CAR Insurance: Everything You Need to Know About Contractors All Risks Insurance Cover in Kenya
The construction industry in Kenya continues to grow rapidly, with new projects ranging from residential estates to major infrastructure developments.
However, construction comes with significant risks, accidents, natural disasters, theft, and damage to property.
Contractors All Risks (CAR) Insurance offers a safety net, protecting contractors, project owners, and investors from unexpected financial losses.
What Is Contractors All Risks (CAR) Insurance?
CAR Insurance is a comprehensive policy that covers construction projects from unforeseen risks such as material damage and third-party liabilities. It ensures that contractors, project owners, and subcontractors are protected throughout the project’s lifecycle—from groundbreaking to completion.
CAR Insurance is suitable for:
- Residential, commercial, and industrial developments
- Infrastructure projects such as roads, bridges, and dams
- Pipeline installations and energy projects
Who Needs CAR Insurance?
Several stakeholders benefit from having CAR Insurance in Kenya:
- Contractors: Protect against unforeseen risks and ensure smooth project completion.
- Project Owners: Minimise financial risks associated with accidents or project delays.
- Subcontractors: Safeguard their work and machinery.
- Architects & Engineers: Ensure coverage for design flaws or professional negligence.
- Banks & Investors: Most financial institutions require CAR Insurance before financing large construction projects.
Key Coverage Areas of CAR Insurance
- Material Damage
Covers physical loss or damage to construction materials, equipment, and the project itself.
- Risks covered: Fire, explosions, floods, storms, and accidental damage.
- Example: If heavy rains during a construction project in Westlands lead to the partial collapse of a building, CAR Insurance covers repair costs.
- Third-Party Liability
Provides financial protection if construction activities cause injury or damage to third parties.
- Example: A passerby is injured at a site in Kilimani due to falling debris. The policy covers legal fees and compensation.
- Plant and Machinery
Covers construction equipment such as cranes, excavators, and bulldozers from accidental damage or theft while on-site. - Professional Indemnity (Optional)
Covers financial losses arising from design flaws, poor workmanship, or negligence. - Workmen’s Compensation
This coverage ensures compensation for injuries sustained by workers during the project. It can be bundled with CAR Insurance to meet Kenya’s labor laws.
Top CAR Insurance Providers in Kenya
Several leading underwriters in Kenya offer tailored CAR Insurance policies, including:
- Geminia Insurance: Known for competitive premiums and customised risk management services for contractors.
- Jubilee Insurance: Provides flexible CAR policies with add-ons such as professional indemnity and plant coverage.
- CIC Insurance: Offers CAR Insurance with bundled workmen’s compensation options.
- UAP Old Mutual: Focuses on large-scale infrastructure projects with extensive third-party liability coverage.
Step By Step Insurance Agency partners with these and other top underwriters to offer the best CAR Insurance solutions for construction projects of all sizes.
Why CAR Insurance Is Critical in Kenya
The construction sector in Kenya is subject to unpredictable risks such as theft, fire, and heavy rains. CAR Insurance provides peace of mind, financial stability, and compliance with requirements from government bodies and financial institutions.
Example:
A contractor working on a road in Naivasha experiences delays due to equipment theft. Without CAR Insurance, the contractor would face massive losses. With the right policy, the stolen equipment is replaced promptly, ensuring the project stays on track.
Factors Affecting CAR Insurance Costs in Kenya
The cost of premiums depends on several variables:
- Project value and size: Larger projects attract higher premiums.
- Location: Projects in flood-prone areas such as Budalangi may incur additional charges.
- Duration: The longer the project, the higher the premium.
- Machinery value: High-value equipment increases premium rates.
On average, CAR Insurance premiums range from 0.1% to 1% of the project value.
How to Choose the Right CAR Insurance Policy
- Partner with a Trusted Insurance Agency
Step By Step Insurance Agency collaborates with top underwriters like Geminia, Jubilee, CIC, and UAP Old Mutual to provide the best coverage. - Understand Policy Exclusions
Some policies exclude risks like poor workmanship or design flaws, unless additional coverage is included. - Compare Quotes
Always get multiple quotes to ensure you find a policy that fits your needs and budget. - Bundle with Other Coverage
Combining CAR Insurance with workmen’s compensation or plant insurance ensures comprehensive protection.
The Claims Process for CAR Insurance in Kenya
Filing a claim under CAR Insurance is simple if you follow the steps below:
- Notify the Insurer Immediately
Contact Step By Step Insurance Agency or your underwriter within 24 to 48 hours of the incident. - Collect Documentation
- Take photos of the damage.
- Submit a police report for theft or vandalism cases.
- Submit the Claim
Provide the required documentation, including incident reports and repair invoices. - Cooperate with the Adjuster
An insurance adjuster will assess the damage to validate the claim. - Receive Compensation
- Upon approval, the insurer will pay out compensation according to the policy terms.
Challenges with CAR Insurance in Kenya
Despite its benefits, CAR Insurance has some challenges:
- Delayed claims settlements due to incomplete documentation.
- High premiums for large infrastructure projects.
- Limited awareness about the importance of CAR Insurance among small contractors.
At Step By Step Insurance Agency, we provide personalised support to guide you through these challenges, ensuring you get timely claims processing and the best coverage options.
Conclusion: Build with Confidence Using CAR Insurance
CAR Insurance is an essential tool for safeguarding construction projects in Kenya. From material damage to third-party liability and equipment coverage, this policy offers comprehensive protection against risks that can delay or derail projects. With trusted underwriters like Geminia, Jubilee, CIC, and UAP Old Mutual , you can rest assured that your project is in good hands.
Whether you’re building residential homes in Karen or working on a road project in Thika, Step By Step Insurance Agency will help you find the right CAR Insurance solution. Don’t let unforeseen risks disrupt your progress—insure today and build with confidence.
Get Your CAR Insurance Policy Now!
Partner with Step By Step Insurance Agency to protect your construction investments from unexpected risks. Contact us today and let’s secure your project with the best CAR Insurance solutions.
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