Contractors Equipment Insurance: Protecting Your Most Valuable Business Assets

Your excavator, crane, generator, or specialized diagnostic equipment isn't just expensive—it's essential to your business operations. Contractors Equipment insurance (also called Inland Marine coverage) protects mobile equipment, tools, and machinery that travel between job sites, because losing a key piece of equipment could shut down your business for weeks.

Contractors Equipment insurance covers mobile equipment, tools, and machinery against theft, damage, and other covered losses wherever they're located—on job sites, in transit, or in storage.

When Contractors Equipment Insurance DOES Cover You

Scenario 1: The Stolen Excavator (General Contractor)

Thieves steal your $85,000 mini-excavator from a job site over the weekend. The equipment was locked and had GPS tracking, but the thieves disabled it and the machine disappears.

Contractors Equipment Response: Your policy pays the full replacement cost of a new excavator, minus your deductible. You're back in operation within days instead of months, and don't have to drain your cash flow or take on debt to replace critical equipment.

Scenario 2: The Crane Collapse (General Contractor)

While lifting materials to a second floor, your mobile crane tips over due to soft ground conditions, causing $150,000 in damage to the crane and injuring the operator.

Contractors Equipment Response: Your coverage pays for crane repairs or replacement. The operator's injuries would be covered under Workers' Compensation, but the equipment damage is covered here. Also covers cleanup and removal costs.

Scenario 3: The Transit Accident (HVAC Contractor)

Your trailer carrying $40,000 worth of HVAC units and installation equipment is rear-ended on the highway. The impact damages multiple units and destroys specialized installation tools.

Contractors Equipment Response: Coverage pays for repair or replacement of damaged HVAC equipment and tools. Unlike standard auto coverage, this covers the cargo at full replacement cost without depreciation.

Scenario 4: The Flood Damage (Electrical Contractor)

Flash flooding at a job site submerges your $25,000 cable pulling equipment and specialized electrical testing devices. Everything is ruined by water and mud.

Contractors Equipment Response: Your policy covers replacement of all flood-damaged equipment at current prices, getting you back to work quickly without massive out-of-pocket expenses.

Scenario 5: The Vandalism Attack (Any Trade)

Vandals break into your fenced equipment yard and damage multiple pieces of equipment with sledgehammers and spray paint, causing $60,000 in damage to generators, compressors, and welding equipment.

Contractors Equipment Response: Coverage pays for repair or replacement of all vandalized equipment, plus cleanup costs for graffiti removal.

Scenario 6: The Fire Destruction (Plumber)

A fire starts in your service van and spreads to your trailer, destroying $35,000 worth of pipe threading equipment, drain cleaning machines, and diagnostic cameras.

Contractors Equipment Response: Your policy covers replacement of all fire-damaged equipment. This coverage travels with your equipment, so location doesn't matter.

Scenario 7: The Equipment Breakdown (Any Trade)

Your expensive laser level system suffers an internal electrical failure that can't be repaired, leaving you unable to complete precision work for major clients.

Contractors Equipment Response: If equipment breakdown coverage is included, the policy pays for replacement of the failed equipment, potentially including lost income during the replacement period.

Scenario 8: The Mysterious Disappearance (Electrical Contractor)

Your $15,000 cable fault locator simply vanishes from a job site. There's no evidence of forced entry or theft, but the equipment is gone and never recovered.

Contractors Equipment Response: Most policies cover mysterious disappearance, paying for replacement even when there's no clear evidence of theft.

When Contractors Equipment Insurance Does NOT Cover You

Normal Wear and Tear

Your 8-year-old compressor finally gives out from regular use. Equipment breakdown from normal aging and wear isn't covered.

Poor Maintenance

Your generator seizes because you never changed the oil. Damage from lack of proper maintenance is excluded.

Intentional Damage by Employees

Your angry ex-employee vandalizes equipment before quitting. Intentional acts by employees are typically excluded.

War and Nuclear Risks

Standard exclusions apply for war, nuclear events, and similar catastrophic perils.

Equipment Left Unattended (Policy-Dependent)

Some policies exclude theft of equipment left unattended for extended periods without proper security measures.

Gradual Deterioration

Rust and corrosion that develops over time isn't covered. Only sudden, accidental damage is covered.

Mechanical Breakdown (Unless Added)

Basic policies may not cover internal mechanical breakdown unless you add Equipment Breakdown coverage.

Tools Under Certain Values

Some policies only cover equipment above a minimum value (like $1,000+), excluding smaller hand tools.

Personal Property

Your employee's personal tools aren't covered unless specifically included in the policy.

Special Considerations for Trade Contractors

Scheduling vs. Blanket Coverage

Scheduled Coverage: Lists specific high-value items with individual limits

• Better for expensive, unique equipment

• Covers agreed value, no depreciation

• Higher premiums but guaranteed coverage

Blanket Coverage: Covers all qualifying equipment up to a total limit

• Better for contractors with many similar items

• More flexible for changing inventory

• Lower cost but potential coverage gaps

Mobile Equipment vs. Tools Coverage

Mobile Equipment: Large, self-propelled or towable equipment

• Excavators, cranes, generators, compressors

• Usually covered anywhere in the coverage territory

• Higher limits available

Tools Coverage: Hand and power tools, smaller equipment

• Often has sublimits (like $10,000 total)

• May require tools to be in locked vehicles/buildings

• Consider separate tools floater for high values

Newly Acquired Equipment

Most policies automatically cover newly acquired equipment for 30 days, giving you time to report additions.

Rental Reimbursement

Covers rental costs for replacement equipment while yours is being repaired, keeping projects on schedule.

Debris Removal and Expediting Expenses

Covers costs to remove damaged equipment and expedite replacement equipment delivery.

Coverage Territory Considerations

Nationwide Coverage

Essential for contractors working across state lines.

International Coverage

Some policies extend to Canada or Mexico for border-area contractors.

Transit Coverage

Ensures coverage while equipment is being transported between locations.

The Bottom Line: Equipment Protection for Mobile Businesses

Trade contractors typically have $100,000-$500,000+ invested in equipment, tools, and machinery. A single loss event could:

• Force you to rent equipment at premium rates

• Delay projects and damage client relationships

• Drain cash flow or force expensive financing

• Put you out of business if you can't replace critical equipment

Standard business property insurance often doesn't adequately cover mobile equipment that travels between job sites. Contractors Equipment insurance fills this critical gap by providing:

• Coverage anywhere your equipment goes

• Replacement cost coverage without depreciation

• Protection against the unique risks mobile equipment faces

• Fast claim settlement to minimize business interruption

For trade contractors, your equipment isn't just an asset—it's how you earn a living. When equipment fails, gets stolen, or is damaged, every day without replacement equipment is lost income and potentially lost customers.

Don't let equipment loss end your business. Get Contractors Equipment coverage designed for trade professionals who understand that your tools and equipment are the foundation of your success.