Moving a factory is one of the highest-risk periods in the life of a business. You’re not only transporting expensive machinery—you’re disconnecting, lifting, shifting, re-installing, re-commissioning, and often modifying systems under time pressure.
That mix of heavy engineering work, multiple contractors, and tight deadlines creates a perfect storm of exposures: accidental damage, breakdown during testing, third-party injury, property damage at both sites, delays, and contractual disputes.
That’s where construction engineering insurance and machinery movement insurance planning come in. The goal isn’t “buy a policy and hope.” It’s to build an insurance plan that matches the method statement, the equipment values, the project timeline, and the contract structure.
This guide breaks down the risks, the cover types, and a practical planning checklist so you can move machinery with confidence.
“Machinery movement insurance” is often used as a catch-all phrase. In practice, it usually refers to one (or a blend) of the following covers:
Erection All Risks (EAR) or Contractors’ All Risks (CAR) extensions for dismantling, transit, installation, and testing
Marine cargo / transit insurance for the transport leg
Contract works insurance for temporary works, rigging, and installation activities
Machinery breakdown / engineering inspection for commissioning and operational testing
It’s not the same as:
A standard property policy (which may exclude “in transit” and “work being performed”)
A haulier’s limited liability (which is not full-value insurance)
A generic “goods in transit” policy that doesn’t contemplate lifting, jacking, skidding, or commissioning
The right solution depends on the scope: are you moving a single machine, a production line, or an entire plant including utilities, racking, and control systems?
Factory moves sit at the intersection of construction, engineering, and logistics. That means the risk profile changes by phase:
Decommissioning & isolation (electrical, gas, steam, hydraulics)
Dismantling (mechanical separation, removal of guarding, disconnection of services)
Lifting & handling (cranes, forklifts, gantries, skates, jacks)
Transit (road risk, loading/unloading, route constraints)
Installation & alignment (foundations, grouting, levelling, coupling)
Commissioning & testing (start-up risk, calibration, trial runs)
Construction engineering insurance is designed to respond to accidental physical loss or damage during these phases—when standard policies often have exclusions.
Here are the exposures insurers and loss adjusters see repeatedly in factory relocations.
Dropped loads
Sling failure or incorrect rigging
Forklift impacts
Skidding/jacking failures
Even minor damage can be catastrophic if it affects precision components, bearings, control panels, or alignment.
Incorrect disconnection (hydraulics, coolant, compressed air)
Contamination (dust, moisture ingress)
Missing parts and poor labelling
Incorrect reassembly
Low bridges, weight restrictions, road vibration
Poor packaging or inadequate securing
Weather exposure during loading/unloading
Electrical faults on energisation
Overheating, lubrication failure
Control system errors
Damage during trial runs
This is where the difference between “transit cover” and “engineering cover with testing” becomes critical.
Damage to landlord property at the old site
Damage to the new premises during installation
Injury to visitors or other contractors
A move can be “successful” operationally but still financially painful if it causes:
Extended downtime
Missed delivery deadlines
Contractual penalties
Loss of key customers
Insurance can sometimes help here—but only if the right cover is arranged.
A strong machinery movement insurance plan typically combines multiple covers. Below are the most common building blocks.
Best for: dismantling, installation, and engineering works.
Covers accidental physical loss or damage to contract works
Often includes tools, temporary works, and on-site storage
Can be arranged by the principal (project owner) or the contractor
Key point: EAR is often more suitable when the project is primarily mechanical/electrical installation rather than building works.
Best for: the transport leg between sites.
Covers loss/damage while in transit
Can include loading/unloading and temporary storage
Can be written on “all risks” terms (subject to exclusions)
Key point: don’t rely on the haulier’s liability. Liability is not the same as insurance for your full financial exposure.
Best for: injury and third-party property damage.
Public liability covers third-party bodily injury and property damage arising from the works
Employers’ liability covers injury to employees (UK legal requirement)
Key point: confirm who is responsible contractually—principal, main contractor, or specialist mover.
Best for: engineering design, method statements, lift plans, or project management advice.
If an engineering firm is designing foundations, specifying lifting points, or advising on safe systems of work, PI may be relevant.
Best for: commissioning and operational testing.
Covers sudden and unforeseen mechanical/electrical breakdown (depending on policy)
May include inspection requirements for pressure systems, lifting equipment, etc.
Key point: some project policies can extend into testing/commissioning, but the definitions and time limits matter.
Best for: large moves where downtime is a major financial risk.
Covers financial loss due to delay caused by insured physical damage
Often requires strong project controls and clear critical path planning
Key point: DSU is not a simple add-on; it’s underwritten carefully and needs accurate financial data.
There are two common approaches:
Principal-arranged project policy: the factory owner buys a project policy covering the works and names contractors.
Contractor-arranged cover: each contractor relies on their own CAR/EAR and liability policies.
In practice, many projects use a hybrid. The key is to avoid gaps and disputes over “whose policy should respond.”
Ask for a clear insurance responsibility matrix in the contract pack:
What is insured (equipment, temporary works, existing property)
Where it is insured (old site, transit, new site)
Who insures it (principal vs contractor)
Policy limits, deductibles, and key exclusions
Two policies can look similar on a schedule but behave very differently at claim time. These are the details to focus on.
Replacement cost vs market value
Inclusion of freight, duties, installation, calibration
Correct values for high-value components (CNC spindles, control cabinets, robotics)
Underinsurance can trigger average clauses, reducing claim payments.
When does “testing” start?
Is hot testing covered?
Is there a time limit (e.g., 14/30 days) after completion?
If you’re installing machinery into an existing building, confirm cover for:
Damage to the building and fixed services
Damage to existing plant not part of the move
Moves often involve temporary storage. Confirm:
Locations covered
Security requirements
Maximum duration
Common exclusions that can catch factory moves include:
Gradual deterioration, wear and tear
Faulty workmanship/design (and whether resultant damage is covered)
Electrical/mechanical derangement without physical damage
Unexplained disappearance
Inadequate packing or securing
Some policies apply different deductibles for:
Theft
Water damage
Transit losses
Testing/commissioning
Make sure the deductible is realistic for your risk appetite.
The best insurance outcomes start with strong controls. Underwriters typically look for evidence of:
A detailed method statement and lift plan
Named competent contractors (riggers, crane operators, electricians)
Machinery condition reports before dismantling
Photographic records and serial number lists
Proper packing, crating, and moisture protection
Route surveys for abnormal loads
Clear commissioning plan and OEM involvement where needed
If you can show these, you’ll usually get better terms—and fewer claim disputes.
Use this as a practical workflow.
Document:
What is being moved (machine list)
Where it is now and where it’s going
Who is doing what (principal, main contractor, specialist movers)
Timeline and critical path
For each item:
Description, make/model, serial number
Replacement cost (including installation)
Weight and dimensions
Special handling requirements
Flag items/activities like:
Single lifts over a certain tonnage
Tight access lifts
Complex disassembly (robotic cells, clean rooms)
High-voltage energisation
Check:
Who bears risk of loss/damage at each stage
Indemnities and hold harmless clauses
Insurance requirements and minimum limits
Decide whether you need:
A project EAR/CAR policy
Separate transit insurance
DSU/ALOP for downtime exposure
Extensions for existing property
Define:
When cover attaches (collection? dismantling start?)
When cover ends (handover? completion? after testing?)
Make sure you can comply with:
Security requirements
Hot works permits
Storage conditions
Maintenance/inspection obligations
If something goes wrong, you’ll want:
Pre-move condition reports
Photos/videos of packing and loading
Delivery notes and exception reports
Commissioning logs
A manufacturer relocates a CNC line from one UK site to another. The line includes:
CNC machines
Tool changers and coolant systems
Control cabinets and networked monitoring
Overhead extraction and compressed air
Key insurance considerations:
EAR cover for dismantling, installation, and alignment
Transit cover for road movement and loading/unloading
Testing cover for recommissioning, including trial runs
Existing property extension for damage to the new building during installation
Liability cover for third-party injury and property damage
Without this structure, a loss during commissioning could fall between “transit ended” and “property cover resumed.”
Usually not fully. Property policies often exclude transit and may exclude damage while work is being performed. You typically need project and/or transit cover designed for the move.
They may be liable, but liability is often limited by contract and law. That may be far less than the replacement cost of specialist machinery.
Often yes—either as part of EAR/CAR or via specialist extensions. Lifting and handling is a major loss driver and should be explicitly contemplated.
Contractors usually insure hired-in plant under their own policies, but check contracts carefully. If you’re hiring directly, you may need hired-in plant cover.
Potentially, via DSU/ALOP, but it typically only responds when delay is caused by insured physical damage. It needs careful underwriting.
Factory moves are complex, and insurance needs to match the engineering reality. Insure24 can help you:
Review your move plan and identify coverage gaps
Arrange appropriate construction engineering and transit cover
Align policy wording with your contracts and project phases
Make sure testing/commissioning is properly addressed
If you’re planning a factory move or relocating high-value machinery, speak to a specialist before work starts. A short insurance review now can prevent expensive gaps later.
Get a quote or advice from Insure24:
Call 0330 127 2333
Or request a quote via insure24.co.uk
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