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SPECIALIST INSURANCE FOR HIGH-ENERGY EAF STEEL OPERATIONS
Why Electric Arc Furnace (EAF) Steelmakers Need Specialist Cover
Electric Arc Furnace (EAF) steel manufacturing is a high-energy, high-temperature process with uniquely severe risk characteristics. The combination of molten metal, extreme electrical loads, oxygen and gas systems, scrap charging, refractory management, fume extraction, and heavy plant movement means a single incident can create major property damage, prolonged downtime, or significant injury exposure. Even when safety standards are strong, EAF operations are inherently complex - and insurers expect a specialist underwriting approach.
EAF sites can also face sharp business interruption exposures. Key equipment (transformers, furnace shell, electrode systems, hydraulics, water cooling, fume extraction, cranes, ladles, continuous casting links, and downstream rolling lines) can represent single points of failure. A breakdown or fire in one system can stop the entire melt shop, disrupt supply contracts, and create expensive recovery projects.
Insure24 arranges tailored EAF steel manufacturing insurance programmes that can combine property damage, machinery breakdown, business interruption, liability, environmental/pollution, goods in transit, and (where relevant) contractor and shutdown risks. We help you present your operation to underwriters in a way that improves capacity options, reduces restrictive terms, and supports more reliable claims outcomes.
CORE EAF STEEL RISK SECTIONS WE CAN ARRANGE
What This Page Covers
This page is written for EAF steel manufacturers and melt shops. It explains the main insurance sections, the risk drivers insurers focus on, common claim scenarios, and what information helps secure the strongest terms.
What Electric Arc Furnace (EAF) Steel Manufacturing Insurance Can Include
EAF operations usually require a bespoke programme rather than a “standard” manufacturing policy. Cover can be arranged as a package or as separate sections with specialist markets. The aim is to protect against both high-severity losses (fire, explosion, molten metal incidents) and high-impact operational disruptions (transformer failure, fume extraction breakdown, crane incidents, refractory failures and water leaks).
- Property damage: buildings, melt shop structures, plant rooms and electrical infrastructure
- Contents & stock: spares, consumables, electrodes, refractories, scrap and finished goods
- Machinery breakdown: sudden and unforeseen failure of insured machinery and electrical systems
- Boiler/pressure & mechanical sections: where pressure systems are present (policy dependent)
- Business interruption (BI): loss of gross profit/revenue following insured damage
- Increased cost of working: expedited recovery and alternative production arrangements
- Public & products liability: third-party injury/property damage arising from operations/products
- Employers’ liability: workplace injury and occupational illness claims
- Environmental/pollution liability: sudden/accidental pollution and clean-up costs (where arranged)
- Engineering inspections: statutory inspection support (as applicable)
- Transit & logistics: goods in transit, supplier/customer deliveries, and transport risks
- Contractors / shutdown works: major maintenance turnarounds and contractor exposures
Your programme should be structured around your true “maximum foreseeable loss” and your recovery timeline - not just the replacement cost of equipment.
Key EAF Risk Drivers Underwriters Focus On
EAF steelmaking risk is heavily influenced by process controls and the quality of maintenance and operating discipline. Insurers want to see that high-energy hazards are controlled through engineering design, procedural controls, and evidence-based maintenance. They also assess the severity potential: how quickly a loss could escalate, and how long recovery might take.
A strong underwriting submission for an EAF site includes clear information about the furnace configuration, transformer and electrical protection, cooling systems, refractory management, dust/fume extraction, scrap handling controls, and emergency response.
High-Energy / Electrical Risks
- Transformer and high-voltage system condition, protection and redundancy
- Arc stability controls, electrode management and consumption monitoring
- Switchgear maintenance, testing and thermal monitoring/inspection regimes
- Control systems resilience and spares strategy for critical electrical components
- Cabling routes, segregation, fire stopping and electrical room protection
Electrical failures can cause both fire damage and prolonged downtime due to long lead-time components.
Molten Metal, Water & Explosion Severity
- Water cooling systems: leak detection, maintenance, and emergency shutdown procedures
- Controls to prevent water contact with molten metal (high-severity incident driver)
- Ladle and tundish integrity, preheating controls and handling procedures
- Refractory management programme and lining inspection intervals
- Molten metal run-out and containment design
Underwriters often focus heavily on water management because water + molten metal incidents can be catastrophic.
Scrap Handling, Charging & Contamination
- Scrap yard controls, supplier vetting and inbound inspection processes
- Controls for sealed vessels, pressurised containers and hazardous contamination
- Charging procedures and operator competency
- Cranes, magnets and lifting equipment inspection and maintenance regimes
- Segregation of incompatible materials and documented rejection process
Scrap contamination can cause explosions, equipment damage and severe safety incidents - insurers will ask about controls.
Fume Extraction, Dust & Fire Spread
- Extraction system design, cleaning schedules and inspection documentation
- Baghouse/filters fire protection measures and isolation capability
- Spark detection and extinguishing systems (where fitted)
- Housekeeping standards and combustible accumulation prevention
- Fire detection and suppression in high-risk plant areas
Extraction and dust systems can be a critical fire risk - they also represent a single point of failure for continuous operation.
Common Insurance Claim Scenarios in EAF Steel Manufacturing
EAF losses can be high severity and complex to investigate. Claims often involve a combination of property damage and business interruption, and may also trigger liability or environmental costs depending on the incident. Below are examples of claim types insurers regularly consider when underwriting EAF operations.
Transformer / Electrical System Failures
- Transformer failure causing fire or smoke damage to electrical rooms
- Switchgear faults leading to arc flash incidents and shutdown
- Control system failures stopping furnace operation
- Long lead times for replacement parts causing extended BI
A strong spares strategy and condition monitoring can materially reduce BI severity and improve insurer confidence.
Molten Metal Incidents & Refractory Failures
- Refractory lining failure causing run-out and damage to furnace area
- Ladle/tundish failures causing spillage and structural damage
- Water contact incidents causing severe equipment damage and injury risk
- Heat damage to surrounding assets leading to wide-area property loss
Refractory management is both a safety and an insurance issue. Insurers will often ask about inspection intervals and controls.
Fume Extraction / Baghouse Fires
- Fire in extraction ducting or filters leading to significant smoke damage
- Suppression system activation and clean-up costs
- Loss of critical extraction causing operational shutdown
- Environmental reporting and clean-up requirements
Extraction system claims often combine property loss, BI, and potential environmental costs - making them a key underwriting focus.
Cranes, Lifting & Handling Incidents
- Overhead crane failures dropping loads and damaging equipment
- Magnet/lifting gear incidents during scrap charging
- Collision damage from mobile plant in tight operational areas
- Injury claims and production stoppage following incidents
Insurers look for statutory inspections, planned maintenance, and strong traffic management/segregation where plant is used.
What Underwriters Usually Need to Quote EAF Steel Operations
EAF underwriting is detail-driven. Providing a structured submission reduces delays, increases insurer appetite, and supports better terms. Insurers typically want a clear view of process flow, key equipment values, protective systems, and management controls.
Operational & Equipment Information
- EAF configuration, capacity and operating profile (number of melts, shift patterns)
- Key equipment list and values: transformer, furnace, extraction, cranes, compressors, cooling systems
- Utilities dependencies: power supply resilience and backup planning
- Spare parts strategy for long lead-time components
- Maintenance regime and inspection records for critical systems
Risk Management & Protection
- Fire detection and suppression: what’s protected and how (including electrical rooms)
- Water management and leak detection controls
- Refractory management programme and inspection approach
- Scrap acceptance controls and contamination prevention
- Emergency response plans and incident drill evidence
- Environmental permits and containment/clean-up arrangements
Insure24 helped us restructure our programme around the real downtime drivers - especially the transformer and extraction systems. The underwriting submission was clearer, we had more market options, and the final terms were more workable.
Plant Manager – EAF Steel ManufacturingPROTECT YOUR PLANT. PROTECT UPTIME. PROTECT CONTRACTS.
- Specialist EAF underwriting narrative and risk presentation
- Property, breakdown and BI structured around critical equipment
- Liability and environmental options to match operational exposure
- Support for insurer surveys, engineering recommendations and renewal strategy
- A programme designed to be claim-proof and contract-ready
FREQUENTLY ASKED QUESTIONS
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Why is EAF steel manufacturing considered high risk by insurers?
EAF operations combine extreme electrical loads, molten metal, scrap charging, refractory management, and complex cooling/extraction systems.
Losses can escalate quickly and cause major property damage and long downtime, so insurers require detailed risk controls and specialist underwriting.
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Does insurance cover transformer failures and electrical breakdown?
Transformer and electrical system failures may be covered under machinery breakdown/engineering sections, subject to policy terms, maintenance requirements,
and defined insured perils. These failures can also trigger business interruption cover if linked to insured damage.
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Is business interruption (BI) important for EAF steelmakers?
Yes. Downtime costs can exceed repair costs, especially where long lead-time components are involved. BI can cover loss of gross profit/revenue
following insured damage, and can be structured with increased cost of working to support faster recovery (subject to terms).
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Can EAF insurance include environmental or pollution cover?
Environmental/pollution liability can often be arranged to cover sudden and accidental pollution incidents, clean-up costs and third-party claims,
subject to policy structure, permits and site controls.
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What information helps get the best EAF insurance terms?
Insurers typically want equipment values, process flow and operating profile, maintenance and inspection regimes, protection systems (fire, electrical),
water management controls, refractory programme details, scrap acceptance controls, and emergency response documentation.
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Can Insure24 arrange a combined programme for EAF steel manufacturing?
Yes. We can structure EAF programmes that combine property, machinery breakdown, business interruption, liability, environmental, transit and other sections,
aligned to your operations, contracts and recovery priorities.