What are the DE Clauses in Project Policies?
[lwptoc]
Design Engineering (DE) Clauses in Contractor’s All Risk policy are one of the important clauses of Project Insurance policy.
Basically, there are 05 types of Design Engineering clauses which is known as DE1, DE2, DE3, DE4, & DE5.
In India normally policies are issued with DE4, let us now discuss all these clauses along with the DE5 clause.
DE Clause 1
Excludes all damages due to design defect
DE Clause 2
Permits cover the damage to the property of the insured(which does not rely upon the defective property for support) surrounding the defective property
DE Clause 3
Permits cover for the damage to all insured’s surrounding property whether relying upon the defective property for support or not.
DE Clause 4
Similar to DE3 but is intended to apply in respect of machinery rather than Building work.
DE Clause 5
Covers the damaged property also along with the coverage available in DE2 and DE3. But excludes any cost incurred for the betterment of the defective item or improvement in the specification of the defective property.
In India normally policies are issued having coverage with DE Clause 3 or DE Clause 4.
