BRIEF PROPERTY

UNDERWRITING
REPORT

PT GREENFIELDS INDONESIA – MILK FACTORY

Jl. Gunung Kawi, Desa Palaan, Area Sawah Kebun,
Kecamatan Ngajum, Kabupaten Malang, East Java 65164

PT Greenfields Indonesia |Malang | May 2018 | Page 1

 GENERAL INFORMATION

1. The Insured PT GREENFIELDS INDONESIA

2. Risk Location Jl. Gunung Kawi, Desa Palaan, Kec. Ngajum, Kab. Malang, East Java

3. Conferred with Mr. Robby (Finance)

4. Occupation Milk Processing Plant

5. FALO 140 / 2 / H50 – Dairy Produce Factories

6. OJK 2751 – Dairies and Dairy Products Factories

7. NACE 1050a – Milk Processing: Dairy, Cheese-making dairy

8. Coverage PAR

9. Interest Insured

 Building / Material Damage IDR. USD.



 Machinery / Equipment /BI IDR. USD.



 Stock / Content IDR. USD.



 Others (please specify) IDR. USD.



Total Sum Insured IDR. USD.

10. Intermediary AXA Singapore

11. Survey date 30 May 2018

12. Surveyed by Timon Erdinan

13. Reviewed by Sigit H

This information and any document associated with it are confidential and remain the property of PT Asuransi AXA Indonesia. The report is
intended for internal use only and if transmitted externally, is solely for the attention of the individual or entity to whom it is addressed and
should not be provided to the Insured or potential client of PT Asuransi AXA Indonesia without the express permission of PT Asuransi AXA
Indonesia.

The Insured’s Name |Location | Survey date |Page 2

EXECUTIVE SUMMARY

During the 30th May 2018, a risk visit was conducted at the PT GREENFIELDS INDONESIA located at Jalan
Gunung Kawi, Ngajum, Malang, East Java.

The objectives were to gather basic underwriting information and to make inspections of the company. This
report contains a brief description of the site based on information provided by the owners/operators of the
subject facility, through documentation data and interviews with their representatives, and visual inspection
of the selected facilities.

Second visit carried out. This is an existing business to AXA Indonesia.

PT Greenfields Indonesia (GI) was established by a group of Australian and Indonesian entrepreneurs
with strong agribusiness experience on March 14, 1997. The Company commenced the development of a dairy
farm at Babadan Village, Mount Kawi, Malang, East Java, an ideal environment for the special dairy cows
imported from Australia. In April 1999, the Company began the construction of a milk processing facility that
became operational in June 2000. PT Greenfields Indonesia currently produces range of Fresh Dairy products
like liquid milk (i.e., Pasteurized and Ultra High Temperature (UHT), fresh cheese, whipping cream, and yoghurt.
The company was awarded with ISO 22000 and HACCP Certifications.

In March 2018 GI has opened its second dairy farm in Wlingi Village – Blitar. This farm will have over 7,000
dairy cattle with a capacity to produce 2.2 million liters of milk per month by the end of 2018.

The risk being reported here is its milk processing plant in Palaan Village – Malang.

DAIRY PRODUCTS FACTORY

This new milk factory commenced operation in May 2017 with designed production capacity of 70 million liters
of fresh milk per year. It produces Extended Shelf Life (ESL) pasteurized and Ultra High Temperature (UHT) liquid
milk, yoghurt and fresh cheese products such as ricotta, camembert and mozzarella.

It currently employs approximately 245 staffs including 15 security personnel. It operates 24 hours per day, 6
– 7 days per week over 3 shifts in the Production area and 8 hours per day over 1 shift in the Office building.

MILK PROCESSING FLOW

Raw milk is supplied to the site via milk tanker truck from its Babadan farm which is located app. 20km away
from the site.

The milk processing is described below :

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From Aseptic tanks, the milk is packed in an impermeable package with a hygenis packing system. UHT milk
and ESL Milk in pack into carton automatically using machine with high efficiency. UHT milk can last up to 10
months. Longer than ESL milk, which can only last for 2 weeks. For other processes such as the process of
making Cheese and yoghurt done manually without using any machinery.

The facility is equipped with modern machinery and operated by trained supervisors and operators. Each step
of fully automated and integrated processes of pasteurisation, sterilisation and packing is controlled by a
Programmable Logic Controller (PLC) to ensure a zero-error operation flow.

FINISHED PRODUCT
For finished goods UHT milk and Fresh Cheese will be stored in the warehouse by using metal racking. As for
the finished goods ie ESL milk and Yogurt will be stored in cold storage room warehouse. From the information
obtained, the temperature can reach 5o Celsius.

SITE LOCATION

This risk is located on a slope of the Mount Kawi on an area of 7.2 hectares. It is approximately 15 – 20km
south of Babadan farm or about 1 hour drive.

The surrounding of the site mainly comprises paddy fields and empty land. The perimeter of the site is installed
with boundary walls (3 – 5 meter high). Impact exposure from the surrounding may be regarded as low, due
to adequate separation from roadways and residential area.

GPS Coordinate
Longitude 1120 32’ 59.1972’’ E
Latitude 80 5’ 58.0056’’ S

PT Greenfields Indonesia |Malang | May 2018 | Page 4

BUILDING CONSTRUCTION

The site consists of one Main buildings and supporting buildings as, Security post, Boiler room, Generator room,
Cheese production building and Waste Treatment Plant Building, separation between each building ranges
between fifteen to fifty meters apart. There is no connection roof between buildings with each other.

The Main building is housing production, warehouse, and office. Walls of the Main building are constructed of
brick/concrete blocks. Flooring is concrete with coating paint and roof is corrugated metal mostly without
insulation. Two-storey buildings for production area are supported by bare steel beams.
Several ancillary equipment and support buildings are also installed on the site and these are mainly of brick
or concrete construction. They can be classified as separate risks.

UTILITIES
Electrical power is obtained from the PLN, a state-owned Power Plant. The incoming capacity of 20kV is
complemented with three units of emergency generators with capasity 630 kVA. The plant has two boiler units
producing steam for the purpose of power generation and process heating. The main fuel for this 20 tph boiler
is wood pulp, hazelnut shell and palm. Wood pulp, hazelnut shell and palm is fed to the boilers via conveyor
system into the fire pit.

In addition, three diesel engine operated generator sets are installed in the engine room to act as a back-up.
These sets are of Krisbow make – one of 150 KVA, two units of 630 KVA capacities.

In addition, there are also Carrier Water Cooled Chiller 30 HXC-271 and cooling tower in the utility room.

Maintenance of plants and equipment is managed by an internal engineering team supported by vendors and
contractors. This engineering team is deployed into two areas of responsibility, i.e. utility maintenance and

PT Greenfields Indonesia |Malang | May 2018 | Page 5

general maintenance. They are responsible for preventive and routine maintenance of production equipment
as well as utilities. Overall condition of equipment and machinery on site can be considered average. Specialist
maintenance and repairs are outsourced.

HUMAN ELEMENTS
The human element programs at site are already good. Control of ignition sources like smoking policy has also
gone well. Smoking is strictly prohibited in the factory areas, whilst the dedicated smoking areas are identified
at external areas. There are adequate signs to warn people of the hazards of smoking.

Hot work activities are strictly restricted to engineering workshop only.

Housekeeping throughout the main building was to average standard at the time of the survey.

As reported, there are no insurance losses in the facility since its commissioning. No claims have been recorded
for this location over the past five years.

A Safety Committee oversees workplace health and safety matters and administers Hot Work operations.

FIRE PROTECTIONS
Fire protection of the site is provided by a hydrant system, smoke detectors and portable extinguishers. There
are 32 units of fire extinguisher (CO2 type) and 28 units of Powder type, and 14 units of hydrant outlets installed
throughout.

Surveyor noted that there is no deficiencies about fire protection on the sites.

Fire team comprises personnel from engineering and security personnel.

The latest fire drills are carried out around six mounth ago.

The closest public fire brigade at Malang city is app. 35 km away from the site.

LOSS EXPERIENCE

No claim has been recorded for this location over the past five years.

NEW PROJECTS / CHANGES

It was advised that capacity of warehouse will be increased.

PT Greenfields Indonesia |Malang | May 2018 | Page 6

PICTURES

Greenfield Indonesia plant layout

Post security and goods receipt office

PT Greenfields Indonesia |Malang | May 2018 | Page 7

PICTURES

Unloading activity of tanker car

Hygienic production process

View Of Warehouse

PT Greenfields Indonesia |Malang | May 2018 | Page 8

PICTURES

Fire alarm and Fire extinguisher

Outdoor hydrant and Schedule of fire extinguisher maintenance

Boiler and Electric panel room

PT Greenfields Indonesia |Malang | May 2018 | Page 9

INSURED PERILS

Fire and Explosion MODERATE

Refrigeration equipment presents hazard inherent to compressed gases, potential vapor release, moving mechanical part,
and electrical control system. Freon refrigerant is less volatile compared the ammonia but still considered toxic. This
material can contaminate food and otherwise damage equipment and stock.

The site consists of one milking processing building, and a dairy farm including cattle barns, milking parlour, feed crushing
and feed storage buildings. They are separated from one another by a minimum 10m of space, and are of non-combustible
construction. The partitioning walls and ceiling in the Milking Processing building are using metal sandwich panels
insulated with expanded polyurethane. While the Cattle barn in the dairy farm is mainly open sided and only few are
covered with light plastic sheets.

Fire protection of the site is solely provided by a hydrant system and portable extinguishers. Deficiencies noted during
our visit may reduce the effectiveness of the fire protection system.

Lightning LOW – MODERATE

The area is susceptible to lightning strikes but buildings are installed with lightning protection systems. There is no loss
recorded due to this peril. Exposure from this peril is considered low to moderate.

Aircraft / Vehicle Impact LOW

Abdul Rachman Saleh Airport is about 32km to the east. It does not appear that the site is directly under any flight
path.

Vehicles are parked in the dedicated parking slots inside the farm. Internal roads are wide enough for safe movement
of vehicles.

Earthquake and Volcanoes MODERATE

This location is within the Zone IV (High Risk : Severe Potential Damage, Intensity : VIII MMI) according to the Maipark
Earthquake map.

The site sits on a slope of Mount Kawi, one of stratovolcanoes in East Java. There is no historical record of its eruptions.

Windstorm MODERATE

The site sits on a terrain of Mount Kawi which may be exposed to a sudden wind storm. It was advised that one of
cattle barns had been damaged due to this peril. Further information was not obtained during our visit.

Flood / Water Damage LOW

It was reported that the mill has never experienced flood incident since the beginning of operation. Flood exposure is
considered low.

PT Greenfields Indonesia |Malang | May 2018 | Page 10

 Landslide / Subsidence LOW

No experience of subsidence has been reported which was confirmed through observation

3rd Party Risks / RSMD / RSCC LOW

Fire risk exposure from surrounding is considered low. The risk is located on a slope of the Mount Kawi on app. 1,200
meters above sea level with no immediate local residential population in the area.

It is reported that working relation between the management and the workers is good based on the facts that the company
pays the workers according to the minimum wages declared in the region and give incentives where necessary. The
company has followed the labor law of Indonesia which written down inside a collective agreement between workers and
company. In overall, serious efforts have been made by the company to improve the condition. Overall, the risk exposure
is considered low.

PT Greenfields Indonesia |Malang | May 2018 | Page 11

LOSS ESTIMATION

PROBABLE MAXIMUM LOSS (PML)

DEFINITION
The following Probable Maximum Loss (PML) estimation is based on the calculation of the maximum loss that could
possibly happen in an event of fire with all fire fighting equipment and external assistance were not considered, and
therefore only stopped by impassable obstacles or by lack of combustible material.
LOSS ESTIMATION
The generator house, boiler room, UPS room, diesel fuel tank and cheese production building are located around 12
meters away from main building. While security post, Weighbridge for tanker car and prayer room (the front of the
location) are located around 20 meters from the main building production area
Inside the main building, there are Main Production of milk, office and warehouse. Therefore, The PML is estimated to be
70 % of the total sum insured.
ESTIMATED MAXIMUM LOSS (EML)
DEFINITION
The Estimated Maximum Loss is based on the consideration of the maximum loss that could result in a fire with fire
extinguishing effort being carried out to stop the fire.
LOSS ESTIMATION

The EML is same as PML of 70 %.

PT Greenfields Indonesia |Malang | May 2018 | Page 12

 PT ASURANSI AXA INDONESIA
AXA Tower, Lt. 11,
Jl. Prof. Dr. Satrio Kav. 18, Kuningan City,
Jakarta 12940, Indonesia
Telp. 62 21 3005 9000
Fax. 62 21 3005 9009
Website : www.axaindo@axa-insurance.co.id
Email : customer@axa-insurance.co.id

PT Greenfields Indonesia |Malang | May 2018 | Page 13