Tools and equipment insurance

Tools and equipment insurance covers small tools and movable equipment wherever you take them. It pays for repair or replacement in the event of damage, theft, or loss.

A wide range of tools, equipment, and cargo are covered under this policy, from hammers and saws to laptops and lawn mowers. Specific items valued at over $2,500 may need to be listed separately as scheduled items, which cost more to insure.

Tools and equipment insurance is sometimes called inland marine insurance or equipment floater insurance.

Standard commercial property insurance policies, including business owner's policies (BOP), only cover items at the business address listed on the policy. Without additional coverage, you'd end up paying for losses out of pocket if cargo or equipment is stolen from a truck, or if your company's storage unit is destroyed in a fire.

Tools and equipment insurance provides coverage for your business property wherever it goes, including at jobsites, in transit, and stored off-site. It offers crucial financial protection for any business that has valuable property outside of its office.

With a tools and equipment insurance policy, you can get back to work fast after theft or other losses. It's especially important given the recent escalation of cargo theft, which costs over $200,000 per incident on average.

Tools and equipment insurance protects hand tools, power tools, machinery, and other equipment that moves from place to place. Some insurance companies may require the items to be relatively new and inexpensive, or list high-cost items separately on the policy.

Tools insurance policies cover a variety of items and incidents, including the following:

A standard commercial property policy won't cover tools in transit or equipment stored at a worksite. It’s risky to move items and store them off-site, which is why you may need additional coverage.

In construction and similar industries, a wide range of tradespeople and other professionals need coverage for tools and equipment brought to jobsites. Here, this coverage is called contractor's tools and equipment insurance.

Both small business owners and independent contractors should consider carrying this coverage to protect against unexpected losses.

Businesses that often need tools and equipment insurance include:

Complete Insureon’s easy online application today to get tools and equipment insurance quotes from top-rated U.S. providers. Our expert insurance agents can help you find the best coverage for your small business's unique needs.

Once you find the right policies for your business, you can get coverage quickly and receive a copy of your certificate of insurance in less than 24 hours.

Tools and equipment insurance is ideal for businesses that operate on a small budget. However, it doesn't cover every instance of property damage, and it's not designed for certain types of equipment.

Here are a few examples of common exclusions:

If you're a small business owner in a low-risk industry, you may be able to add tools and equipment coverage to a business owner’s policy instead of buying standalone coverage.

A BOP bundles general liability coverage with commercial property insurance at a lower price than buying these policies separately. Some insurance providers will let you add business interruption insurance to a BOP, which helps your business recover from downtime caused by a fire or other covered property claim.

Tools and equipment insurance and inland marine insurance refer to the same type of coverage for portable items owned by your business.

Within this category, you can buy unscheduled or miscellaneous coverage for equipment valued under $2,500 (or up to $5,000, depending on the insurer), such as lawn mowers, saws, and drills. High-value items, such as excavators, bulldozers, and backhoes, would be scheduled separately on the policy and would cost more to insure.

There's also equipment breakdown insurance, sometimes called boiler and machinery insurance, which is designed for commercial equipment or machinery that suffers an unexpected failure.

If you're unsure which insurance product you need, a licensed insurance agent can answer your questions and help you find the right policy.

Equipment floater insurance is another term for tools and equipment insurance or inland marine insurance. It's called "floater" insurance because the coverage isn't tied to a specific location, but travels wherever you go.

A similar type of property coverage, installation floater insurance, specifically covers building materials, supplies, and appliances at a jobsite before they are permanently installed.

There's also a related auto insurance coverage called a mobile equipment endorsement. This extends your auto insurance to cover tractors, forklifts, and other mobile equipment driven on public roads.

Yes, independent contractors and sole proprietors often benefit from contractor's tools and equipment coverage. Any business owner who travels with valuable equipment or works off-site should carry this coverage.

For example, an independent contractor who specializes in pressure washing would need coverage for the machines and accessories they bring to clients' homes and offices. Similarly, a sole proprietor who owns a swimming pool business would rely on contractor's tools and equipment insurance for their pipe cutters, trenchers, saws, and drills.

Even if you have homeowner's insurance, it won't cover business personal property—and standard commercial property insurance won't cover items outside of your main business location.

Yes, tools and equipment insurance can cover rented, leased, and borrowed items, such as a scissor lift that a painter rents for a project. Items in your care, custody, or control are excluded from general liability insurance, which is why you may need additional coverage.

Even if you work for an employer, you can't necessarily rely on them for coverage for your own tools. Contractors and subcontractors who use their own tools or who rent or borrow tools should consider carrying their own contractor's tools and equipment coverage to make sure they're financially protected.

Yes, business insurance is typically tax deductible. The IRS allows tax deductions for business expenses that are ordinary and necessary, which includes many types of commercial insurance.

For example, a woodworking shop that's protected by a business owner's policy can deduct that cost from their annual taxes. If the shop also carries tools and equipment insurance for off-site carpentry jobs, it can deduct the cost of that policy as well.