Installation floater insurance

Installation floater insurance covers movable property, such as building materials, while it’s being installed or built by a contractor during a construction project. This coverage is usually kept active until the materials are installed and put to their intended use, or the work is approved by the client.

Installation floater insurance differs slightly from equipment floater insurance, which covers portable tools and machinery. Both are types of inland marine coverage, which protects the insured items wherever they go.

Installation floater insurance is often purchased by contractors as part of a risk management strategy for theft and other losses during a construction project. You may need it if you work in installation or construction, especially in professions like HVAC installation, electrical work, and renovation.

For example, an electrician might buy this insurance coverage for financial protection against theft of copper wire at a job site.

If your materials are damaged by fire, vandalism, or mishandling, the contractor would be reimbursed for the loss, minus the deductible.

Builder’s risk insurance, also known as course of construction insurance, offers financial protection to construction companies, contractors, and subcontractors from losses at a construction site. It’s a type of property insurance that contractors buy before the building materials arrive and keep in place until the property is sold or turned over to the client.

Builder’s risk is more comprehensive, and typically more expensive, than installation floater insurance. However, some items such as HVAC and electrical systems could be excluded from a builder’s risk policy. A contractor might need to buy an installation floater policy from their insurance company to be fully protected.

Some contractors buy a builder’s risk policy for larger projects, or when they’re the general contractor overseeing a job, and rely on installation floater coverage as needed. Subcontractors might rely on just an installation floater policy, as their risk may be limited to the materials under their control.

Many contractors use both types of insurance to cover property at a temporary job site. Builder’s risk covers the overall project, while installation floater insurance covers building materials and the equipment used to install it.

If a fire or storm destroyed a building under construction, it would be covered under the contractor’s builder’s risk insurance policy. If the drywall, roofing materials, etc. were damaged before or during installation, the loss would be covered by installation floater insurance.

Installation floater insurance covers building materials while they’re under a contractor’s control. This includes hauling materials to a job site, storing them on site, and installing them.

Covered losses include fire, theft, and accidental damage. More extreme events such as earthquakes, floods, or employee theft are usually excluded. Many policies exclude items being transported by air and sea, unless the materials are sent via a regularly scheduled flight, or in the custody of a hired carrier.

Floater insurance might also exclude materials and equipment that do not become part of a specific project, such as various tools and machinery. Table saws, power drills, and items typically carried on a toolbelt or kept in a toolbox would be covered by contractor’s tools and equipment insurance. Work vehicles would require commercial auto insurance.

Other exclusions include:

• Temporary structures such as fencing, scaffolding, or retaining walls
• Buildings and structures that are not part of a construction job
• Landscaping items, such as living trees and plants

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