Contractors Equipment Insurance – There is a particular type of insurance that offer coverage to equipment you use for your company if you work as a contractor. The aim of this insurance policy is to safeguard to contractor’s equipment, machinery and tools wherever they may be used. Moreover, any loss or damage to your equipment will be covered by your business property insurance.
Also, your tools and equipment are only protected in buildings only mentioned in your policy. However, this is a problem for contractors since they transport equipment from one jobsite to another. Regardless matter where they are, contractor needs this insurance policy to protect the equipment from theft or damage. That is exactly what a contractor equipment insurance policy does.
What is Contractors Equipment Insurance
Contractors’ equipment insurance is a particular type of insurance policy made for trade contractors that offers coverage to contractor’s equipment. This insurance policy usually offers coverage for both leased and rented equipment along with equipment your customer owns. It safeguards your client’s equipment from normal perils including wind, fire, lightning, theft and vandalism.
Occasionally, coverage may be expanded to include earthquake and flood damage. However, losses resulting from common wear and tear would not be covered. Maybe the ideal thing about this coverage is that it covers your client’s equipment while it’s being carried on land, stored off-site, or used at a project site. Furthermore, it also offers coverage while the equipment is on-site at a location.
What Does Contractors Equipment Insurance Cover
Generally, contractors equipment insurance safeguards contractors and other equipment owners from a range of risks. This includes equipment malfunction, theft, vandalism, mishaps, and damage from fires, floods, and other events. Furthermore, equipment that is frequently covered includes
- Bulldozers.
- Power shovels.
- Loaders, graders.
- Backhoes.
- Forklifts.
- Excavators.
- Pavers.
- Compressors.
- Pumps.
- Cables.
- Other mobile or portable equipment.
Written on an all-risk basis, most contractor equipment plans cover all risks with the exception of those that are expressly excluded by the policy terms. These plans often cover a variety of potential losses for your equipment, such as theft, flooding, fires, vandalism, and equipment repairs. As equipment is moved from one location to another, this coverage will not end.
What Does Contractors Equipment Insurance Cost
The insurance industry does not employ a single grading system or premium value for contractors’ equipment insurance; instead, the rate is determined by various criteria. The kind of equipment covered, its values, its age, the protection of property. At the same time, it is being stored or on a construction site, deductibles, and loss history are all taken into consideration when calculating insurance rates.
Why Do You Need Contractors Equipment Insurance
You have a significant financial investment in your equipment, and claims do occur. At construction sites, equipment is susceptible to theft and vandalism, and there is a chance that it will be damaged or overturned while in transit. Throughout my career, I have resolved numerous equipment claims, so I am aware that they do occur. In addition, your bank, leasing company, or financing business will want insurance if you have taken out a loan for your equipment.
Does Contractors Equipment Insurance Cover Rented or Borrowed Equipment
Yes, equipment borrowed or rented to and from other people and businesses is covered by most contractors’ equipment insurance. For any one incident, the contractors insurance can offer up to $50,000 in coverage to assist in covering losses to the policyholder’s equipment while it is in the custody of a third party, under contract, or both.
This policy provides up to $100,000 in coverage for damage to the policyholder’s owned property, tools, and gear borrowed, leased, or rented from another person or company. Additionally, companies may be covered for up to $50,000 in liability if leased, rented, or borrowed equipment is damaged during transit by contractors equipment insurance.
Is Every Tool and Type of Equipment Insurable
No. Although the majority of tools and equipment are covered by the policy, some items are not, including:
- Aircraft or aquatic vehicles (drones, boats, planes, etc.)
- Contraband (things that are prohibited in any way)
- Property that is leased or rented to third parties (unless specifically mentioned above)
- Property lent to third parties (unless otherwise specified above)
- Mining operations underground (everything lost, stolen, or damaged while underground)
- Automobiles intended for usage on highways
- Property that is waterborne
This applies to trailers as well as tractors. Even though trailers are frequently used to transport tools, your commercial auto policy should cover them rather than your contractor’s tools policy. Also, tractors are another item that you might classify as equipment, but they would also require auto insurance in order to be covered, not your contractor’s tools policy.
Why Is Contractors Equipment Insurance Important
Tools and equipment that are transported are not covered by standard commercial liability coverage; it only covers items that are kept in one permanent location. Moreover, this is filled by contractors’ equipment insurance, which offers coverage for tools and machinery that are moved from one construction site to another in case of loss or damage.
Final Thoughts
When destroyed or taken, the cost of replacing your tools and equipment as a contractor can be high. Moreover, make sure you locate a contractor’s tools insurance that meets all of your needs, and don’t let their loss stop you from accepting tasks. Call us and one of our specialists will talk over your specific insurance needs to make sure you are insured appropriately.
