Don’t Let Equipment Downtime Cost You: How Tool & Equipment Coverage Protects Your Business

When essential equipment is damaged or stolen, the resulting financial hit can impose consequences well beyond the direct cost of replacing it. The losses arising from stalled productivity, delayed jobs and unhappy clients can amount to significant and even devastating sums. With this in mind, tool and equipment coverage should be considered a core component of contractors insurance.

How Does Tool & Equipment Coverage Work?

As its name suggests, this type of coverage is designed to financially protect the portable machinery, tools and equipment your business depends on for delivering services and completing jobs. Depending on policy specifications, coverage may include:

• Theft of tools from a job site, vehicle or storage area
• Accidental damage to covered equipment, such as drop incidents
• Rental reimbursement for a replacement while a covered item is being repaired or replaced
• Coverage for leased or rented equipment that your crew uses on the job

Coverage details vary, so reviewing your specific policy for limits, exclusions and deductibles is always a good idea.

Why Is It Important?

If your work depends on physical tools or equipment, this coverage should be a top priority. Contractors, plumbers, electricians, landscapers and similar trades professionals may be in particular need of robust coverage. Additionally, tool and equipment coverage may be especially essential for smaller operations, which may face more extensive disruption when key equipment goes down unexpectedly due to a lack of additional inventory available and financial resources on which to fall back.

You should not assume that standard commercial property insurance is sufficient for financially protecting your tools and equipment, as such policies typically only cover such assets while they’re at your place of business. As such, if a key piece of equipment is stolen from a job site or damaged while in transit, alternative coverage, such as that available through inland marine insurance, would be crucial.

Protect What Keeps Your Business Moving

Contact Varon Insurance today to learn about tool and equipment coverage options and compare personalized quotes.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.