Machinery Breakdown Insurance

Machinery Breakdown Insurance

Machinery Breakdown Insurance

Machinery Breakdown policy is an Ideal cover for Plant and Machinery, to cover the cost of Repairs or Replacement of damaged parts as a result of “ Accidental, Electrical and Mechanical Breakdown “.

Damage due to faulty material, human error/lack of skill operation of workers/operators, faulty construction, carelessness, overheating of parts, entry of foreign body, short circuit, faults in erection and failure of operations of Safety Devices are also covered.


The Sum Insured of the machinery should be its “Present-day Replacement Value” of similar type and capacity of a New Machine including incidental expenses, GST, customs duty, freight and erection charges. If the Sum Insured is not adequate the Under Insurance will apply at the time of claim.


    • In the case where damage to an insured item can be repaired, the Insurance company will pay expenses necessarily incurred to restore the damaged machine to its former state of serviceability, plus the cost of dismantling, re-erection, as well as ordinary freight and customs duty if any subject to policy conditions.
      No deduction will be made for depreciation in respect of repairs.
    • In the case when an insured machinery is totally damaged, warranting replacement, the insurance company will indemnify the insured the actual value of the machinery after deduction depreciation as per slab from the replacement value.
      The company will make payments only after being satisfied with the necessary bills and documents that the repairs/replacement has been carried out, as the case may be.
    • This Insurance is subject to “Under Insurance”, the sum insured is less than the Replacement value on the day of loss.


      1. Damage to the foundation of machinery.
      2. Oil in Transformer has to be specifically covered.
      3. Express freight, holiday and overtime rates of wages for a particular limit.
      4. Air freight
      5. Customs duty
      6. Damage to Surrounding properties and Third party damages.


Windmills can be covered for the following type of insurances

      1. Fire policy – as per standard Fire policy
      2. Burglary policy – as per standard Burglary policy
      3. Public Liability – the insured can select the Sum Insured as per their requirement.
      4. MBD – as per MBD Policy.
      5. Loss of profit due to Fire.
      6. Loss of Profit due to Machinery breakdown.

For more information regarding Machinery Breakdown Insurane