This is a policy which covers financial loss incurred by the insured due to loss or damage to machinery as a result of sudden accidental electrical and mechanical breakdown. It reimburses the insured for the cost of repairs or replacement of machinery of like nature.
This insurance can be taken by the individual owner of the machine or a person or company having financial interest in the machine.
All types of Industrial & Domestic machinery like compressors, pumps, turbine etc. as also electrical machines like transformer, electrical motor, generator etc. can be covered under this policy.
It is a requirement of this policy that the sum insured or value for which the particular machine is insured should represent the present day purchase value of a similar new machine including all incidental expenses like custom duties, taxes, excise, freight, insurance charges, handling charges etc.
In case the sum insured under the policy is less than as per the above requirement the claim will be paid only in such proportion as the sum insured bears to the current replacement cost of similar new machinery.
The policy covers all kinds of electrical and mechanical breakdown resulting from the following incidents