CPM is designed for sudden, accidental physical damage to machinery, not predictable maintenance issues. Many claim surprises happen when the cause is judged as wear and tear, poor upkeep, or internal breakdown without an external accident.
While CPM protects equipment, Contractors All Risk insurance (CAR insurance) focuses on the construction works themselves, making it important to understand how both policies complement each other.
Common Exclusions And Blind Spots To Watch:
- Wear and Tear: Gradual deterioration, corrosion, rust, and routine maintenance costs are typically excluded.
- Pure Mechanical or Electrical Breakdown: Internal failure is often excluded unless it leads to external accidental damage, depending on the wording.
- Pre‑Existing Damage or Defects: Old issues present before policy start are not covered.
- Wilful Negligence or Misuse: Overloading, unsafe operation, or ignoring manufacturer guidelines can lead to denial.
- Transit Gaps: Many CPM setups focus on operating risk, so check whether transit between sites is included or needs a separate arrangement.
- Consequential Losses: Downtime, penalties, and loss of income due to machine damage are generally not part of CPM unless separately structured.
Pro Tip For Accuracy: In CPM losses, service records and operator logs can matter as much as the repair bill. If the insurer questions maintenance, clean records reduce friction.
Contractors All Risk insurance (CAR insurance) protects construction works, while CPM safeguards machinery. Knowing exclusions, maintaining records, and aligning both policies ensures contractors reduce disputes, protect investments, and secure smoother claim settlements.
