A Guide to Buying Engineering Insurance
As an Engineer, you face a whole range of risks, but it’s not just important that you have Insurance to protect you from these risks, but that you have the appropriate levels of cover too.
There are thousands of accidents and cases of ill health every year in the engineering business with thousands of different causes. More than half of all accidents reported to the HSE last year involved lifting and moving goods or trips and falls and between 10 -15% of accidents involved the use of machinery directly related to work.
What is Engineering Insurance?
Engineering Insurance provides all the necessary cover against electrical or mechanical machinery or computers as well as covering you against injury to third parties and their belongings such as employees or members of the public. In addition to this, certain items of equipment require mandatory examination and tests such as the Statutory Examination and Test, and these inspections will be part of the service provided by an Engineering insurance policy.
What Type of Engineer Are You?
The type of cover that you will need to purchase will depend on what type of Engineering work you do. Typically, Engineers fall into one of two categories:
Consultant Engineers – provide engineering-related services such as design, supervision, repair, maintenance, technology, specifications and recommendations to public, companies, firms and industries. Usually having an in-depth knowledge in one subject area.
Manufacturing Engineers – engineers that make, produce or supply a product to a third party.
These two categories of Engineers differ in which type of primary Insurance they will need. If you are a Consultant Engineer who gives advice then you will need Consulting Engineers Insurance which is a type of Professional Indemnity Insurance. PI Insurance will provide cover should any advice you give to a customer have a bad outcome, even in spite of the fact that this advice was given with the best interests. PI Insurance can cover the costs of repair work done to remedy the problem as well as compensation you may need to pay out.
Manufacturing Engineers may also need PI Insurance if they advise on work, yet the main type of Insurance required is Product Insurance. If you are involved in the manufacturing, supplying or repairing products from car parts to food, you will need to be insured should anything go wrong with something you have supplied.
If you are unsure which Engineering category you fall into, or have any questions about your Engineering Insurance Cover, call our team now on 01246 575 625 for professional and efficient advice.
Why Types of Engineers’ Insurance Will I Need?
With over 20% of workplace injuries occurring on a factory floor in 2014, having adequate Insurance for your Engineering Business has never been more essential. There are many different types of Insurance that can be arrange for your company and these will depend entirely on your business practises.
Employers Liability Insurance – EL Insurance is required by UK law if you have any employees whether full time or volunteers. Claims against companies for employers negligence are on the rise with many successful payouts to claimants. Engineers can work with hot materials, at heights and in difficult working conditions where an accident can easily happen. EL Insurance will provide cover should an employee have an accident whilst working for you.
Vehicle Insurance – If you drive a vehicle for work then you need a specialist Vehicle Insurance policy as a standard motor insurance policy won’t provide enough cover. There are a growing population of ‘grey drivers’ in the UK who use their social and domestic insured cars for work purposes and are unable to make a successful claim if they’ve had an accident whilst driving for work.
Public Liability Insurance – This should be seen as essential if you have anyone visit your place at work whether they are customers, members of the public or a health and safety inspector. Liability claims can be costly and time consuming and it only takes on customer to slip on an unmarked wet floor or injure themselves on piece of machinery for you to be tied up in legal jargon and paper work.
Engineers Professional Indemnity Insurance – If you give advice in any professional capacity then PI Insurance is vital when protecting yourself against any advice having an adverse affect on a client. Even if you have the best intentions, some advice may have negative outcomes and you could be held accountable. For example, if a type of roof that you have recommended using isn’t suitable and leaks, you could not only have to pay for the roof to be re done but for any damages to the building as well. PI Insurance is essential for rectifying any mistakes but also having the ability to do it efficiently, protecting your reputation as well.
Tools Insurance – Many Engineers have a range of tools that have been collected over years of working. These tools can accumulate to high monetary value, but more importantly, allow you to do your work. If anything were to happen to them, would you be able to replace them and carry on work instantly? Tools are often overlooked when considering Insurance, yet are soon very obvious when they are no longer there.
Product Liability Insurance – Product Liability Insurance provides cover should any product you have made or supplied turn out to be faulty. Faulty or defective products cannot only cause harm to the recipient, but also their property as well. For example, a faulty car part could cause the brakes to not work causing an accident damaging the customer and their vehicle. Product Liability Insurance can cover the costs of repairs and compensation should anything you supply be deemed below standard.
Business Interruption Insurance – If for any reason your business cannot carry out activity as usual, if there was a flood at your building for example, Business Interruption Insurance can help cover the costs of fixed overheads like rent or wages while your income has temporarily stopped.
Transportation Insurance – If you produce stock, you need to ensure that it is covered from the minute you create it until it’s reached the doorstep of the buyer if you transport it yourself. Transportation Insurance will protect your stock while it is in transit so if it gets stolen or damaged in an accident your efforts in creating it haven’t been futile.
Fleet Insurance – If you have 3 or more vehicles at work then Fleet Insurance can be a cost effective way of insuring multiple vehicles under one policy.
It is important to remember that just because an Insurance type isn’t required by law, that it isn’t essential for running a business. Some contracts, and government schemes won’t even consider working with you without adequate levels of cover.
If you are unsure about what type of insurance you need for your Engineering Business, call a member of our team on 01246 575 625 for professional and friendly advice.
Reducing the Risks of Claims
The majority of claims within the Engineering Sector come from employees that have had an accident at work due to the negligence of their employees that could have been easily avoided. Here are some simple and effective ways of managing the risks that your company can face.
- Regularly test products to ensure that they are working as expected
- Ensure regular staff training so all team members are aware of the correct procedures with all equipment being used
- Take the time to fully understand what products or brands you are recommending
- Keep up to date with new techniques and procedures in your area of work
- Provide a full guide of what you are recommending so clients understand what they are receiving.
There are more detailed guidelines for reducing risks within the Engineering Sector on the Health and Safety Executive Website.
If you have any further questions about Engineers Insurance, you can read more about it on our product page. If you still have questions, call our specialist Engineering Insurance Brokers on 01246 575 625 and a member of our team will be able to answer any questions you may have and advise you on the appropriate Insurance for you.