An Erection All Risks insurance comprehensively covering the property loss and liability during the bring-in, install, assembly and commissioning of large machinery — plant, power and manufacturing equipment.
N2N Insurance Brokerage does not represent any single insurer — it independently represents the client as an FSS-registered broker (Reg. No. 2026-012201). We compare the wordings, rates and service of AIG · Chubb · DB · Hyundai · KB · Meritz to propose the cover and price best suited to your risk. Each insurer's full wording is provided at application and binding.
An Erection All Risks insurance comprehensively covering the property loss and liability during the bring-in, install, assembly and commissioning of large machinery — plant, power and manufacturing equipment.
Specialised for machinery-centred projects — plant, power equipment, production lines.
The highest-accident-risk commissioning/performance-test period included in standard cover.
Orderer, EPC contractor, equipment supplier and partner can be co-insured.
Underwriting overseas sites via the MunichRe/SwissRe reinsurance network.
Petrochemical, refining, power, steel, semiconductor, battery plants.
Industrial-machinery, HVAC, power-equipment installers.
Solar, wind, hydrogen, ESS install projects.
| Policy period | Install period + commissioning + maintenance period |
|---|---|
| Insurers | AIG · Chubb · DB · KB · Meritz · Hyundai (compared, reinsurance-linked) |
| Sum insured | Equipment/contract value 100% basis |
| Turnaround | 2–6 weeks (including reinsurance) |
| Channel | Individual consultation with our broker (010-5755-6465) |
If the insured event has already occurred at the time the contract is made, the contract is void. However, where the contract is void due to the company's intent or negligence, or where the company knew or could have known of the nullity before acceptance yet did not refund the premium, the company refunds the premium with interest at the policy-loan rate published by the Korea Insurance Development Institute, compounded annually, for the period from the day after payment to the day of refund.
The specific losses not covered (exclusions) are set out in each insurer's policy wording and product description; on this page, see the “Cover” tab(or the “Losses not covered” section) for the main exclusions. For other cover-specific grounds on which claims are not paid, please refer to the policy wording.
The company provides cover, in accordance with the policy, from the time it accepts the application and receives the first premium. Where the company accepts the application after receiving the first premium with it, cover also begins from the time the first premium was received.
The application must be completed by the policyholder, and the policyholder and the insured must sign it by hand. Failure to sign by hand may result in disadvantages regarding the validity of the contract. On an internet cyber-mall, an electronic signature may be used instead.
The policyholder has the right to be given and have explained the information needed about the product they wish to buy.
The insurer and N2N Insurance Brokerage must explain the important matters of the product to ordinary financial consumers.
When applying, the policyholder, the insured or their agent must disclose truthfully the facts they know regarding the questions in the application (including the questionnaire). Otherwise the claim may be declined or the contract cancelled. Where insurance is taken out by telephone or other means of communication, the duty is performed by answering the seller's questions, which are recorded, without a separate written questionnaire, so answers must be given with particular care.
If, after the contract is made, any of the following arises in respect of the subject-matter insured, the policyholder or the insured must notify the company in writing without delay and obtain endorsement on the policy.
The surrender value is the amount paid if the contract is cancelled early. Unlike bank savings, insurance combines risk protection and savings: part of the premium is paid out as claims to other policyholders who suffer accidents, and part covers the insurer's operating expenses, so the surrender value on early cancellation may be less than the premiums paid, or nil.
Under Article 59-4(1) of the Income Tax Act (special tax credit), for protection-type insurance taken out by an employee only, a tax credit of 12% of the premium paid (capped at KRW 1 million per year) is available. Tax matters may change with amendment or repeal of the relevant tax law.
Except as provided by law, the insurer and N2N Insurance Brokerage do not collect, use, inspect or provide personal data related to this contract — for its conclusion, maintenance and claim payment — without the consent of the policyholder, the insured or the beneficiary. However, for those purposes the insurer may, with the consent of the policyholder and the insured and in accordance with law, provide personal data to other insurers and insurance-related bodies.
The above is a summary and excerpt of the policy wording; for grounds on which claims are not paid and other details, please refer to the policy wording and product description.
Risk patterns that come up often at an install site — a five-scenario self-check
Petrochemical, power and steel plant install carries high machinery-accident risk.
Industrial-machinery, HVAC and power-equipment install carries property and liability risk.
Solar, wind, hydrogen and ESS install projects carry equipment-loss risk.
Commissioning/performance-test is the highest-accident-risk leg of erection works.
Overseas sites need underwriting via the reinsurance network.
At a plant install site, some equipment was damaged during commissioning (Hot Testing). If the installer, when taking out Erection All Risks (EAR), included the commissioning endorsement, the property loss during commissioning becomes reviewable under the wording, and the emergency-restoration cost to reduce schedule delay is reviewed too, depending on whether the Expediting Expense endorsement was taken. Conversely, insuring only the standard wording and omitting the commissioning/emergency-cost endorsements leaves the commissioning-stage accident — the most frequent in power/plant projects — as a cover gap. This is the item that power/energy sites with a large commissioning share most often miss at enrolment.
Source: (General industry example)
The wording and structure points decision-makers most often overlook
Commissioning/performance-test is the highest-accident-risk leg of erection works, but it is sometimes left out of the standard quote. Confirming the quote includes commissioning cover at enrolment is the principle.
The level excluding only the defective part (LEG 2) and the level covering the consequential loss from the defect (LEG 3) differ greatly. For plant/power equipment, reviewing the LEG 3 level at enrolment is usual.
If the orderer, EPC contractor, subcontractor and designer are not named co-insured, they become the subrogation target after an accident, which can escalate into a stakeholder dispute.
The questions decision-makers ask most when considering Erection All Risks (EAR) insurance
Electrical/mechanical accidents during the commissioning/performance-test period can be covered by a commissioning endorsement. Commissioning is the highest-accident-risk leg of erection works, so confirm the quote includes this endorsement at enrolment.
The base wording excludes the ordinary defect-repair cost. Loss from a design/manufacturing defect varies in cover scope by the defect-cover endorsement level (LEG 2, LEG 3), so decide the level matched to the equipment/method at enrolment.
A defect during the maintenance period after commissioning ends can be covered by a Maintenance endorsement, usually designed within 12–24 months. Confirm the endorsement and its period in advance.
The orderer, installer (EPC), sub-subcontractor and designer can be named co-insured. If not named, they can become the target of subrogation after an accident, so including the install stakeholders as co-insured is usual.
The transport leg before site arrival and off-site storage are handled by the EAR-related endorsement or by cargo insurance. Cover divides at the point of site arrival, so confirm the two insurances link with no gap in the transport/storage leg.
The insurer assesses it on the equipment type and risk grade, the commissioning period and intensity, the designer/maker's engineering record, site conditions and past accident history. The exact premium and acceptance are confirmed after underwriting by insurers such as AIG, Chubb, DB, KB, Meritz and Hyundai.
