Page 115 - Sectional Title Policy Wording

Machinery Breakdown
DEFINED EVENTS
MACHINERY BREAKDOWN
Any unforeseen and sudden physical damage to the machinery described in the Schedule from any cause not excluded whilst it is:
1. at work or at rest;
2. being dismantled for the purpose of cleaning, inspection, overhaul or removal to another position or in the course of these operations themselves or subsequent re-erection within the insured premises.
BASIS OF INDEMNITY
Irrespective of the original cause the amount payable by Hollard shall be determined by:
1. Sum insured
It is expressly agreed between You and Hollard that at all times the sum insured for each item of machinery shall be the new replacement value including freight dues, customs duties and erection costs.
2. Underinsurance
If the sum insured on any item of machinery at the time of the loss is less than the new replacement value including freight dues, customs duties and erection costs, You will be considered to be their own insurer for the difference and shall bear a rateable proportion of the loss accordingly.
3. Partial damage
Where the machinery can be repaired Hollard will pay the reasonable costs of restoring it to working order based on the customary rates of wages in the district and normal freight and erection costs and customs duties.
4. Total loss
If the cost of repairs as described in 1 above equals or exceeds the actual value of the machinery immediately before the occurrence such machinery shall be regarded as a total loss and Hollard will pay the actual value of the machinery immediately before the occurrence which shall be calculated as the new replacement value.
5. Repair, reinstate or replace
Hollard may at its option repair, reinstate or replace any damaged machinery or pay the amount of the damage in cash.
SPECIAL EXCEPTIONS
Hollard will not be liable to pay for:
1. the amount specified in the Schedule as the First Amount Payable by You for each and every occurrence;
2. damage due to:
2.1 fire, lightning and explosion: fire, extinguishing of a fire, direct lightning strikes, explosion;
2.2 theft, collapse, impact and sonic waves:
theft, collapse of buildings, impact by animals, vehicles, aircraft, other aerial devices or objects dropped therefrom, sonic shock waves;
2.3 water that escapes from water containing apparatus including leakage or discharge from any sprinkler or drencher system;
2.4 subsidence, landslide, storm, flood inundation, hail, snow, earthquake, volcanic eruption or other convulsions of nature or any subsequent dismantling;
3. wastage of material or wearing away or wearing out of any part of the machinery caused by or naturally resulting from ordinary usage or working or other gradual deterioration;
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