A second life for industrial facilities
When it comes to selling industrial facilities, the relocation itself is not the only risk. For the buyer, the technical performance of the equipment at the new operating site is the most crucial consideration. Funk has developed an innovative all-round protection scheme that covers relocation and disassembly right through to commissioning at the new location.
Anyone going through a relocation has a mountain of work ahead of them. From the sofa to the wardrobes and everything in between, every single item has to be disassembled, boxed up and loaded. One hopes that everything arrives at the new residence in one piece and working exactly like it did before. While relocation is already a hefty task for private individu-als, it is a monstrous job of entirely new dimensions for industrial companies.
For example, for an increasing number of conventional power plants, cost-effective opera-tions in Germany are no longer possible due to the country’s energy transition, even though these facilities are still fully functional in technical terms. The owners have no other choice but to sell up. But ‘Made in Germany’ technology is still in strong demand, especially in markets like Turkey, China or Russia. Scrapped facilities like production plants and machinery fleets that are still in good working order are sold and used further at the new lo-cations.
The relocation alone is a logistical challenge that must be comprehensively insured. But for the buyer, the most crucial factor is that the equipment should have as close to the same technical performance as possible once it is commissioned at the new location. Dr Alexander Skorna, Business Development Manager at Funk, explains, ‘Companies buying second-hand equipment trust that the machinery will have the same performance after installation at the new operating site.’ But what if that is not the case? What if errors occur when the equipment is being installed at the new location?
With Second Life cover, Funk has designed an innovative insurance solution in cooperation with product developer b2b Protect, Hildesheim. This scheme protects not just the disassembly/installation and relocation of industrial facilities, but also hugely reduces the investment risk with an integrated performance guarantee at the new site, both for the buyer and the seller.
Want to know more? Funk expert Dr Alexander Skorna and the Managing Director of brb Protect GmbH discuss the topic of ‘Risks in the relocation of industrial facilities’ in more detail in their contribution to the Insurance & Innovation 2017 book.