What is contractor equipment insurance?
You require a lot of equipment in order to carry out your work as a building contractor efficiently. Most contractors are aware that they will require a range of insurance plans to protect themselves against liabilities and legal action.
Nevertheless, many contractors are surprised to find that standard commercial property insurance coverage does not always provide coverage for certain types of equipment that are transferred from one work site to another.
Because of the nature of their profession, contractors face numerous risks, and any significant equipment loss could put them out of business.
One essential item you’ll need to finish your work is your tools. Thankfully, contractor equipment insurance may protect you from having to pay for the independent replacement or repair of destroyed or damaged equipment.
The Essentials of Contractor Equipment Insurance
A comprehensive coverage that is typically added to your business insurance policy to protect against equipment that is lost or destroyed during transportation is contractor equipment insurance, also known as equipment floater insurance. These insurance plans protect against physical damage and loss to portable machinery and equipment. You can also modify your policy to obtain the exact coverage you desire.
Depending on what you have, you can extend coverage to include small tools or clothing. Since they bring their equipment to every customer location they visit, carpentry and plumbing businesses benefit from this type of coverage. The $50,000 annual maximum coverage amount is typically well worth the $50 annual premium for contractors.
Your equipment is often protected by business insurance (up to a specified value) as long as it stays in a fixed location. Nevertheless, equipment that is transportable or traveled by contractors will not be covered, such as:
- Bulldozers, concrete mixers, or forklifts
- Hand tools and extra replacement parts
- Cables, generators, or compressors
- Derricks and draglines
What is covered by insurance for contractor equipment?
Contractor equipment insurance typically covers tools and equipment up to replacement cost. The specific coverage could change based on your insurance.
Most contractor equipment plans are written on a “all-risk” basis, meaning that they insure against all risks save those that are specifically stated to be excluded under the terms of the policy. Many potential losses for your equipment, including theft, flooding, fires, vandalism, and equipment maintenance, are frequently covered by these insurance. This coverage will not Planned Protecti Coverage of Blankets or blankets when equipment is moved from one place to another.
When comparing bids, contractors’ equipment coverage Planned Protections schedCoverage of Blanketslanket coverage, or both. Before you purchase your policy, make sure you understand these options.
Scheduled Coverage
Under scheduled coverage, only items that are listed in a schedule that has been mutually agreed upon are covered. The insurer either keeps or adds a list of particular items to the original policy. Most of the time, you can add freshly purchased equipment to the coverage after the policy is created.
Blanket Coverage
This type of coverage extends to any items that meet a predefined criteria of “covered property”. Whether or whether your property is listed in a schedule, as long as it falls within its predetermined boundaries, it will be covered.
To offer sufficient coverage, the majority of contracting companies combine scheduled and blanket coverage. When purchasing a plan, be sure to carefully go over with your insurance broker the sorts of items and equipment you require protected. You should give as much information as you can, such as the equipment’s maker, model, serial number, and approximate value.
Extra Things to Think About When Purchasing Contractor Equipment Insurance
When comparing insurance, you should also look for the following coverage elements. Some of these may already be covered by insurance. You might need to add more people through an endorsement, depending on your requirements.
Employee Clothing and Tools
It’s likely that your contractor will insist on your staff buying their own uniforms and gear. Verify that your employees are covered by the equipment policy that your contractors have in place. It is probably going to be covered as well, but it will depend on the specifics of your policy. Your policy will specify how much your insurance company will pay.
Gear that is borrowed, leased, or rented
It might not always be practical for you to own every piece of equipment you use in your capacity as a contractor. There may be occasions when your business must rent, lease, or borrow its equipment from outside sources.
In most cases, you are responsible for any damage that occurs to equipment while it is being rented. Thankfully, rental equipment is often covered by contractors’ equipment insurance.
Rent Reimbursement
If your rented equipment is destroyed, the majority of insurance providers will cover additional expenses related to the claim, such as renting or leasing equivalent equipment. The majority of contractors and construction companies have the essential protection provided by equipment insurance.
To ensure that you are always adequately insured, make sure you discuss with your broker the precise tools and equipment your business uses on a regular basis before purchasing your contractors’ equipment coverage.
Right Now, Get Contractor Equipment Insurance
Purchasing Contractor Equipment Insurance is one way to prepare for the impact of a potential threat to your business.
Contact a business insurance specialist in your area right now, and they will be able to tailor your cyber insurance policy to your unique needs.
