Machinery Breakdown (MBD)

MBD provides effective insurance cover for plant, machinery and mechanical equipment at work, at rest or during maintenance operations. It covers unforeseen and sudden physical loss of or damage to the insured items, necessitating their repair or replacement. MBD insurance supplements the coverage afforded by fire insurance..

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Scope of Cover

Loss or damage covered under MBD insurance is mainly due to one of the following causes:

  • Defects in casting and material
  • Faulty design
  • Faults at workshop or in erection
  • Bad workmanship, lack of skill, carelessness
  • Shortage of water in boilers
  • Physical explosion
  • Tearing apart on account of centrifugal force
  • Electrical causes such as short circuit

The sum insured should always be equal to the costs of replacement of the insured machinery by new machinery of the same kind at the same place (value of the new item plus customs duties plus transportation and installation charges).

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