Contractors need their equipment and tools to do their work, and these pieces need to be sufficiently protected. Fully protecting contractor equipment and tools requires several insurance coverages. Here are the business insurance coverages to look for if you're in the contracting field.
Commercial Content Coverage for Onsite Protection
Commercial content coverage may be sold on its own or as part of a more comprehensive commercial property coverage policy. In either case, commercial content coverage protects items that a business owns and keeps on its main premises.
For a contractor, commercial content coverage will insure large and small equipment when it's kept at a central facility. The facility may be an office, workshop, warehouse, or any other main location. An important limitation to be aware of is that commercial content coverage only protects equipment when it's actually at a business's location. Off-site protection isn't available through this coverage.
Inland Marine Coverage for In-Transit Protection
Inland marine coverage extends protection to when equipment and tools are in transit. This coverage is needed to insure equipment when it's taken to a job site, from a job site, or between job sites.
Both large and small contractors should have inland marine coverage, for all contractors have expensive equipment. This coverage can be used to insure a large number of hand tools that have a high total value, and the coverage can also insure a single, major piece of equipment like a backhoe.
Builders Risk Coverage for Job-Site Protection
Once equipment and tools are on an actual job site, the equipment needs to be protected with builders risk coverage. This is similar to commercial content coverage, except it provides coverage specifically when equipment is on a job site instead of when the equipment is at a main facility.
Equipment Breakdown Coverage for Unexpected Malfunctions
Equipment breakdown coverage differs from other business insurance coverage in two important ways. First, equipment breakdown coverage isn't limited to only one location or situation. Second, the coverage doesn't guard against theft or unexpected damage.
Instead, equipment breakdown coverage protects against unexpected breakdowns of essential equipment. This coverage is reserved for only large and essential equipment that a contractor can't work without. Should a covered piece of equipment malfunction, the coverage will pay for emergency repairs or will pay the salary of an employee who fixes the equipment.
Because equipment breakdown coverage is purchased for only essential pieces of equipment, it's usually bought for one piece of equipment at a time.
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