Machinery insurance is one of the most well known engineering products which has given important contribution to a various types of manufacturing process for many years. A long-time existence of machinery insurance in supporting business cycles has been recognized for all type of industry scale. This insurance is not only appropiate for largely automatic industrial plants but also for small and medium companies. They have same problem with the possibility of risk emerged in the manufacturing process to their plants that may affect to serious economic and financial loss.

Basically, all kinds of machinery, tool, and equipment can be covered under machinery insurance, such as generators, turbins, transformers, compressors, pipes and tubes. But, there are several machineries that can not be insured under machinery insurance, namely :

1. exchangable tools, such as dies, moulds, and engraved cylinders.

2. any parts which by their use suffer high rate of wear and tear or depreciation, such as refractory linings, crushing hammers.  

3. objects made of glass, belts, ropes, wires, rubber tiers.

4. operating media, like lubricants, fuels, and catalysts.

As other engineering insurance types, machinery insurance provides basic cover to the items insured from any unforeseen and sudden physical damage, which is usually took place by one of the following causes :

1. faulty design, faults at workshop or in erection.

2. bad workmanship, lack of skill, faulty operation.

3. shortage of water in boilers.

4. physical explosion.

5. short circuit.

6. storm.

7. any other cause that not specifically excluded in policy schedule.

Regarding to policy exclusions, there are a number of cause which usually excluded in machinery policy schedule, namely  :

1. fire, lightning, chemical explosion, theft, burglary, flood, inundation, earthquake, volcanic eruption, subsidence, landslip, landslide, and aircarft.

2. willful act or gross negligence of the insured or his representatives.

3. war, invasion, act of foreign enemy, hostilities, civil war, rebellion, revolution, riot, strike, lock-out workers, civil commotion, military or usurped power, confiscation, commandeering, and destruction to property by order of any government.

4. faults or defects existing at the time of commencement of the insurance which have been known by the insured.

5. nuclear reaction, nuclear radiation or radioactive contamination.

6. wear and tear as a continual influence of operation.

After we know the basic coverage as well exclusions in machinery insurance, we can choose the most appropiate insurance package for industrial business environment. For the future time, this insurance will always be required by various type of industrial companies because of significant contribution to the manufacturing business cycle.