Contractors equipment insurance is a type of inland marine coverage for tools, machinery and equipment that move between job sites, yards and vehicles. It pays to repair or replace covered equipment after theft, fire, vandalism, collision or other covered causes, which many property policies limit once equipment leaves your premises.
What it usually covers
- Owned tools and equipment at job sites, in storage and in transit
- Scheduled heavy equipment such as excavators, loaders and lifts
- Leased or rented equipment, where added
- Rental reimbursement while covered equipment is repaired, where included
- Installation floaters and builders risk for materials before a project is complete, as separate inland marine forms
What it usually leaves out
- Wear and tear, mechanical breakdown and gradual deterioration
- Theft with no evidence of forced entry, under some forms
- Equipment registered and insured as an auto
- Equipment left unattended outside agreed security conditions
- Liability for injury or damage caused by the equipment, which belongs under general liability or auto
Who typically needs it
- Contractors and trades that carry tools to job sites
- Businesses that own or rent heavy equipment
- Landscapers, electricians, plumbers and HVAC firms
- Businesses whose equipment leases require coverage
What shapes the price
- 01Values and types of equipment
- 02Scheduled versus blanket coverage
- 03Security at job sites and storage yards
- 04Theft and loss history
- 05Deductible and valuation basis
How limits and terms work
Larger items are usually listed on a schedule with a value for each, while small tools may be covered on a blanket basis with a per item limit.
Valuation can be replacement cost or actual cash value, which subtracts depreciation.
Rented equipment coverage often has its own limit and may need to match the rental agreement.
Questions to ask before you buy
- Is every major piece of equipment scheduled at a current value
- Is there a per item limit on unscheduled tools
- Does the policy cover rented and leased equipment
- What security conditions apply to theft claims
Inland marine and contractors equipment questions, answered
Does commercial property insurance cover tools at a job site?
Often only in a limited way. Many property policies focus on your premises and cap coverage for property away from it. Contractors equipment coverage is designed for tools and machinery that travel, so it usually fits better for equipment kept on job sites, in trucks or at storage yards.
Are tools in my work truck covered by commercial auto?
Generally not. Commercial auto covers the vehicle and liability from driving it. Tools and equipment carried inside the vehicle usually need inland marine coverage. Check theft conditions closely, because some policies require signs of forced entry or limit coverage for unattended vehicles overnight.
General information only. Coverage, limits and exclusions depend on the policy an insurer issues and the state where you operate.