Who should take responsibility of Insurance in case of a large sum contract, the Owner or the Contractor? Why?

The insurance is based on the principle of diversified risk. In any commercial transaction, generally two parties are involved - buyer and seller , contractor and principle. The question is who should insured to whom?   If not insured then who will born the risk?

Let answer the second question first, risk to be born by whom is defined in sales contract. Now suppose if as per sales contract, it is the buyer who will born the risk then it is up to buyer whether he want to carry the risk with him or get it insured by taking the insurance policy.

The answer of main question is that the insurance should be taken by the party who is liable to born the risk as per sales contract.

I have the practical experience of marine insurance - if inco term is "FOB" the buyer is supposed to cover the risk of transit.

and if inco term is CIF then seller is supposed to take the insurance to cover the transit risk.

 

the owner because it is the company who is responsible for the contract reaches its intended objective, the owner must be sure that the contractor with which developed the project complies with the right profile.

As per contract wherever large sum contract is not limited by clear value for me as a general contractor better to take this responsibility to prevent any reason of work delay

 

Contractor should cover the Insurance for possible Risks