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EXPORT RISK FOR EQUIPMENT MANUFACTURERS — TERRITORY, TRANSIT, INSTALLATION & CONTRACTS
Why Exporting Changes the Insurance Conversation
Exporting industrial equipment isn’t just “UK manufacturing with a foreign delivery address”. Once your product crosses borders, your risk profile changes in four big ways: territory & jurisdiction (where claims might be brought), transit & storage (ports, depots and multimodal carriage), installation/commissioning (site work, handover, testing), and contract exposure (warranties, SLAs, liability caps and consequential loss language).
A single export incident can trigger multiple sections: cargo damage leads to replacement costs, delayed commissioning causes contract penalties, and a fault in service can escalate into a products liability or professional indemnity allegation depending on whether the dispute is bodily injury/property damage or financial loss from performance/specification issues.
This page is a practical guide for equipment manufacturers who export — the covers typically needed, the key underwriting questions, and how to structure an insurer-friendly submission to get fast, competitive terms.
Common Export Risks for Equipment Manufacturers
Export underwriting is about clarity: where you sell, what you ship, how you ship it, and what you do on site. Below are the risk areas insurers focus on for international equipment manufacturing.
Territory & Jurisdiction
- Where products are sold/used and whether liability needs to be worldwide
- Local legal environments and defence costs (varies by territory)
- Distribution model: direct sales, agents, OEM supply, or local integrators
- After-sales service and who performs work on your behalf
Export policies must match reality. Misaligned territories are a common cause of delays at quote stage and problems at claim stage.
Transit, Storage & Packing Standards
- Single shipment value (peak exposure), split shipments and staged deliveries
- Multimodal transit: road, sea, air and inland haulage
- Storage at ports/depots and delays during customs handling
- Crating, shock protection, moisture control and documentation
Cargo losses are often about handling damage and packing. Underwriters want to understand how equipment is protected in real journeys.
Installation & Commissioning
- Site work activities: positioning, bolting, power connection, testing and handover
- Who controls the work: your engineers, subcontractors, or the customer’s team
- Tools and equipment off site; temporary works and site storage
- Defined acceptance testing and sign-off milestones
Many export disputes arise at commissioning. The cleanest programmes align liability territories and site-work declarations with your real scope.
Contract & Warranty Exposure
- Warranties, SLAs and performance guarantees
- Uncapped liabilities, “fitness for purpose” wording and broad indemnities
- Consequential loss language (downtime, lost production, penalties)
- Incoterms and when risk transfers between parties
Insurance doesn’t replace contract discipline. A contract review process is one of the best ways to reduce uninsured exposures.
The Export Equipment Manufacturer’s Insurance Checklist
Export programmes typically build on the normal manufacturing foundations (property, BI, liabilities), then add specialist covers that address overseas transit, site work and contract-driven exposures.
Foundation Covers
- Property – buildings, contents, plant, stock and work-in-progress (wording-dependent)
- Business Interruption – loss of gross profit and increased cost of working after insured damage
- Engineering / Machinery Breakdown – sudden failure of insured plant (plus optional breakdown BI)
- Employers’ Liability – employee injury/illness claims (where applicable)
- Public & Products Liability – third-party injury/property damage from operations/products
Export insurance is hard to place if the domestic foundations are weak. Accurate values and a clear process description matter.
Export & International Extensions
- Worldwide / Export Products Liability aligned to actual territories and end-use
- Marine Cargo / Goods in Transit for international shipments (single shipment values are critical)
- Contract Works / Erection All Risks where you control installation or staged assembly
- Tools & Equipment Away for overseas site work
- Professional Indemnity for design/specification/advice exposures and financial loss allegations
The key is matching cover triggers to real-world responsibilities: Incoterms, installation scope and handover points.
When Cyber & OT Matters in Export Projects
- Remote access for diagnostics and software updates
- Email compromise risk when paying overseas suppliers or freight forwarders
- Ransomware downtime impacting production and shipment schedules
- Data restoration, incident response and (where offered) cyber BI
Exporters often have more complex supply chains and payment flows, which can increase cyber exposure.
Directors’ & Governance Risks (Optional)
- Management decisions under contract pressure
- Supply chain disputes and contractual allegations against directors
- Regulatory investigations (scope varies by policy)
- Growth, acquisitions and overseas trading complexity
Not every manufacturer needs D&O, but export growth can increase governance complexity and claim frequency in some sectors.
The insurer didn’t just want turnover — they wanted our territories, Incoterms, max shipment value and where commissioning ended. Once Insure24 packaged the export story properly, we got cleaner worldwide liability terms and a cargo policy that matched how we actually ship.
Managing Director, Industrial Equipment ExporterHow to Build an Insurer-Friendly Export Manufacturing Submission
Export risks become expensive when details are vague. The faster your broker can answer the “export questions”, the faster you get terms — and the more competitive the market response tends to be.
Export Details Underwriters Usually Ask For
- Territories: countries/regions sold into, plus any excluded markets
- Turnover split: UK vs export and export by region where possible
- Max single machine value and max shipment value (peak exposure)
- Incoterms used and when risk transfers to the buyer
- Shipping methods: freight forwarders, containerised/breakbulk, air, road
- Installation/commissioning scope, duration and subcontractor use
- End-use & sectors: e.g., food, pharma, automotive, energy, defence, construction
- Claims history including transit losses, commissioning disputes or product issues
The “max value” questions are critical. Understated shipment values are a common reason policies fail to match the real exposure.
Controls That Often Improve Export Terms
- Contract review for liability caps, fitness for purpose and consequential loss
- Acceptance testing and sign-off documentation for commissioning
- Packing standards and documented crating/handling procedures
- Traceability: serial numbers, batch records, build documentation
- Supplier management: critical components, QC checks, change control
- Service procedures and remote access governance (where applicable)
Insurers price uncertainty. Controls reduce uncertainty — and are often the difference between “maybe” and “quoted”.
FREQUENTLY ASKED QUESTIONS
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Do I need worldwide products liability if I export equipment?
Usually, you need products liability that matches where your equipment is sold and used. Insurers will ask about territories,
end-use, distribution model, and whether you provide on-site commissioning. We’ll align the territory and activities with how you actually trade.
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What cover protects goods while shipping internationally?
Marine cargo (or international goods-in-transit, depending on journey) can cover loss or damage in transit subject to terms.
The key underwriting details are maximum single shipment value, packing standards, carriage method and Incoterms.
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We install and commission abroad — is that covered?
It can be, but the policy must reflect your scope: on-site work, tools away, contract works and the correct liability territory.
Insurers also like to see acceptance testing and a defined handover process to reduce disputes.
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How do Incoterms affect insurance?
Incoterms define when risk transfers between seller and buyer and who is responsible for carriage and insurance at each stage.
Your cargo and liability arrangements should match the point at which you still carry the risk, especially for staged deliveries.
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Can export contracts create uninsured exposure?
Yes. Consequential loss, uncapped liabilities, broad warranties and “fitness for purpose” clauses can create exposures
that standard policies may not respond to. A contract review process and sensible liability caps are essential alongside insurance.
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What information do insurers need for an export quote?
Territories, turnover split, maximum machine and shipment values, Incoterms, shipping methods, installation/commissioning scope,
end-use sectors and claims history. The clearer the export picture, the faster the quote and the cleaner the terms.
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Can this be combined with our factory/property programme?
Often yes. Many manufacturers place property, BI and liabilities under a combined policy, with marine cargo arranged alongside or separately
depending on shipment values and destinations. We’ll advise on the cleanest structure for your export profile.
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Do we need Professional Indemnity as well as products liability?
If you provide design, specifications, advice, calculations or performance guarantees, PI may be relevant for financial loss allegations.
Products liability is typically for injury/property damage claims. Many exporters carry both where they design and manufacture.