Metal Fabrication and Precision Engineering Insurance
A fabrication business carries two large exposures at once, and most policies written for it address only the first properly.
Fire In Here, Products Out There
The first is your own premises. Cutting, grinding and welding in a building full of metal, oil, gas bottles and dust is the classic workshop fire, and it is your building, your machinery and your order book that burn. The second is what you make. A bracket, a balustrade, a gate, a mezzanine or a machined component leaves your workshop and is installed in somebody else's building, where it can fail years later and injure somebody.
That second one is products liability, and it is the reason fabrication is underwritten differently from site trades. A roofer's mistake stays on the roof he built. A fabricator's mistake is distributed across every job that part went into.
What Metal Fabrication Insurance Covers
Property and machinery at your premises
Buildings if you own them, tenant's improvements if you lease, and the plant: press brakes, guillotines, lathes, CNC machines, welding sets and extraction. Replacement values including installation and commissioning, which on CNC plant is a significant part of the figure.
Products liability
The section that distinguishes this trade. Answers injury or damage caused by something you made after it has left you, which can be years later and in a building you never visited.
Business interruption
A fabrication business without its machines has nothing. Lead times on replacement CNC plant and the time to re-establish a workshop make the indemnity period the number that matters, and twelve months is frequently too short.
Public liability
Visitors to the workshop, and your own people on site where you deliver or install. £5 million is the practical floor and £10 million where you install on commercial sites.
Employers' liability
Compulsory at a £5 million statutory minimum. Metalworking carries recognised long tail health exposures in welding fume, metalworking fluids and noise, and underwriters now ask about extraction and surveillance directly.
Goods in transit and work in progress
Fabricated items in your van or on a lorry, and other people's material you are working on, which is property in your care rather than your own stock.
Professional indemnity where you design
Where you size a beam, design a balustrade to a standard or engineer a mezzanine rather than making to somebody else's drawing, the failure is a design failure and the loss is financial.
Where The Cover Stops
Wordings differ between insurers, so treat these as the usual position rather than as universal fact. Where one of them matters to you, it is worth checking on your own schedule before you need to.
Hot works conditions in your own workshop
Most people associate hot works conditions with site work. They apply to your premises too: clear areas, screens, extinguishers, and an end of shift inspection period after cutting and welding stop. A fire claim is tested against them.
Products liability excluded or sub-limited
Some policies written for fabricators cover public liability properly and treat products as an afterthought with a lower limit. On this trade that is the wrong way round.
Design, where you did it
Products liability answers a manufacturing defect. It does not answer a design that was inadequate from the outset, which is professional indemnity. If you engineer as well as make, both are needed.
Welding fume and long tail health
Respirable welding fume is now treated as a recognised carcinogen risk, and local exhaust ventilation is expected rather than optional. Claims can arrive decades later, which makes continuity and old certificates worth keeping.
Dust and swarf housekeeping
Combustible dust, oily swarf and rag bins are recognised ignition sources. Poor housekeeping around a machine is a condition breach rather than untidiness when a fire follows.
Machinery breakdown is separate
A press brake that fails mechanically is not damage by an insured peril. Breakdown cover is a separate section and without it the repair and the downtime are yours.
Products Liability Is The Part That Gets Underinsured
A fabricator's worst claim is rarely in the workshop. It is a thing they made, in use, failing.
A balustrade that gives way on a mezzanine, a gate that falls on somebody, a bracket that drops a unit, a staircase that moves. The injury happens in a building you may have never seen, years after you invoiced, and the claim comes to you as the maker. That is products liability, and the limit needs to reflect an injury claim rather than the value of the part, because the two are entirely unrelated: a £40 bracket can produce a six figure injury claim.
Two practical things follow. Check the products limit specifically rather than assuming it matches the public liability figure, because on some policies it does not. And keep the records: material certificates, weld procedures, who welded what, and the drawing revision you worked to. Years later, that paperwork is the only thing that distinguishes a defensible claim from an indefensible one.
The Workshop Fire, And The Condition You Did Not Read
Fabrication workshops burn with some regularity, and the cause is usually mundane rather than dramatic.
Grinding sparks into a bin of oily rag. Hot metal offcuts dropped near a pallet. A cutting operation left half an hour before the shift ended, with nobody back in the building. Combustible dust on surfaces above head height that nobody cleans. None of it is exotic and all of it is covered by conditions you have agreed to without necessarily reading them.
The typical requirement is a cleared and screened area for hot works, extinguishers to hand, and a fire watch for a stated period after cutting and welding stop, commonly sixty minutes, before the premises are left. That last one is the condition most often breached, because it conflicts directly with finishing at five. Ask what the period is, and build the shift around it rather than around the gate time.
Machinery Breakdown Stops Everything
A fabrication business is its machines, and the thing that takes a machine out is frequently not an insured peril at all.
A CNC machine with a failed drive, a press brake with a hydraulic failure, a laser with an optics problem: that is breakdown rather than damage, and an ordinary property policy does not respond to it. Without breakdown cover, the repair cost and the lost production are entirely yours, and on a single-machine shop the lost production is the larger figure.
Worth looking at two things together. Breakdown cover, including the increased cost of working so you can subcontract out while a machine is down. And the business interruption indemnity period, because lead times on replacement machine tools run to many months and a twelve month period on a total loss is optimistic. Price the period against a realistic replace-and-commission timeline rather than accepting the default.
Fabricate And Install Is Two Trades
A workshop that also fits what it makes is running a manufacturing risk and a site risk at once, and policies frequently describe only one.
On site you are working in somebody else's building, often at height, lifting heavy awkward items, sometimes with hot works, and the exposure is public liability and damage to the structure. In the workshop it is fire, machinery and products. Both need to be on the schedule, with a realistic split of turnover between them, because the rating basis is different for each.
The common failure is a workshop policy with installation bolted on as an afterthought, or a trades policy with the workshop barely mentioned. Either way, one half of the business is underdescribed, and it will be the half that has the claim.
How To Choose A Broker As A Fabricator
The usual failure in this trade is a policy that handles the workshop and treats products as a footnote. We are an FCA regulated broker and will not tell you we are the best choice. These are the questions that decide it.
What is the products liability limit, specifically?
Not the public liability figure, the products figure, because on some policies they differ. A small part can cause a large injury claim years after you made it, and that is the number that answers it.
What do the hot works conditions require of you?
They apply in your own workshop, not just on site, and the fire watch period after cutting stops is the condition most often breached because it conflicts with finishing time. Get the exact wording.
Is machinery breakdown included?
A CNC machine failing mechanically is not damage by an insured peril. Without breakdown cover the repair and the lost production are yours, and on a single-machine shop that is the business.
Is the business interruption indemnity period realistic?
Lead times on replacement machine tools run to months. Twelve months is the default and is frequently too short, and it is the number that determines whether the business reopens.
Is design separated from manufacture?
If you size and engineer rather than making to a given drawing, products liability does not answer a design failure. That is professional indemnity and it needs to be a decision.
Are workshop and installation both described?
They are two rating bases. A policy that mentions one properly has underdescribed the other, and that will be the half with the claim.
Factually, here is what we do against those questions. We quote the products liability limit as its own figure rather than letting it default below the public liability one, we give you the hot works conditions in full including the fire watch period, we raise machinery breakdown and increased cost of working rather than waiting to be asked, we set the interruption period against a realistic replace-and-commission timeline, and we describe workshop and installation separately with a turnover split. We are a broker, so it goes to several insurers rather than one.
Metal fabrication and precision engineering are both named in the appetite of one of the insurers we deal with. We also insure the structural steel contractors and shopfitters who install what fabricators make, so where a claim crosses between maker and installer it is familiar ground.
What Moves The Price
Every policy is priced on the business behind it. These are the things that move the premium:
- The products liability limit, and what you make
- Whether you design as well as manufacture
- Construction of the premises and any sprinkler protection
- Hot works procedure and housekeeping standards
- Machinery values including installation, and breakdown cover
- The business interruption indemnity period and gross profit
- Welding fume extraction and health surveillance
- The split between workshop work and site installation
We are a broker, so we take it to several insurers rather than quoting one. Call 02382 000820 for a quote.
What We Need To Quote
- What you fabricate, and for which sectors
- Whether you design and engineer or work to given drawings
- Whether you install what you make, and the turnover split
- Machinery schedule with replacement values
- Premises construction, protections and hot works procedure
- Extraction, fume control and health surveillance arrangements
- Gross profit and a realistic indemnity period
- Any claims, including product failures however old
Cover that often goes with this
The gaps we most often find sitting next to this policy.
- Structural steel contractorsErecting on site rather than fabricating in a workshop.
- Machinery installation and removalMoving and installing heavy plant you may have made.
- Business interruptionThe indemnity period, against real machine lead times.
- Commercial combinedHow property, machinery, interruption and products sit together.
- Professional indemnityWhere you engineer rather than make to a drawing.
- Talk to a brokerAsk us what your products limit actually is.
Common questions
What insurance do metal fabricators need?+
Property and machinery cover at replacement value including installation and commissioning, business interruption with a realistic indemnity period, and products liability as its own figure rather than an afterthought, because the worst claim in this trade is something you made failing in somebody else's building years later. Public liability at £5 million as a floor and £10 million where you install, and employers' liability at a £5 million statutory minimum. Then machinery breakdown, goods in transit, and professional indemnity if you design and engineer rather than making to a given drawing.
Am I liable if something I fabricated fails years later?+
Potentially yes, as the maker, and this is why products liability matters more here than in site trades. A balustrade that gives way, a gate that falls, a bracket that drops a unit: the injury happens in a building you may never have visited, long after you invoiced. The limit needs to reflect an injury claim rather than the value of the part, because the two are unrelated and a cheap component can produce a very large claim. What defends it is records: material certificates, weld procedures, who welded what, and the drawing revision you worked to. Years later that paperwork is the whole case.
Do hot works conditions apply in my own workshop?+
Yes, and that surprises people who associate them with site work. Expect a requirement for a cleared and screened area for cutting and welding, extinguishers to hand, and a fire watch for a stated period after hot works stop, commonly sixty minutes, before the premises are left unattended. That last condition is the one most often breached because it conflicts directly with finishing at five, and a workshop fire claim is tested against it. Ask what your period actually is and build the end of the shift around it.
Does my policy cover a CNC machine breaking down?+
Not under an ordinary property policy, because a mechanical or electrical failure is breakdown rather than damage by an insured peril. You need machinery breakdown cover for that, and it is worth looking at alongside increased cost of working so you can subcontract production out while a machine is down. On a shop with one key machine, the lost production is a larger figure than the repair. Also check the business interruption indemnity period, because replacement machine tool lead times run to many months and the standard twelve is frequently optimistic.
Do I need professional indemnity as a fabricator?+
If you design as well as make, yes. Products liability answers a manufacturing defect, meaning the thing was not made to the drawing. It does not answer a design that was inadequate from the start, meaning the drawing itself was wrong, and if you sized the beam, engineered the mezzanine or designed the balustrade to a standard then that is your decision rather than the client's. The loss in that case is financial and advisory. If you only make to drawings supplied to you, the case is weaker and products liability may be enough.
Who insures metal fabricators and precision engineers in the UK?+
Both are named in the appetite of one of the insurers we deal with, and the market is reasonably available where the risk is presented properly. What separates placements is wording rather than price: whether the products liability limit stands on its own, what the hot works conditions require of you in the workshop, whether machinery breakdown is included, whether the interruption period reflects real machine lead times, and whether workshop and site installation are both described with a turnover split.
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