Heavy equipment insurance is a broad term that basically means the coverage you get to specifically cover any equipment that gets damaged or goes missing during a job. that may sound simple, however, it can cover more than that. You can get coverage for loss, employee equipment, borrowed tools, clean up, and much more.
Types of Heavy Equipment Coverage
Within heavy equipment insurance coverage contractors have some options. The ideal coverage options allow a contractor to easily replace damaged or stolen equipment without cost after the deductible.
Operating risk refers to any damage that happens while the equipment is in operation or being transported. Things like fire, theft, weather, and more are covered.
What About Leased Equipment?
If you lease equipment for a job you may be held liable if the machine is damaged. Many times your contractor’s policy will not protect you.
If you lease heavy equipment you should check with the company you are renting from, you may be required to get insurance on that piece of equipment. You can add a rental policy to your Marine Coverage, and you will be covered for sure.
Can You Loan Equipment?
Every contractor should speak with their insurance agency and find out if they can loan heavy equipment. You want to confirm your existing policy will cover a machine if you were to loan it out.
Generally, insurance companies frown upon this. Certain policies will allow it, but you must confirm before engaging in such activities.
Will Your Current Heavy Equipment Insurance Policy Protect You If Something Bad Occurs?
There should be no such things as a one-size-fits-all heavy equipment insurance policy. Contractors have unique needs and require specialized insurance offerings to meet the demand within the industry.
As a contractor or company within the construction industry, it’s imperative you dive into your current policy and see if there are any gaps.
Here is an example:
A contractor leased a piece of equipment for a job and failed to add Equipment Rented Coverage on their policy. The equipment was destroyed by vandals. The contract with the rental company required the contractor to protect/cover the equipment.
The Result: The Contractor paid in full out of pocket!
