Why Standard Property Insurance Isn’t Enough
Tools & Equipment Insurance for Contractors
Typical property insurance only covers tools while they’re at your business location—but as a contractor, your tools move with you. From job sites in Chandler and Mesa to trucks parked in Queen Creek or temporary storage at a build in Gilbert, your tools are exposed to risk every step of the way. Standard property policies don’t cover that. That’s where inland marine insurance—also called contractor equipment insurance—comes in.
What Contractor’s Equipment Insurance Covers
This type of policy protects your tools, machinery, and mobile equipment wherever they go: on a jobsite, in transit, or in off-site storage. Covered events typically include theft, fire, vandalism, and weather damage. Whether it's hand tools, portable power saws, compressors, trailers, or even skid steers and mini-excavators, we’ll help you insure the gear your business relies on. Some policies can also cover leased or borrowed equipment.
When the Unexpected Hits—Covered Scenarios
Imagine your enclosed trailer is broken into overnight at a jobsite in Tempe—your gear is gone. Or a monsoon rolls through Phoenix and floods your storage container, damaging your power tools. In either case, contractor’s equipment coverage steps in to help you recover. Even building materials can be covered before installation (depending on policy terms), though installation floaters may apply in those situations.
Blanket Coverage or Scheduled Equipment—What’s Right for You?
Policies can be written two ways: blanket coverage for smaller, unscheduled tools (typically items valued under $1,000 each), and scheduled coverage for more expensive equipment like heavy machinery. For example, you might carry $15,000 in unscheduled tool coverage and schedule a $25,000 excavator separately. Keeping your list of tools and equipment up to date ensures accurate protection.
Installation Floaters vs Equipment Coverage
Not sure if you need both? Contractor’s Equipment Insurance covers your tools and machines. Installation Floaters protect materials you’ve purchased for a job (like HVAC units or custom windows) before they’re installed. Depending on the way your business operates, you may need one or both—and we’ll walk you through that decision.
Policy Tips to Maximize Your Coverage
We recommend keeping a digital inventory of your tools, including serial numbers and photos. If available, consider opting for replacement cost coverage rather than actual cash value—this ensures you’re reimbursed for what it costs to buy a new tool, not a depreciated value. Most policies also include a deductible (often $500–$1,000), so choose a level that fits your budget and gear value.
How Much Does Contractor Equipment Insurance Cost?
Rates vary, but many Arizona contractors pay just a few hundred dollars a year for basic tool coverage. If you have tens of thousands of dollars’ worth of gear, expect to pay more—perhaps $500 to $1,000 annually. Compared to the cost of replacing stolen or damaged equipment out-of-pocket, it’s a smart investment in your livelihood.
Frequently Asked Questions – Contractor Tools & Equipment Insurance
What does contractor tools & equipment insurance actually cover?
It covers your owned or rented tools, gear, and mobile equipment from risks like theft, fire, vandalism, and accidental damage—whether they’re in your truck, at a job site, or in storage.
Is this the same as my General Liability policy?
No. General Liability covers injuries and third-party property damage—it won’t cover stolen tools or a damaged air compressor. You need this policy to protect your actual equipment.
Does it cover tools left in my truck overnight?
Yes—as long as theft prevention requirements are met (like locked vehicle or storage). But coverage terms vary, so it’s worth reviewing your policy limits and exclusions.
How are tools valued if there’s a loss?
Most carriers offer replacement cost coverage, meaning you’ll be reimbursed for what it costs to replace the tool—not just its depreciated value. Be sure that’s what’s listed in your policy.
Are employee tools covered too?
Some policies can extend to employee-owned tools used for your jobs, but you’ll need to request that specifically. Otherwise, those items may not be included in a standard policy.
What about rented equipment or trailers?
Rented equipment can be covered, either by adding a rented/leased equipment endorsement or through a separate rental policy. Make sure the rental contract doesn’t require you to provide your own coverage.
Protect the Tools That Power Your Business
Don’t let theft, fire, or weather stop your crew from working. Whether you’re hauling gear across the Valley, storing materials in Gilbert, or staging a job in Scottsdale, we’ll help you keep your equipment covered every step of the way.
Request a Contractor Equipment Insurance Quote from JP Insurance Group today.