Equipment Coverage
What is Contractors Equipment Coverage?
What is Contractors Equipment Coverage?
Contractors may use an assortment of tools, equipment, and machinery when working at job sites. Examples include hand tools, backhoes, scaffolding, and portable generators. In the insurance industry, these items are called contractors equipment.
Contractors equipment is different from most business-owned property in that it is mobile. It may be stored on your premises when it not in use but is frequently moved from job site to job site. Most commercial property policies cover buildings and personal property situated at your premises or within a short distance thereof (such as 100 feet). They are intended to cover property at your business location. Most afford little, if any, coverage for items located elsewhere. For this reason, you should not rely on your commercial property policy to cover contractors equipment.
Instead, you should have a specialized insurance policy called contractors equipment coverage.
Contractors equipment coverage can be written alone or added to a property policy (CGL). Some insurance companies provide this coverage and utilize standard policy forms published by ISO or AAIS (an insurance advisory organization similar to ISO). Others use their own proprietary forms.
Leased Equipment
Many contractors rent or lease equipment for specific jobs, a typical lease states that you, the lessee, are liable for any damage the equipment sustains during the term of the lease. Fortunately, many contractors equipment policies include coverage for equipment you lease from others. If you lease property you own to someone else, make sure your policy covers damage that occurs while your equipment is leased to another party.
Added Coverages
Many contractors equipment policies include coverages or extensions not addressed above. Some of these are listed below. Each may be subject to special limits or restrictions.
Newly purchased property
Rental expenses that continue when damaged equipment is no longer usable
Employees' tools
Fire department service charges and the cost to refill equipment
Pollution cleanup
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• Specialty carriers for every industry
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• “Pay What You Want” in Broker Fees