Engineering Insurance
Overview
Behind every factory, every high rise going up in Lagos and every power station humming in the background sits a class of cover most people never notice: engineering insurance. It is what pays when a steam boiler bursts, when a generator seizes, or when a half built bridge is swept away in a flood. Ordinary fire and burglary policies deliberately leave these risks out, so a whole family of engineering policies grew up to fill the gap.
In this lesson you will meet the main types: boiler and pressure plant, machinery breakdown, contractors' all risks and erection all risks. You will learn exactly what each one covers, why an inspection engineer keeps calling on the insured, who actually buys these policies, and how to work an engineering claim through average and an excess. Master it and you hold marks that many candidates simply leave on the table.
Objectives
- Identify the types of engineering insurance, including boiler, machinery and contractors' all risks
- Explain the scope of cover under each type of engineering policy
- Explain the role of periodic inspection in engineering insurance
- Identify the typical buyers of engineering insurance
Lesson Note
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Lesson Evaluation
Congratulations on completing the lesson on Engineering Insurance. Now that youve explored the key concepts and ideas, its time to put your knowledge to the test. This section offers a variety of practice questions designed to reinforce your understanding and help you gauge your grasp of the material.
You will encounter a mix of question types, including multiple-choice questions, short answer questions, and essay questions. Each question is thoughtfully crafted to assess different aspects of your knowledge and critical thinking skills.
Use this evaluation section as an opportunity to reinforce your understanding of the topic and to identify any areas where you may need additional study. Don't be discouraged by any challenges you encounter; instead, view them as opportunities for growth and improvement.
- Which policy covers the sudden bursting of a steam boiler in a factory? A. Fire and special perils insurance B. Boiler and pressure plant insurance C. Fidelity guarantee insurance D. Marine hull insurance Answer: B
- Contractors' all risks insurance is bought mainly by: A. Private motorists B. Building and civil engineering contractors C. Life assurance offices D. Poultry farmers Answer: B
- A power company installing a new gas turbine at its generating station should take out: A. Erection all risks insurance B. Burglary insurance C. Personal accident insurance D. Fidelity guarantee insurance Answer: A
- A machine is insured for 30,000,000 naira under a machinery breakdown policy with an excess of 1% of the sum insured. A breakdown costs 1,000,000 naira to repair. How much will the insurer pay? A. 1,000,000 naira B. 970,000 naira C. 700,000 naira D. 300,000 naira Answer: C
- The periodic inspection that accompanies engineering insurance is mainly intended to: A. Increase the premium each year B. Prevent loss and meet the legal duty to examine the plant C. Help the insurer avoid paying every claim D. Replace the need for a proposal form Answer: B
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Create a free account to access all learning resources, practice questions, and track your progress.
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