Onshore Energy Conference — Dubai Onshore Energy Conference — Dubai 02 | Page 37

INSURANCE MATTERS
somewhere in the future, there is damage then
the utility will invariably insert a mid-point
joint to minimise their own costs of repair.
Nevertheless, ultimately the Contractor
will come back to his Contractual obligations
to replace as per contract design. (The cable
section can be sold for scrap where there is
some offset for the copper recovery). Some
Insurers acknowledge that the Contractor
can only meet his obligations by replacing the
entire span and accept that the Policy follows.
Others are more difficult to convince and
arguments ensue; the claim may be settled
on a notional repair or compromise basis.
Like many issues that arise at the time of
a claim this could be dealt with at the time of
underwriting the cover. The Insurers position
should be known. If the Insurer does
not accept that the claim follows
the Contractor’s contractual
obligations then this
fact should be
explained to
the Contractor and the Principal when the
policy is negotiated. For clarity perhaps
the cover could be sold as a restricted
form or as an extension using either of the
following policy endorsement wordings:
Repair cover
In the event of indemnifiable damage occurring
to a single HV cable span Insurers’ liability
will be restricted to the cost, notional or
otherwise, of the most economic form of repair
including the insertion of extra joint(s).
Replacement cover
In the event of indemnifiable damage
occurring to a single HV cable span Insurers’
liability will be not more than the cost of
replacement of that span to and from the
nearest existing joint bays less salvage. ■
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