Cover your day-to-day rental operations with equipment rental insurance.
Who needs equipment rental insurance?
Any equipment rental company or an equipment dealer that rents out equipment for others to use in their projects needs equipment rental insurance.
How Equipment Rental Insurance Works
Equipment rental insurance offers financial protection for rental companies by helping reduce the risk of damage or loss when expensive equipment changes hands. It covers a wide range of potential risks and helps shield businesses from the financial burden of repair or replacement.
Rental Business Insurance Can Protect Your Business Financially
When you rent out heavy equipment or other valuable tools, you open your business up to financial losses. Accidental damage, misuse, and theft can result in costly equipment damage. An equipment rental insurance policy helps mitigate those risks by providing a level of protection tailored to the nature and value of the inventory.
Insurance for Rental Equipment
This type of insurance covers more than the equipment itself. It provides protection against loss or damage caused by the client, during transport or storage, or due to poor condition. It can also include liability coverage for injuries or property damage resulting from the rented equipment.
The Cost of Insurance Varies Based on Coverage, Location, and Equipment Type
Premiums for a rental equipment insurance policy depend on several factors. These include the types of insurance selected, the value and type of equipment, the location where it’s used, and the level of protection. Our knowledgeable agents can help you get the right coverage at a competitive rate.
Examples of the Types of Equipment That Can Be Covered
- Tools and hand power equipment: This includes drills, saws, sanders, and more.
- Heavy machinery and construction equipment: This can be backhoes, forklifts and loaders.
- Audio and video recording equipment: This covers cameras, microphones, and mixing boards.
- Party supplies: You can even cover flatware, tables, and serving trays.
Investing in rental equipment insurance can help you operate more confidently and protect your bottom line.
What does rental equipment insurance cover?
While precise coverage options are needed for the specific equipment you rent out, there are some coverages your business will need regardless. Above all else, a commercial property insurance policy is essential. This covers everything from buildings your business occupies such as offices and warehouses, to contents and rental items. General liability insurance provides coverage in the event you or your employees cause injury or property damage. In addition, inland marine insurance extends coverage to your equipment while it is both on and off your property.
Risks in the equipment rental industry.
There are many risks unique to the equipment rental industry that you’ll need to account for when finding insurance coverage for your business. For example, if you were to rent out equipment to a customer who didn’t know how to properly use it and they injured someone or damaged property, your business could be held liable for renting it out to an unskilled person. Similarly, a customer could lend your equipment to someone else before giving it back to you, in which case you could still be responsible for injuries or damage caused by your equipment. Or what if a customer failed to return rented equipment? In that instance, you’d need to pay replacement costs to keep your business running smoothly.
The most common insurance for equipment rental companies.
Operating an equipment rental business involves various risks, making insurance coverage essential to protect your assets, employees, and customers. Below are the most important insurance coverages to consider.
Commercial Property Insurance
Covers damages to your building and business contents due to fire, theft, vandalism, or natural disasters.
Example:
Your warehouse and its contents are damaged in a storm, or rental equipment that you store on-site is stolen.
General Liability Insurance
Protects against third-party claims for bodily injury, property damage, or personal injury that occur on your premises or are caused by your equipment.
Example:
A customer trips over a piece of equipment in your store and sues for medical expenses.
Equipment Insurance (Inland Marine)
Protects equipment that you rent out to others while in transit or at a client’s location.
Business Auto Insurance
Covers vehicles used to deliver equipment to customers or transport it between locations.
Example:
An accident involving a delivery truck results in damages or injuries to your vehicle and other people.
Workers’ Compensation Insurance
Covers medical expenses, lost wages, and rehabilitation for employees injured on the job.
Example:
An employee gets injured while loading heavy equipment onto a delivery truck.
Business Interruption Insurance
Compensates for lost income if your business operations are interrupted due to a covered event.
Example:
A fire damages your premises, causing a temporary shutdown of operations.
Professional Liability Insurance
Covers claims arising from errors or omissions in professional services, such as providing incorrect instructions on equipment use.
Example:
A customer claims they were injured due to improper training provided by your staff on using rented equipment.
Cyber Liability Insurance
Protects against losses from data breaches, or cyberattacks. This is especially important if you store customer data digitally.
Example:
A hacker accesses customer credit card information from your online booking system and demands that you pay a ransom.
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Things to consider when insuring your equipment rental business.
What you rent out does matter, and there’s a big difference between a company that rents out bicycles and another that rents out cranes. The people who rent from you also matter. If you rent out heavy machinery, you need to know that the people using it are capable and insured. The length of time you rent out equipment is another factor, as the risk of damage or loss of equipment increases the longer it is out of your hands. If it’s expensive equipment that needs to be rented out for an extended period, you might even want to require them to take out a renters liability insurance policy to cover your equipment further. Finally, it’s important to have and understand what’s in the legally binding rental contract you have your customers sign. This may include things like what the customer is responsible for and whether they need to take out additional coverage.
How much does equipment rental insurance cost?
The cost of your policy may vary depending on the type of equipment you rent out, the location of your business, and the scale of your operations.
Other equipment rental business insurance you may need.
The specifics of your business operations determine the types and amount of coverage you should have. For example, if you have employees, you may want to consider Employment Practices Liability Insurance (EPLI) to protect you against losses from employment discrimination lawsuits. If you want to have even more coverage in the event that your limits are reached on your other policies, a commercial umbrella insurance policy may fill in those gaps.
Are you ready to protect your equipment rental business with an insurance policy? Contact us to discuss your coverage options.
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