An industrial machine contains significant value in a weight that does not reflect its cost, and damage may not become apparent until commissioning tests are conducted. In the event of loss or damage during transit, the carrier’ Carrier ’s liability may be capped based on the weight or the applicable regime, and may remain well below the actual value of the goods. Ad valorem cargo insurance can cover the goods based on an insured value, subject to the limits and conditions of the policy.
This guide is intended for machine manufacturers, system integrators, distributors, importers, and after-sales service providers. It explains when the manufacturer’s liability under the Product Liability Act ( Carrier ) is insufficient, how to distinguish between different types of coverage, what equipment may be covered, what insurance generally covers and excludes, how to secure a shipment, and how to ensure you receive compensation in the event of a claim.
Why insure an industrial machine during transport?
There are three reasons to take a closer look.
High concentrated value. A CNC machine tool, an industrial robot, a machining center, a measuring machine, automation equipment, a training simulator, or a control module can account for a major portion of an order, even though its weight bears no relation to that cost.
Damage that is sometimes invisible. This is the key point. A machine may arrive with no apparent damage but exhibit a loss of geometry, misalignment, calibration errors, excessive vibration, a damaged sensor, a compromised circuit board, or settings that need to be re-validated. The defect only becomes apparent during acceptance testing, when the machine no longer meets the expected tolerances.
A costly turnaround time. Diagnosis, assessment, disassembly, realignment, recalibration, replacement of parts, technician service, requalification, and postponement of installation at the customer’s site: the total cost frequently exceeds the value of the component in question. As such, the loss of revenue resulting from downtime should not be assumed to be covered: it is generally covered by a separate warranty or extension, which should be verified in the contract.
Is the carrier's liability sufficient?
In many cases, no. The liability of the Carrier is governed by the applicable regulations and may be capped, particularly based on the weight of the goods. It therefore does not automatically correspond to the actual value of the machine.
The SDR, or Special Drawing Right, is a unit of account used by the International Monetary Fund whose value fluctuates; conversions to euros are for informational purposes only, and only the SDR values are authoritative. Therefore, you should not use euro amounts without verifying the date, the SDR exchange rate, and the applicable rules. The overall mechanism is detailed in our guide to cargo insurance.
An example illustrates the discrepancy. A 1,000-kg machine valued at €150,000 may be compensated based on a weight-based limit that is far below the actual cost of the property. The exact amount depends on the mode of transport, the contract, the applicable law, the nature of the damage, and the circumstances of the loss; the example illustrates an order of magnitude, not a contractual simulation.
It would be inaccurate to say that liability “ends at the weight” in all cases. The correct way to put it is that, under many insurance policies, compensation is capped based on weight, unless a declared value, a special agreement, or a specific policy applies.
What is the difference between the different types of coverage?
Several concepts overlap in research without having the same focus.
The declared value raises the carrier's liability limit but leaves the liability regime—including its exemptions and exclusions—unchanged. Ad valorem insurance covers the goods based on an insured value, independent of the compensation provided solely under the " Carrier," within the limits of the policy. This principle is explained in our guide to ad valorem insurance.
What types of industrial equipment can be insured?
The range is broad: machine tools, machining centers, CNC lathes and milling machines, industrial robots and cobots, automated lines and cells, material-handling equipment, test and measurement benches, metrology instruments, industrial electrical and electronic equipment, programmable logic controllers and automation modules, control cabinets, motors, drives, and power components, industrial laboratory equipment, driving and training simulators, prototypes and demonstrators, as well as spare parts and machines returned for maintenance or repair.
However, insurability is not automatic. It is assessed on a case-by-case basis, and certain categories require a specific analysis: hazardous materials, equipment containing batteries, temperature- or humidity-controlled products, radioactive or regulated materials, incomplete or partially manufactured machinery, oversized shipments, used or refurbished goods, and shipments involving heavy handling or on-site installation.
What does college insurance cover?
Coverage depends on the contract. An all-risk policy may cover total or partial loss, theft (when covered), breakage, accidental damage, damage resulting from impact, handling, or overturning, and damage to movable parts. It may include repair costs, replacement costs depending on the basis of indemnity, return or reshipment costs when provided for, appraisal costs, and, if the contract provides for it, recalibration or reconditioning. Coverage may extend to outbound and return trips, after-sales service, loaner equipment, and demonstrations.
The key differentiator is the basis for compensation, as it determines what will actually be paid: purchase price, replacement value, an agreed-upon value established in advance, repair costs, restoration costs, costs to bring the machine back into compliance, or ancillary costs specified in the contract. For industrial machinery, the relevant value is not always the price of a single part: it is often necessary to consider the total costs required to restore the machine to an operational, compliant, and tested condition.
What exclusions should you check for?
Carefully reviewing the exclusions helps avoid unpleasant surprises. The most common issues stem from insufficient packaging, padding, or securing; inherent defects; defects existing prior to shipment; normal wear and tear; internal failure with no proven link to the shipment; delay alone, temperature or humidity deviations without appropriate protection, transport by an unauthorized carrier, prohibited or misdeclared goods, lack of proof of value, late reporting, repairs undertaken before an inspection when prior approval is required, or failure to follow handling instructions. Depending on the policy, political, war, or cyber risks, as well as unforeseen business interruption, may also be excluded.
No wording should imply that an insurance policy covers “all risks” without reservation. In particular, business interruption should not be presented as automatically included: it is generally a separate coverage or extension of property damage insurance.
How can you ensure the security of a shipment of industrial equipment?
A few simple precautions can significantly reduce the risk of damage and denial of compensation. Before shipping, it is helpful to note the model number, serial number, and value of the equipment; take photographs of it before packing; document its cosmetic and functional condition; retain calibration or geometric data; secure any moving parts; protect components sensitive to vibration; and use packaging appropriate for the weight, center of gravity, and fragility of the item. Checking temperature or humidity control requirements, specifying handling instructions, verifying the capabilities of the Carrier and its subcontractors, confirming coverage before handing over to the Carrier , and retaining documents regarding value, transport, and compliance complete the preparation process.
Upon receipt, inspect the packaging before opening it, photograph any signs of impact, tampering, or spillage, state specific reservations—not limited to the phrase “subject to unpacking”—test the machine according to a documented procedure, retain the packaging and any damaged parts, and notify the insurer within the time frame specified in the contract.
What should you do in the event of damage or loss?
The procedure consists of three stages.
Upon delivery, inspect the parcel and the machine, note any specific, detailed, and justified reservations, take photographs of the condition of the merchandise, and have these reservations confirmed by the carrier.
After commissioning, perform functional tests, compare the measurements to the reference values, document any defects in geometry, alignment, or calibration, and do not undertake any major repairs without following the procedure specified in the contract.
To preserve your right of recourse, be sure to distinguish between the different time limits. For domestic transport within France, Article L.133-3 of the Commercial Code requires a reasoned protest to be sent to the carrier within three days of receipt, excluding holidays; this same article specifies that it does not apply to international transport, which is governed by the applicable convention. The deadline for reporting the claim to the insurer, as specified in the contract, is distinct from the deadline for pursuing a claim against the Carrier, as are any applicable statutes of limitations and the formalities for obtaining an expert assessment. Subrogation links these steps: after paying compensation, the insurer may pursue a claim against the liable party, so that reservations, evidence, and compliance with deadlines also serve to preserve this right of recourse.
How does this relate to machine compliance?
Regulation (EU) 2023/1230 establishes health and safety requirements applicable to machinery, related products, and partly completed machinery. It replaces Directive 2006/42/EC and takes effect on January 20, 2027.
The key issue for a shipment is not to conduct a compliance review, but to draw practical conclusions following damage. A damaged machine should not be put back into service without a proper inspection; a repair may require technical validation; compliance documentation must be retained; a substantial modification may have regulatory consequences; and the cost of the incident may include bringing the equipment back into compliance, re-certification, or additional testing, if the insurance policy provides for it. In short, the CE marking does not constitute transportation insurance and does not guarantee the absence of damage during transit; however, compliance and technical documentation can influence repair, return-to-service, and re-certification procedures following an incident.
How can you account for recurring cash flows?
Many companies regularly ship new machines, spare parts, electronic modules, loaner equipment, prototypes, demonstration units, after-sales service returns, refurbished machines, or equipment sent to a subcontractor—often using multimodal transport. A tailored insurance policy can bundle these categories of shipments, allow companies to retain their current carriers, cover different routes, handle returns and replacements, avoid case-by-case management, limit minimum premiums—where they exist in competing offers—and better align the cost of coverage with the actual value shipped. These parameters are determined at the time the contract is signed, without prejudging a rate, a limit, or a delivery timeframe.
How much does it cost to insure an industrial machine?
There is no standard rate: the cost depends on the insured value, the goods, the route, the mode of transportation, the frequency of shipments, the claims history, the packaging, the coverage, and the deductible.
More specifically, the following factors come into play: the unit value and annual value of the shipments, the nature of the goods and their electronic sensitivity, the origin and destination, the use of road, sea, air, or multimodal transport, specialized handling and oversized shipments, packaging, the countries involved, the claims history, coverage for returns and after-sales service, the basis for compensation, the deductible, and the per-ship Limit . The key consideration is not just the unit cost, but overall efficiency: coverage proportional to value—independent of the Carrier and pooling shipments—optimizes the overall cost. Do you regularly ship machinery, equipment, or industrial parts? You can create your Claisy account to explore coverage tailored to your shipping volumes.
For medical and laboratory equipment, see our guide to medical equipment insurance; for shipments with a very high value-to-weight ratio, see our guide to high-value parcel insurance.
Sources
- Regulation (EU) 2023/1230 on machinery (effective January 20, 2027; replaces Directive 2006/42/EC), consolidated version on EUR-Lex: https://eur-lex.europa.eu/legal-content/FR/TXT/PDF/?uri=CELEX:02023R1230-20230629
- CMR Convention, Article 23; Montreal Convention (limit increased to 26 SDR/kg as of December 28, 2024, ICAO): https://www.icao.int/news/international-air-travel-liability-limits-set-increase-enhancing-customer-compensation-0
- Commercial Code, Article L.133-3: https://www.legifrance.gouv.fr/codes/article_lc/LEGIARTI000021486442
- General Standard Contract, Decree No. 2017-461 of March 31, 2017, Légifrance: https://www.legifrance.gouv.fr/jorf/id/JORFTEXT000034330431