Liability Insurance for Construction Machinery

Definition of Liability Insurance

Liability refers to the obligation to compensate for damage caused to the property of another person. The insurer first checks whether the claims raised against the insured are justified. In the case of unjustified claims, liability insurance also covers potential legal and court costs to defend the policyholder (legal protection function). If the claims are justified and a claim arises, liability insurance covers the claims up to a coverage limit specified in the insurance contract.

Is there liability insurance when renting construction machinery?

Since most construction machinery is not covered by the mandatory insurance law, liability insurance generally does not exist. If damage occurs through the use of rented construction machinery not to the machine itself, but to third parties, the renter is initially liable. However, the renter can often include this risk in their business liability insurance.

Also important to note: Although construction performance insurance can cover construction services already completed during the construction period until acceptance, construction machinery used on the construction site is not included in such construction performance insurance – for this, machinery insurance would be required.

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Machinery Insurance – Practical Applications

Such machinery breakdown insurance (or machinery insurance for short) against unforeseen damage to the machines is typically provided by the lessor for rented construction machinery. A corresponding insurance amount is charged to the customer as a proportional share along with the rental costs. However, machinery insurance excludes vehicles used exclusively for the transport of commercial goods on public roads or for passenger transport, such as trucks or buses.

What insurance for rented construction machinery does klarx provide?

When you rent a construction machine from klarx, our General Terms and Conditions apply. According to these, the renter is generally liable for damage to rented construction machinery (machinery breakdown) in accordance with general liability rules. It is important that the loss or damage of rented equipment must be reported to us in writing without delay.

As a renter with klarx, you have the option to limit this liability by paying a fee to a specific deductible amount. If such a liability limitation fee is agreed, you only need to pay a fixed deductible if damage occurs to rented construction machinery due to negligent fault on your part. How high this is depends on the list new value of the machine. Further information, for example on liability for misuse, operational errors, overload, intent, gross negligence, or theft, can be found in our Terms and Conditions. If no liability limitation is agreed with us, you as the renter are required to take out insurance yourself. However, a liability limitation agreed between the renter and klarx does not cover damage caused to third parties – in this case, (business) liability insurance would be required.