As soon as you have more than one machine on the schedule and staff operating them, plant and machinery insurance comes down to three things: who operates the machine, where it drives and at what value it has been declared.
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A premium indication, not personal advice. Prefer to talk it through? Call 072 - 509 24 56.
In brief
The insurance consists of two parts that you can choose separately. Liability covers what you cause to others with the machine and follows the liability under Article 6:162 of the Dutch Civil Code. Own-damage cover covers damage to and theft of the machine itself, with most insurers including inherent defect. For a business with several machines that is recorded on a single schedule of plant.
That schedule is the heart of the contract. If a machine goes onto the public road, the insurance obligation under Article 2 of the Dutch Motor Insurance Liability Act (WAM) applies and the item must actually have been declared as a motor vehicle. If the value is too low, a claim is settled proportionately under Article 7:960 of the Dutch Civil Code. Purchases and sales should therefore be on the schedule within the month.
The structure of the cover in three parts, with an overview per situation below.
Liability
Third-party liability for plant and machinery
Damage you cause to others with the machine.
Compulsory on public roads
Also during work
Cables and pipes separately
The machine itself
Own-damage cover
Damage to the machine, the body and the attachments.
Fire and storm
Theft from the site
Overturning and collision
Extensions
Extensions
What you add separately.
Inherent defect and machinery breakdown
Transport to the site
Hired plant
What is covered
Situation
Third-party liability for plant and machinery
Own-damage cover
Damage to a building or a parked car next to the site
Yes
No
Theft of the machine from the building site
No
Provided that
Fire and storm damage
No
Yes
Inherent defect in the hydraulics or the engine
No
Provided that
Damage to the item you are working on with the machine
No
No
Wear and deferred maintenance
No
No
Mobile plant is a motor vehicle within the meaning of the WAM and needs third-party liability insurance on public roads; non-mobile plant does not. Damage to cables and pipes is generally only covered if the excavation notification has been made and the trial trenches have been dug. The item you work on with the machine falls under the care, custody and control exclusion.
This overview is general in nature and is not personal advice. What is actually covered, including exclusions, limits and the excess, is set out in the policy conditions and the insurance card (verzekeringskaart) of the insurer; you receive both before you take out cover. Taking out cover without advice? Then read what execution only means for you.
Where things go wrong in practice
Four points that make the difference between a policy that pays out and one that does not.
Two insurance obligations that run into each other
As soon as a machine goes onto the public road, the insurance obligation under Article 2 of the Dutch Motor Insurance Liability Act (WAM) applies and the item has to be declared as a motor vehicle. If it stays on private ground, that obligation falls away but your liability does not. If a machine that has not been declared does go onto the road and injury results, that falls outside the policy and the Waarborgfonds Motorverkeer can recover the amount paid from you. Record for each machine which situation applies.
The schedule of plant determines what you get back
Insurers work with replacement value as new, replacement value or market value, and you only see that difference in a total loss. If a machine appears on the schedule at too low a value, the claim is settled proportionately; Article 7:960 of the Dutch Civil Code prohibits you from being better off, but neither does it protect you against your own declaration. Attached parts such as buckets, grabs, breakers and quick couplers are not automatically included and have to be declared separately.
Who operates the machine is a question of cover
For damage an employee causes to third parties with the machine, you are liable under Article 6:170 of the Dutch Civil Code; where a hired-in worker or a subcontractor is involved, Article 6:171 of the Dutch Civil Code comes into play. Policies require a demonstrably authorised and instructed operator. Keep records of certificates, instruction sessions and who is assigned to which machine; injury to your own employee does not fall under this but under public and employers' liability insurance.
What structurally falls outside own-damage cover
Wearing parts are insured nowhere: tracks, tyres, blades, teeth and cutting edges. Only sudden damage is covered, gradual deterioration is maintenance. Also excluded are: damage caused by deferred maintenance, intent and wilful recklessness under Article 7:952 of the Dutch Civil Code, and the loss from work standing still for as long as the machine is in the workshop. For that last item there is a separate extension for business interruption or hired plant.
Compact plant is stolen most often
Mini excavators, skid-steer loaders and plate compactors are light enough to be driven away on a trailer, and they can be used anywhere. At higher values insurers require a tracker and arrangements about storage outside working hours. Record serial numbers and mark the equipment; that helps both with recovery and with acceptance.
Downtime is a separate consideration
If your work stands still for as long as the machine is out of order, that loss is not covered under own-damage cover. Machinery breakdown cover with the business interruption extension, or cover for hired plant, absorbs that. For a business with one main machine that is often the difference between an annoying week and a loss-making quarter.
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When does the statutory insurance obligation apply to a machine?
As soon as the machine goes onto the public road or onto ground accessible to the public. It then falls under Article 2 WAM and has to be declared as a motor vehicle. If the machine stays exclusively on closed private ground, the obligation falls away, but your liability for damage to third parties continues in full.
What happens if the schedule of plant is not correct?
Where the declared value is too low, the claim is settled proportionately: you bear the part that was not insured. For machines you have sold but that are still on the schedule you pay premium unnecessarily. So update the schedule with every purchase or sale and report newly acquired attached parts with their value as well.
Who is liable if an employee causes damage while driving?
Your business. For mistakes by subordinates you are liable under Article 6:170 of the Dutch Civil Code, and for work you have carried out by a non-subordinate Article 6:171 DCC can apply. The insurer will also look at whether the operator was authorised and instructed; if that is demonstrably lacking, the cover comes under pressure.
Are wearing parts and inherent defect covered?
Wearing parts are not: tracks, tyres, blades and teeth wear through use and that is a business risk. Inherent defect, that is damage arising from within through a defective part or a short circuit, is covered by many own-damage policies, but not all. Check that with each insurer and note the exclusion for deferred maintenance, which often sits alongside it.
Finass Verzekert is a trading name of Finass Advies B.V. We advise on and arrange non-life insurance on the basis of an objective analysis of several insurers, and receive commission for this from the insurer, which is included in the premium. You pay no separate advice fee. Before you take out cover, we establish your wishes and needs.
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