What Is Equipment Rental Insurance?

As part of the lease contract, lease insurance is a form of default insurance. When the lessee fails to continue to pay the rent as required by the contract, the lessee can obtain the amount due from the insurance company.

Lease insurance

In modern leasing business, leasing insurance has very important practical significance both from a macro perspective and a micro perspective.

1. Ensure the normal operation and balanced development of the social economy. For enterprises, various natural disasters and accidents will cause the normal production and operation of the enterprise to be interrupted and cause economic losses. It will also cause collateral losses to upstream and downstream enterprises and related industries. Therefore, through insurance compensation, the timely purchase of damaged equipment by enterprises can not only help the disaster-stricken enterprises to resume normal production and operation, but also promote the balanced development of social reproduction.

2. Conducive to foreign economic and trade development. Insurance is an essential link in international leasing business. The development of foreign-related insurance business has effectively promoted foreign economic trade and ensured international economic exchanges.

3 Promote fair competition among enterprises. Businesses face various risks, and the existence of risks will hinder free competition in the market. Whether in different industries or within the same industry, the risks and damages encountered by various operations are different, so it is difficult to carry out fair competition based on operating efficiency. Through insurance, many uncertain factors can be eliminated, and the competition of enterprises tends to be reasonable and fair.

Modern leasing insurance mainly involves leasing goods transportation insurance and leasing property insurance during the leasing period. Rental insurance is divided into international transportation cargo insurance and domestic transportation cargo insurance.

I. Types of transportation insurance for leased items

Due to different modes of transportation, cargo transportation insurance can be divided into marine transportation cargo insurance, land transportation cargo insurance, air transportation cargo insurance, postal package cargo insurance and international multimodal transportation insurance. The first three types of insurance are mainly introduced.

(I) Cargo insurance by sea

The insurance clauses for maritime transport cargoes are usually made by the insurance companies themselves. Generally includes basic insurance and additional insurance, which includes safety insurance, water damage insurance and all risks.

1. Ping An Insurance. The coverage of Ping An Insurance mainly includes the following aspects:

(1) During the transportation of the insured goods, due to severe weather, lightning, tsunami, earthquakes, floods and other natural disasters, the entire batch of goods is estimated to be totally or presumably totally lost.

(2) All or part of the loss of the cargo due to the grounding, reefing, sinking, collision, collision with drift ice or other objects, and fire, explosion and other accidents.

(3) In the case of accidents such as grounding, reefing, sinking, and incineration of transportation vehicles, the cargo suffered partial damage caused by natural disasters such as severe weather, lightning, and tsunami at sea before and after.

(4) During loading or unloading or transshipment, all or part of the loss caused by the landing of one or more whole cargoes.

(5) Reasonable expenses paid by the insured for measures to rescue, prevent or reduce damage to the goods that are in danger under the insured liability, but not more than the insurance amount of the rescued goods.

(6) Special expenses incurred at the port of refuge for unloading, storage, and transportation of goods after a shipwreck.

(7) The costs of sacrifice, sharing and rescue of general average.

2. Water damage insurance. In addition to the liabilities of Ping An Insurance, the scope of water damage insurance coverage is also responsible for the loss of the insured cargo due to natural disasters such as severe weather, lightning, tsunami, earthquakes, floods and other natural disasters. WPA's insurance liability is greater than Ping An. Therefore, the rate of WPA is higher than Ping An.

3 All Risks. In addition to all the liabilities of safety insurance and water damage insurance, the insurance liability of all risks also includes all or part of the losses caused by various external causes during the carriage of the insured goods at sea. The "foreign causes" referred to here are not all external risks during transportation, but are limited to risks in general additional risks. For the three basic types of insurance mentioned above, the insurance company has the following exclusions:

(1) losses caused by the intentional act or fault of the policyholder;

(2) Loss caused by the shipper's liability;

(3) Loss caused by the poor quality or short quantity of the insured goods before the insurance liability begins;

(4) loss or expense caused by the natural loss, essential defects, characteristics of the insured goods, market price drop, or delay in transportation;

(5) Cargo damages that fall into the insurance liabilities and exclusions stipulated in the war risk clauses and strike insurance clauses.

4 Additional risks. The additional insurance for marine transportation cargo insurance can be divided into general additional insurance, special additional insurance and special additional insurance. It cannot be insured separately, and must be insured on the basis of Ping An or WPA; if all risks have been insured, there is no need to add additional general insurance.

(1) General additional insurance. General additional insurance is also called ordinary additional insurance, which covers the loss of goods caused by general external reasons. It includes theft and pick-up insurance, freshwater rain insurance, short-term insurance, miscellaneous and contamination insurance, leakage insurance, damage and fragmentation insurance, moisture and heat insurance, hook damage insurance, packaging breakage insurance, rust damage insurance, and string smell insurance .

(2) Special additional risks. Special additional risks are not included in the scope of all risks and they are often associated with politics, state administration, and some special risks. It includes under-delivery insurance, import tariff insurance, deck insurance, refusal insurance, aspergillus flavus (toxic) insurance, and export cargo storage fire insurance.

(3) Special additional risks. Special additional risks are not included in the scope of all risks. The risks it covers are mainly war risks and strike risks.

(2) Cargo insurance for land transportation

Land transportation cargo insurance includes land transportation insurance, land transportation all risks, and land transportation cargo war risks. Land transportation insurance and land transportation all risks are basic risks. Land transportation cargo war risks are additional risks. Covered by train and car transport.

1. Land transportation insurance. The insurance liability of land transportation insurance is similar to that of water damage insurance in marine transportation cargo insurance. The insurer is responsible for compensating for natural disasters such as storms, lightning, floods, earthquakes, etc. during the transportation of the insured goods, or collision due to transportation means. , Overturning, derailment, or all or part of the loss caused by the barge being stranded, rocked, sunk, bumped, or caused by a tunnel collapse, cliff collapse or fire, explosion, etc. during the use of a barge; Reasonable expenses paid by the insurer for rescue, prevention or reduction of cargo damage to the goods subject to the insurance risk, but such compensation shall not exceed the insurance amount of the rescued cargo.

2. All risks by land transport. In addition to the liability for land transportation insurance, the insurance liability for all risks of land transportation is also responsible for all or part of the loss of the insured goods due to external reasons during transportation. The exclusion of land transportation insurance and all risks of land transportation insurance is the same as the exclusion of marine transportation cargo insurance.

3 Cargo war risk by land. Land transportation cargo war risk is an additional risk of land transportation cargo insurance. It can be insured only after the insurer and the insurer have reached consensus on the basis of insured land transportation insurance or all land transportation insurance. Some foreign insurance companies do not provide coverage, and China's coverage is limited to train transportation. The insurance liability for land transportation cargo war risks is mainly the loss of cargo caused by war, war-like behaviors, hostilities and armed conflicts and various conventional weapons (including landmines and bombs) during the transportation of trains. The exclusions of war risks for land transportation of goods include: losses and costs caused by the use of atomic or thermonuclear weapons as a result of hostilities; loss of covered transportation goods caused by the seizure or detention of governors, authorities or other armed groups or ( And) loss caused by obstruction.

(3) Cargo insurance by air

Air transport cargo insurance includes air transport insurance and air transport all risks.

1. Air transportation insurance. The insurance liability of air transportation insurance is that the insurer is responsible for compensating the insured cargo for lightning strikes, fires, explosions during the air transportation, or being abandoned due to the severe weather or other disasters of the aircraft, or being impacted, capsized, dropped or missing due to the aircraft All or part of the damage caused by the accident. In addition, the insurer is also responsible for the reasonable expenses paid by the insured for measures to rescue, prevent or reduce damage to the goods that are in danger within the scope of the insurance liability, but not to exceed the amount of insurance for the batch of rescued goods.

2. All risks of air transport. In addition to all the risks of air transportation, the insurer is also responsible for all or part of the loss of the insured cargo due to external reasons.

Insurance of leased items during the lease period

(I) Insurance concept of leased items during the lease period

Insurance of leased items during the lease term means that the lessee and the lessor choose the appropriate insurance according to the specific needs of the leased item. The insurance clauses of the lease contract specify the types of insurance that will be insured during the lease period. Apply for insurance in the name of a person. The insurance period is divided into annual insurance or one-time insurance based on the lease term.

(II) Types of leased property insurance during the lease period

1. property insurance. Property insurance is usually an insurance item handled by the lessee in the name of the lessor when the leased property is installed and completed. Basic insurance and comprehensive insurance of property insurance are the most commonly used types of insurance for corporate property insurance.

(1) The basic insurance coverage of property insurance includes fire, explosion, lightning strikes, the fall of flying objects and other airborne objects, power outages (water and gas outages) caused by disasters and accidents, the loss of the insurance subject caused by rescue, Necessary and reasonable expenses. After the insurance company underwrites the basic insurance, it can specifically cover additional risks, such as storms, heavy rains, robberies, snow disasters, ice, landslides, cliff collapses, sudden landslides, hail disasters, plumbing bursts, destructive earthquakes, etc. The exclusions of property insurance basic insurance are:

War, hostilities, military operations, armed conflicts, strikes, riots, losses due to intentional acts or pampering;

Indirect losses caused by insurance incidents such as nuclear reaction (nuclear radiation, radioactivity) pollution, earthquake, torrential rain, flood, typhoon, storm, tornado, snow, hail, debris flow, cliff collapse, landslide, plumbing burst, robbery, theft, etc .;

Damages caused by the defects of the insurance subject itself and improper storage;

Loss due to administrative or law enforcement.

(2) The insurance coverage of the property insurance comprehensive insurance covers rainstorm, flood, typhoon, storm, tornado, hurricane, snowstorm, hailstorm, mudslide, cliff collapse, sudden landslide, sudden ground collapse, volcanic eruption, etc. After the insurance company underwrites the comprehensive insurance, it can specifically underwrite additional risks, such as underground property insurance, open property insurance, theft insurance, machinery damage insurance, and business interruption insurance. Other liabilities include insurance for bursts of water tanks and water pipes, and liability for damage caused by pollution caused by natural disasters or accidents. Excluded liability for comprehensive insurance for property insurance is damage caused by a storm or rain caused by an earthquake, insured objects stacked in the open air or under a shelter.

2. Risk of machine damage. The scope of the machine damage insurance cover includes errors in design, manufacture or installation, defects in casting and raw materials, errors in operation by workers or technicians (lack of experience, poor technology, negligence, negligence, malicious behavior), breakage caused by centrifugal force, overload (overvoltage , Wire hitting, arc, leakage, short circuit, atmospheric discharge, induced electricity, etc.). Property insurance basic and comprehensive insurance do not cover the above risks. In order to obtain comprehensive protection, lease insurance should generally add machine damage insurance when applying for basic or comprehensive insurance for property insurance. The exclusions for machine damage insurance are:

(1) Physical or chemical reactions caused by the operation of machinery and equipment, various consumables and consumables, and losses caused by the insured and its representatives on the known leased property before insurance;

(2) losses that are liable to third parties under the law or the contract;

(3) Power outages (gas outages, water outages) caused by non-accidents, intentional acts or gross negligence of the insured and their representatives, war (hostilities, armed conflict, terrorist activity, coups, rebellions, strikes, riots and riots ), Administrative or law enforcement actions;

(4) Indirect losses caused by nuclear reaction (nuclear radiation, radioactive) pollution and insured accidents;

(5) Expenses, natural disasters and general accidents borne by the insured as stipulated in the insurance contract.

3 Installation works all risks. The insurance coverage of all risks of installation works includes natural disasters, general accidents, theft, lack of experience of workers or technicians (negligence, negligence, malicious behavior), accidents caused by defective raw materials or poor workmanship, etc. The exclusion liability for all risks of installation works are:

(1) Loss caused by intentional acts or gross negligence of the insured and his representative;

(2) losses caused by war (hostilities, armed conflicts, terrorist activities, coups, rebellions, strikes, riots and riots), administrative or law enforcement actions;

(3) Damage caused by nuclear reaction (nuclear radiation, radioactivity) pollution, natural wear (oxidation, rust), and incorrect design;

(4) Accidents caused by defects in raw materials or inadequate workmanship, damage or failure not caused by external forces, and losses caused by complete or partial shutdown;

(5) fines and delay losses;

(6) Loss of contract and related materials;

(7) Expenses borne by the insured as stipulated in the insurance contract, shortages of inventory of leased items, and the scope and exclusion of liability specified in the third party liability insurance clause of the installation project.

The claim of lease insurance is an important part of fulfilling the insurance contract, and it is a concrete embodiment of the realization of insurance rights by the insured. The claim should be requested within the validity period and follow the specific procedures of the claim.

(A) the concept of claims

An insurance claim refers to the requirement that the insured submit a claim for compensation to the insurer in accordance with the relevant provisions of the insurance contract if the subject matter of the insurance falls within the scope of the insurance liability during the validity period of the insurance liability. When the leased property suffers a loss as stipulated in the insurance contract, the lessee shall promptly make a claim to avoid losing the time limit for claim. According to relevant regulations, for the transportation insurance of leased items, the time limit for claims is generally within two years after the loss of the leased items falls within the scope of insurance liability; for the insurance of leased items during the lease period, the period of claims generally falls within the insurance liability Within one year after the loss. If there are objective reasons affecting the lessee's claim, the claim period may be extended appropriately.

(2) Procedures for claims

The insured (ie the lessee) should make the following procedures when claiming:

1. Notice of loss. When the lessee finds that the leased property has suffered a disaster loss, it shall promptly notify the insurance company, explain the time, place, cause and process of the damage, and ask the insurance company to send someone to deal with it.

2. Rescue measures. After an insured accident occurs, the lessee shall take necessary measures to rescue and reduce the loss to the minimum extent; if the lessee delays the rescue time or does not rescue, the insurance company has the right to refuse compensation.

3 Accept survey. After the insurance is released, the lessee has the responsibility to protect the scene and cooperate with the insurance company to do the survey work so that the insurance company can quickly and accurately perform the compensation work.

4. Fill out the risk notification. The lessee carefully fills out the "Notice of Risk" in accordance with the requirements of the insurance company, including the name of the leased item, the amount of insurance, the insurance policy number, the date of the risk, the reason for the risk, the risk, the degree of loss, and the amount of compensation required.

5. Provide claim documents. The purpose is to prove the facts of the lessee's claim. The main claim documents are:

(1) Insurance policy and proof of payment of insurance premiums;

(2) Leases account books, invoices, import and export tariffs, etc., if in transit, you need a waybill, bill of lading, packing list, transportation contract, etc .;

(3) The risk investigation report and certificate of risk, if in transit, also need to be provided by the carrier, the customs or the port authority for a certificate of damage or loss of goods or a certificate of loss identification;

(4) A list of damaged property and expenses, if a third party liability is involved, a recovery letter and other relevant documents are required;

(5) Rescue cost documents.

6. Receive compensation or insurance money. Upon receiving the above-mentioned claim document, the insurance company shall quickly determine whether compensation should be made according to the scope of insurance liability; once the compensation amount is determined, the insurance company shall pay within ten days.

7. Issue a letter of transfer of equity. When a third party liability is involved, and after the lessor has been paid in advance by the insurance company, the lessor issues an equity transfer letter to the insurance company.

The claim for lease insurance is the whole process of fulfilling its obligations by the insurance company, and following the specific procedures for claim settlement, economic compensation will be provided to the insured (ie the lessor) who has suffered losses.

(A) the concept of claims

Insurance claim refers to the investigation and compensation of property losses incurred by the insurer under the insurance subject that the insurer underwrites, and the insurant submits a claim according to law according to the insurance contract signed by the two parties.

(B) the principle of claim settlement

In leasing insurance claims, insurance companies should adhere to the following two principles:

1. The principle of observing contracts and keeping promises. An insurance company shall strictly perform its liability for compensation in strict accordance with the provisions of the insurance contract.

2. Proactive, rapid, accurate and reasonable. After the insurance is released, the insurance company shall take the initiative to settle claims, pay in time according to the time limit stipulated in the insurance contract, and accurately calculate the amount of compensation.

(III) General procedures for claim settlement

1. Filing investigation. After receiving the notice of danger, the insurance company shall immediately check the corresponding insurance policy and put on record, and quickly dispatch personnel to the site of the danger to conduct on-site investigation, understand and record the loss in detail, and analyze the cause of the loss.

2. Accountability review. The insurance company strictly inspects the scope of insurance liability and compensation according to the records of on-site investigations and claims documents.

3 Compensation payments. The insurance company verified that the cause of the loss is indeed within the scope of insurance liability. It should explain the loss of the leased property, the rescue situation and the various expenses item by item, calculate the amount of loss, and calculate the amount of compensation. Pay within days.

4 Residual loss processing. After the compensation is paid, if the damaged leased item has a residual value, the insurance company has the right to deal with it; in this way, the expenses of the insurance company can be reduced, and the damaged leased item can be fully utilized. Usually the insurance company deducts the discount from the insurance compensation amount. If the cause of the loss is the responsibility of a third party, the insurance company has the right to claim compensation from the third party after performing the compensation, and the policyholder shall actively assist.

5. Insurance Commission. It applies to marine transportation insurance. When the leased property is severely damaged and the total loss is presumed, the lessor may apply for transferring the leased property to the insurance company, that is, issue the "Notice of Application for Insurance Commission Payment", and pay the entire amount after the insurance company agrees. The company issues a power of attorney.