft or other costs on the business hiring the equipment. However, an insurance policy may not cover every liability accepted under a hire agreement.

Cover may include:

• Accidental damage to declared hired-in machinery
• Theft, fire or storm damage, where included
• Excavators, loaders, cranes, access equipment and other hired plant
• Machinery hired for construction, civil or mining projects
• Hired equipment used at declared work locations
• Plant in transit, where covered
• Continuing hire charges following insured damage, where specifically included
• Hired-in machinery under scheduled or agreed blanket limits, where available

For example, a civil contractor may hire an additional excavator for a subdivision project. The contractor may be responsible for certain damage under the hire agreement, even though the excavator belongs to another business.

Some policies require each hired machine to be declared. Others may provide a limit for eligible hired-in equipment under an agreed arrangement.

Hired-In Plant Insurance is commonly considered by construction businesses, earthmoving contractors, civil contractors, mining service providers and businesses that hire additional equipment for specific jobs.

The hire agreement, equipment value, hire period, operating activities and policy conditions should be checked before the machinery is used.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Wet Hire Plant Insurance may cover eligible machinery supplied to a customer with an operator, where the insurer has accepted the hire arrangement and declared activities.

Wet hire generally involves a business supplying both the equipment and a person to operate it. The machinery owner remains involved in operating the plant while providing services to the customer.

Cover may include:

• Accidental physical damage to insured machinery
• Fire, theft and storm damage, where included
• Declared machinery used on customer sites
• Equipment operating across different project locations
• Attachments supplied with the machine, where insured
• Transit between work locations, where included
• Machinery recovery expenses following an insured incident, where covered
• Loss of hire income, where specifically arranged

Wet hire activities may also create third-party liability exposures that require separate Public Liability Insurance.

For example, an earthmoving business might supply a 30-tonne excavator and operator to a civil infrastructure project. The plant policy may address specified damage to the excavator, while liability arising from the operation may need to be considered separately.

Wet Hire Plant Insurance is commonly considered by earthmoving contractors, crane hire businesses, civil contractors and plant companies supplying operated machinery.

Insurers may require information about operator qualifications, equipment maintenance, operating activities, site conditions and contract requirements.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Dry Hire Plant Insurance may cover machinery supplied to customers without an operator, where the insurer has accepted the dry hire exposure.

Under a dry hire arrangement, the customer generally arranges operation of the equipment during the hire period. The machinery owner may have less direct control over how the equipment is used.

Cover may include:

• Accidental damage to insured machinery while on hire
• Theft or malicious damage, subject to policy conditions
• Declared machinery used by approved hire customers
• Fire, storm and other specified insured events
• Attachments supplied with the machine, where included
• Transit and delivery, where covered
• Cover reflecting declared hire agreements and damage waiver arrangements, where accepted by the insurer.
• Loss of hire income following an insured event, where included

Dry hire policies may also involve:

• Customer identification and hire agreements
• Operator competency requirements
• Restrictions on equipment use
• Security and theft prevention conditions
• Off-hire and return procedures
• Exclusions relating to non-return or unlawful conversion
• Contractual responsibility for damage and continuing hire charges

A machinery policy arranged for owner-operated equipment does not automatically include dry hire activities.

Dry Hire Plant Insurance is commonly considered by equipment rental companies, earthmoving plant hire businesses, access equipment suppliers, forklift hire companies and other machinery owners hiring equipment to customers.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Accidental Damage Insurance may cover sudden physical damage to insured machinery resulting from events included under the policy.

This is a common component of Plant and Machinery Insurance, particularly for mobile equipment used across construction sites, civil projects, mining operations and industrial workplaces.

Cover may include:

• Collision with another machine or object
• Accidental impact damage
• Machinery rollover or overturning
• Accidental damage during declared operating activities
• Damage to insured structural or mechanical components caused by an insured event
• Accidental damage while machinery is stored or parked, where covered
• Damage occurring during transit, where included

For example, a wheel loader may collide with a fixed structure while operating at a quarry. A material damage policy may respond to eligible repair costs if the incident falls within the cover.

Accidental damage does not necessarily include internal machinery breakdown, wear and tear, gradual deterioration or damage arising from excluded activities.

Insurers may also apply conditions relating to operator qualifications, maintenance, operating locations and machinery use.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Plant and Machinery Insurance may cover damage or loss caused by fire, theft, storm and certain other specified events, depending on the selected policy.

Commercial machinery may be stored in depots, open yards, workshops, construction sites or remote work locations. The insurer may consider where equipment is kept and the security arrangements in place.

Cover may include:

• Fire damage to insured machinery
• Theft of specified plant and equipment
• Malicious damage or vandalism
• Storm and hail damage
• Damage from falling objects, where covered
• Certain water-related incidents, where included
• Physical damage while equipment is stored at declared locations

Theft cover may be subject to security conditions, policy limits and exclusions.

For example, machinery stolen from a secured depot may be assessed differently from equipment supplied to a customer who fails to return it.

Flood cover, theft without forcible entry, dishonesty, unlawful conversion and equipment left unattended may be restricted or excluded.

The available protection should be checked against the machinery’s storage and hire arrangements.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Machinery Breakdown Insurance may cover certain sudden and unforeseen mechanical or electrical failures affecting insured equipment, where this cover has been specifically arranged.

Standard accidental damage cover may not respond when a machine stops working because an internal component fails.

Machinery breakdown cover may include:

• Sudden mechanical failure
• Electrical breakdown
• Damage to insured engines or transmissions
• Hydraulic system failures, where covered
• Damage to eligible internal mechanical components
• Repair or replacement of covered damaged parts
• Additional repair expenses, where included
• Freight or temporary replacement equipment costs, where specifically insured

For example, an industrial compressor may suffer an unexpected mechanical failure during normal operation. A machinery breakdown policy may respond if the failure meets the policy’s insured event definition.

Machinery Breakdown Insurance may be available through specialist mobile plant cover or a separate machinery breakdown section of a property policy.

Wear and tear, gradual deterioration, poor maintenance, corrosion and pre-existing defects are commonly excluded or restricted.

Breakdown cover should be checked separately from accidental damage insurance.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Plant in Transit Insurance may cover eligible machinery against accidental physical loss or damage while it is being transported between locations.

Plant and machinery businesses frequently move equipment between depots, construction sites, civil projects, mines and other work locations.

Depending on the policy, cover may include:

• Physical damage during road transport
• Machinery carried on plant floats and trailers
• Transport by the machinery owner’s vehicles
• Third-party transport carriers, where accepted
• Machinery moved between declared sites
• Accidental damage during an insured journey
• Temporary storage incidental to transit, where included
• Loading and unloading exposure, where specifically covered

For example, a tracked excavator may be transported from a metropolitan depot to a regional civil construction project. Transit cover may respond to eligible damage occurring during the insured journey.

Oversized machinery, specialist heavy haulage, interstate transport and remote-site delivery may require additional declarations.

Cover while machinery is operating does not automatically mean it is insured during transport.

Plant in Transit Insurance is commonly considered by machinery owners, plant hire businesses, construction contractors, mining service providers and equipment suppliers.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Loading and Unloading Cover may respond to certain accidental physical damage to insured machinery while it is being loaded onto or unloaded from a transport vehicle.

Moving machinery onto plant floats, trailers or transport platforms can involve activities that are treated separately from normal road transit.

Cover may include:

• Damage while machinery is loaded onto a plant float
• Accidental damage during unloading at a worksite
• Equipment damage caused by a covered loading incident
• Machinery handled by approved transport operators, where included
• Loading and unloading at declared premises or project locations
• Certain lifting or handling activities, where covered

For example, a skid steer may suffer accidental damage while being unloaded from a trailer at a construction site. Whether the policy responds depends on the loading and unloading provisions.

An insurer may distinguish between machinery being driven onto a trailer and equipment being lifted using a crane or other handling method.

Cover should be checked for loading procedures, transport methods, operator arrangements and excluded handling activities.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Plant and Machinery Insurance may cover attachments, accessories and auxiliary equipment where the items are declared, included in the insured value or otherwise covered under the policy.

Some attachments are used across several machines and may be stored or transported separately from the main equipment.

Cover may include:

• Excavator buckets
• Hydraulic hammers and breakers
• Augers and trenching attachments
• Grabs and grapples
• Compaction attachments
• Forklift tynes and lifting attachments
• Drilling and demolition attachments
• GPS and machine-control systems, where included
• Permanently fitted accessories
• Specialist attachments listed on the machinery schedule

Insurers may apply different conditions depending on whether an attachment is connected to the machine, detached, stored or transported separately.

For example, a hydraulic breaker may need to be declared as an individual insured item rather than assumed to be included within the excavator’s value.

Businesses with multiple attachments should check the machinery schedule and applicable item limits.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Plant and Machinery Insurance may be available for eligible registered and unregistered machinery, but operating on public roads can create additional insurance considerations.

Some mobile plant is registered for road use, while other machinery operates on private worksites, industrial facilities, farms or mine sites.

Depending on the policy, cover may include:

• Accidental damage to road-registered machinery
• Fire and theft involving insured registered plant
• Machinery travelling between declared locations
• Third-party property damage from road use, where specifically insured
• Plant operating on private sites
• Certain off-road operating conditions
• Finance or interested-party endorsements, where required and available

Compulsory Third Party injury insurance, third-party property damage insurance and physical damage cover are separate matters.

For example, a road-registered mobile crane may require a different arrangement from an unregistered excavator that is transported between sites on a float.

Road registration, compulsory motor injury insurance and licensing requirements vary between jurisdictions.

The equipment’s registration status, road use and operating activities should be disclosed to the insurer.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Goods on Hook Insurance, also referred to as Hook Liability, may cover certain legal liability for damage to third-party property while it is being lifted, suspended or handled by insured lifting equipment.

This is a liability extension associated with lifting operations. It is separate from cover for physical damage to the crane or machinery itself.

Goods on Hook Insurance may be relevant for:

• Mobile cranes
• Truck-mounted cranes
• HIABs
• Hoists
• Telehandlers used for declared lifting activities
• Other approved lifting machinery

Depending on the policy, cover may respond to certain legal liability for:

• Third-party property damaged during lifting
• Property being suspended or moved
• Eligible handling incidents involving declared equipment
• Specified lifting operations accepted by the insurer

Goods on Hook Insurance may be arranged through Public Liability Insurance, heavy motor insurance or a specialist plant policy, depending on the insurer.

The value and type of property being lifted, lifting methods, operator requirements, policy limits and exclusions can affect the available cover.

A standard Plant and Machinery Insurance policy should not be assumed to include Hook Liability.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Some Plant and Machinery Insurance policies include or offer extensions for certain expenses associated with recovering, transporting or repairing machinery after an insured event.

These extensions may be relevant where machinery operates at remote sites or where recovering damaged equipment requires specialist services.

Cover may include:

• Recovery of damaged insured machinery
• Towing or transport following insured damage
• Removal of debris
• Specialist lifting equipment needed for recovery
• Additional freight expenses, where included
• Temporary storage of damaged equipment
• Emergency repair expenses, where covered
• Certain additional costs associated with preventing further insured damage

For example, recovering an immobilised loader from a remote mine site may require a specialist recovery vehicle and heavy transport equipment.

Recovery expenses may have separate limits, sub-limits, excesses or requirements for insurer approval.

Routine towing, maintenance-related transport and equipment recovery unrelated to an insured incident may not be covered.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Loss of Hire Insurance may cover certain hire income lost when insured machinery cannot be used following a covered event.

This type of extension may be relevant for plant hire businesses and machinery owners earning income from equipment rental.

Cover may include:

• Loss of hire income following insured physical damage
• Specified additional operating expenses
• Temporary replacement machinery costs, where included
• Agreed payment limits
• Defined waiting periods
• Specified indemnity periods
• Other business interruption extensions, where available

For example, a plant hire company may be unable to hire out an excavator while repairs are completed following an insured rollover.

A Loss of Hire extension may respond to eligible lost hire income, subject to the policy wording and any applicable waiting period.

Some hired-in plant arrangements may also offer cover for continuing hire charges after insured damage. This is a different exposure from a machinery owner’s loss of hire income.

Loss of Hire Insurance does not automatically respond to routine maintenance, general downtime, reduced demand or contract cancellation. Mechanical breakdown may only qualify where specifically included.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Plant Fleet Insurance may provide an arrangement for insuring multiple eligible machines under one policy.

A fleet policy may use a machinery schedule listing equipment descriptions, serial numbers, insured values and other details relevant to the insurer.

Individual Machines and Small Fleets

For businesses with a small number of machines, insurance values may be determined using an available valuation basis.

Common arrangements include:

• Market value cover
• Agreed value cover
• Replacement value cover, where available
• Specified item values
• Declared attachments and accessories
• Finance or interested-party endorsements

Market value generally reflects the machinery’s value immediately before an insured loss, subject to the policy definition.

Agreed value refers to an insured amount accepted under the policy, although settlement conditions still apply.

Replacement value cover may offer a different settlement basis, subject to the insurer’s eligibility requirements and policy conditions.

Larger Plant Fleets

For businesses managing multiple machines, policy considerations may include:

• A machinery schedule covering eligible fleet items
• Agreed processes for adding and removing plant
• Changes in machinery values
• Equipment purchases and disposals
• Machines financed or leased through different providers
• Multiple operating and storage locations
• Specialist equipment and high-value attachments
• Different excesses for machinery categories
• Temporary equipment movements or hire arrangements

The insured value may differ from the amount payable following a claim, depending on the settlement provisions, excesses, depreciation conditions and other limits.

Plant Fleet Insurance is commonly considered by civil contractors, earthmoving companies, plant hire businesses, mining service providers and other organisations with multiple machines.

Cover is subject to policy terms, conditions, limits, exclusions and insurer acceptance.

Contract-Specific Endorsements and Extensions are changes, additions or documentation requirements that may be requested under a machinery finance agreement, lease, hire contract, construction contract or principal contractor insurance schedule.

They are not a standalone insurance product.

Whether an insurer can provide the requested wording depends on the policy, declared machinery, operating activities, contract conditions and insurer acceptance.

Common plant and machinery insurance requirements may include:

• Interested-party or financier noting
• Agreed machinery values or settlement provisions
• Hired-in plant extensions
• Hired-out plant cover for wet hire or dry hire
• Specified damage waiver arrangements, where available
• Continuing hire charges, where covered
• Loss of Hire Insurance extensions
• Plant transit and loading or unloading provisions
• Goods on Hook Insurance, where available
• Specified machinery limits or excess requirements
• Contract-specific Certificates of Currency
• Site-specific or project-specific wording
• Principal’s Indemnity or other liability endorsements under relevant separate policies, where required and available

All Trades Cover may be able to review an insurance schedule, identify requirements that differ from the existing cover and approach relevant insurers about available endorsements.

Changes to cover require insurer acceptance or approval under an authorised arrangement. A Certificate of Currency records the insurance in place and does not amend the policy.

A policy or Certificate of Currency should not be assumed to satisfy every finance agreement, machinery hire contract, tender or site-access requirement.

Cover and endorsements are subject to policy terms, conditions, limits, exclusions and insurer acceptance.