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Your Complete Insurance Sense-Check for Engineering Businesses
Engineering and metal manufacturing businesses face a unique blend of risks: heavy machinery, worker injury exposure, defective part claims, contract liabilities, fire and property damage, mobile plant, tools on the move, and supply chain disruption.
This checklist helps you step back and ask: Are we properly insured — and are our limits, wording and declarations aligned with how we actually operate?
Use this page as an internal audit tool with your operations, finance and H&S leads. If any section raises uncertainty, we can review your current programme and identify practical improvements.
1️⃣ Employers’ & Public Liability
Start with your core liability structure. Most serious financial losses in engineering arise from injury claims.
Employers’ Liability (EL)
- Do we employ staff (including apprentices and temps)?
- Are labour-only subcontractors correctly declared?
- Is our wage roll accurate and up to date?
- Have we reviewed our claims history and near misses?
- Do we operate hazardous machinery (presses, CNC, rollers, robotic cells)?
Public & Products Liability
- What liability limit do our customers require (£5m, £10m+)?
- Do we export outside the UK (especially USA/Canada)?
- What is the worst-case failure scenario of our product?
- Do we supply safety-critical components?
- Are contract indemnities aligned with our insurance?
🔎 Red flag: If your contract liabilities exceed your insurance limits, or if you assume “consequential loss” responsibility that isn’t insured.
2️⃣ Property, Machinery & Stock
Engineering businesses are asset-heavy. Underinsurance is common — especially after equipment upgrades or expansion.
Buildings & Improvements
- Are buildings insured at full rebuild cost (not market value)?
- Have we included tenants’ improvements?
- Have we factored in inflation since last valuation?
- Do we have fire protections appropriate for hot work?
Machinery & CNC Equipment
- Are machines insured at replacement cost (incl. install & freight)?
- Do we have Machinery Breakdown cover?
- Have we considered expediting expenses?
- Are older machines still correctly valued?
Stock & Work in Progress (WIP)
- What is our peak stock level during busy periods?
- Are customer-owned materials included?
- Do we hold high-value alloys or specialist materials?
- Is underinsurance likely if demand spikes?
Business Interruption (BI)
- Is our indemnity period long enough (12, 24, 36 months)?
- Have we included increased cost of working?
- What would realistically happen after a total loss?
- Do we rely on one key production line?
3️⃣ Tools, Mobile Plant & Transit
- Do we move tools between sites or leave them in vehicles overnight?
- Are “any one vehicle” and “any one item” limits realistic?
- Is owned mobile plant correctly scheduled?
- Do we hire in plant — and who is responsible under contract?
- Do we ship high-value components via courier?
- Are customer goods in our custody declared?
🔎 Red flag: Theft from vehicles often fails where security conditions aren’t met. Make sure your wording matches real behaviour.
4️⃣ Supply Chain & Contract Risk
- Do we rely on single-source suppliers?
- Would supplier fire/flood shut us down?
- Have we explored contingent BI extensions?
- Are penalty clauses in customer contracts insurable?
- Have we mapped “single points of failure”?
- Do we hold enough safety stock for critical inputs?
5️⃣ Design, Advice & Professional Exposure
- Do we provide drawings, design input or value engineering?
- Do we specify materials or tolerances?
- Could we face financial loss claims without property damage?
- Do we need Professional Indemnity (PI)?
- Do we need Product Recall cover?
- Are we exposed to cyber risk via connected machinery?
“We thought we were fully covered — until we worked through the checklist and realised our stock peaks, subcontractor declarations and transit limits were out of date. The review gave us clarity and confidence.”
Finance Director, UK Precision Engineering FirmCALL FOR EXPERT ADVICE
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FREQUENTLY ASKED QUESTIONS
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How often should we review our engineering insurance programme?
At least annually — and immediately after major equipment purchases, new contracts, expansion, export changes, or workforce increases.
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What is the most common gap in engineering insurance?
Underinsurance on machinery and stock, incorrect subcontractor declarations, unrealistic transit limits, and contract liabilities exceeding policy limits are common gaps.
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Do we need Professional Indemnity as a manufacturer?
If you provide design, technical advice, drawings or specification input, PI may be appropriate — especially where financial loss claims could arise without physical damage.
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Can insurance cover supply chain disruption?
Usually only where disruption follows insured damage (e.g., contingent BI for named suppliers). Pure shortages or price increases are typically not insured.
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How can Insure24 help?
We review your contracts, operations, machinery values, workforce structure and supply chain exposure — then structure an insurance programme aligned with how you actually operate, not just your renewal paperwork.