Inland Marine Insurance - Coverage for Tools, Equipment, and Materials in the Field

What Is Inland Marine Insurance?

Inland marine insurance covers movable property - tools, equipment, materials, and goods that travel between locations or sit at temporary worksites. Despite the name, it has nothing to do with water. The term comes from maritime insurance history, when marine policies were extended to cover goods moving overland. The name stuck, but the coverage applies to anything on land that is not fixed to a permanent location.

Here is the simplest way to understand where inland marine fits. Your commercial property policy covers what is in your building. Your commercial auto policy covers the vehicle. Inland marine covers everything else - what is inside the vehicle, sitting on the jobsite, or in transit between locations.

You may also hear inland marine called contractors equipment insurance, a tools floater, an equipment floater, or an installation floater. These are all forms of inland marine coverage designed for different types of movable property.

What Inland Marine Covers

Tools and hand equipment. Power tools, hand tools, diagnostic equipment, laser levels, welding rigs, compressors - everything your crew carries to the jobsite every day. These are the items most commonly stolen and most commonly uninsured.

Heavy equipment. Excavators, skid steers, boom lifts, concrete pumps, generators, and other large mobile equipment. Whether you own it or finance it, a single piece of heavy equipment can represent a six-figure loss if it is stolen, vandalized, or damaged on site.

Materials in transit. Pipe, wire, lumber, fixtures, and other materials being delivered to a jobsite. If a load of copper pipe gets stolen off a flatbed or a delivery truck rolls over and destroys $30,000 in electrical fixtures, inland marine covers the loss.

Materials and equipment stored at the jobsite. Once materials arrive at the project, they sit exposed until the crew installs them. Inland marine covers stored materials at temporary locations - your commercial property policy does not, because the materials are not at your permanent address.

Leased or rented equipment. If you rent an excavator or a boom lift and it gets damaged on your jobsite, you are responsible. With the right endorsement, your inland marine policy covers rented and leased equipment. Always check your policy before signing a rental agreement.

Installation floater. Materials you are installing on a project are covered until they become a permanent part of the building. This is critical for trades like electrical, plumbing, and HVAC where you bring expensive materials to a site and install them over days or weeks before the work is complete.

Electronic data processing equipment. Computers, tablets, survey equipment, drones, and other electronic gear used in the field. If a drone goes down on a job or a tablet gets crushed in a work truck, inland marine covers the replacement.

Who Needs Inland Marine?

Contractors of every trade. Your tools and equipment ride around in trucks and sit on open jobsites every single day. Excavation contractors with heavy equipment fleets, electricians with specialized diagnostic tools, HVAC contractors carrying refrigerant recovery machines and gauges - every trade has property that lives outside the building.

Manufacturers and distributors. If you ship goods, store inventory at client locations, or have valuable property regularly leaving your warehouse, inland marine covers those assets in transit and at temporary locations.

Anyone with expensive portable equipment. Surveyors, photographers, event production companies, technology installers - any business where high-value equipment travels to different locations daily.

The common thread: if valuable property regularly leaves your permanent location, you need inland marine. Commercial property insurance stops at your building's walls. Inland marine picks up where property insurance leaves off.

What Inland Marine Costs

Inland marine premiums typically run between 1% and 3% of the total insured value per year. That is one of the more affordable commercial coverages relative to the protection it provides.

A contractor with $50,000 in tools and hand equipment might pay $500 to $1,500 per year. A contractor with a $300,000 excavator on a heavy equipment floater might pay $3,000 to $9,000 per year. A mid-size contractor with a $500,000 combined equipment and tool inventory could be looking at $5,000 to $15,000 annually.

Several factors affect the premium:

• Equipment type and value. Heavy equipment costs more to insure than hand tools. Higher total insured value means higher premium, but the rate per dollar of coverage often decreases as the total goes up.
• Storage conditions. Equipment stored in a locked building or fenced yard costs less to insure than equipment left on open jobsites overnight. Theft is the number one claim on inland marine policies, and secure storage reduces the risk.
• Usage and territory. Equipment used in heavy-duty applications or high-theft areas will carry a higher premium. A skid steer working demolition sites in a major metro area costs more to insure than one doing residential landscaping in a rural county.
• Deductible. Higher deductibles lower the premium. On larger equipment schedules, choosing a $2,500 or $5,000 deductible instead of $1,000 can make a meaningful difference in annual cost.
• Replacement cost vs. actual cash value. Replacement cost coverage pays what it costs to buy the same equipment new, regardless of depreciation. Actual cash value pays what your used equipment is worth today. Replacement cost costs more but is almost always worth it - your 5-year-old excavator costs the same to replace whether the insurance company values it at full price or at a depreciated number.

The Gap Most Contractors Do Not Know About

This is the coverage gap that catches more contractors off guard than any other.

Commercial auto insurance covers the vehicle. It covers liability if you cause an accident, and it covers physical damage to the truck or van itself. It does not cover what is inside the vehicle.

If someone breaks into your locked work truck overnight and steals $15,000 in power tools, your commercial auto policy pays for the damage to the truck - the broken window, the damaged lock. It pays nothing for the tools. Zero. The tools were never covered by auto insurance in the first place.

The same gap applies at the jobsite. Your commercial property policy covers your building, your office, and the inventory inside your permanent location. It does not cover a single thing sitting on a jobsite two miles away.

Inland marine is the only policy that covers your tools and equipment on the road, on the jobsite, in the truck, or in transit. Without it, you are carrying the full risk on every piece of equipment that leaves your shop.

We see this gap every time a contractor calls after a theft. The commercial auto carrier denies the tool claim. The property carrier denies the jobsite equipment claim. And the contractor finds out the hard way that they needed a policy they never knew existed.

How Grit Places Inland Marine

We insure everything from a $5,000 tool package for a one-truck operation to a $500,000-plus equipment fleet for a mid-size contractor. The approach depends on what you own and how you use it.

Blanket coverage for smaller items. For hand tools, power tools, and smaller equipment, blanket coverage insures the entire category without requiring a list of individual items. You report the total value, and the policy covers any tool up to the blanket limit.

Scheduled coverage for high-value equipment. Excavators, boom lifts, concrete pumps, and other high-value equipment get individually listed on the policy with specific values. This guarantees the right payout if a $200,000 machine gets totaled.

Replacement cost as the standard. We place inland marine on a replacement cost basis so you get a new tool or machine - not a depreciated payout that leaves you short when you need to replace it.

Full program coordination. Your inland marine policy works alongside your general liability, commercial auto, and surety program. One agency managing the full insurance program means no coverage gaps and no duplicate coverage. When you add a new piece of equipment, we know exactly which policy it belongs on.

Frequently Asked Questions

Does commercial auto insurance cover my tools?

No. Commercial auto insurance covers the vehicle itself - liability and physical damage to the truck or van. It does not cover the contents. If tools are stolen from your locked truck, commercial auto will not pay for them. You need inland marine insurance or a tools floater to cover tools, equipment, and materials that ride in your vehicles or sit on jobsites.

What is the difference between inland marine insurance and commercial property insurance?

Commercial property insurance covers what is at your permanent business location - your building, office contents, and inventory in your warehouse. Inland marine insurance covers what leaves your location - tools on a jobsite, equipment on a trailer, materials in transit. If it moves between locations or sits at a temporary worksite, it belongs on inland marine.

Does inland marine insurance cover rented or leased equipment?

It can, with the right endorsement. If you rent an excavator or a boom lift and it gets damaged on your jobsite, you are responsible for the repair or replacement cost. Your inland marine policy can cover rented equipment if you add a rental equipment endorsement. Always check your policy before signing a rental agreement, because the rental company's damage waiver often costs more than adding the coverage to your own policy.

Protect Your Tools and Equipment

Your tools and equipment earn every dollar of revenue your business makes. If they are not insured when they leave your building, you are one theft or one accident away from replacing them out of pocket.

Grit places inland marine alongside your full commercial insurance and bonding program - one agency, one team, every policy working together.

Call us directly: (801) 505-5500

Or request a quote online.

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