Tool insurance

Anyone carry it? One of my customers had a shop burn flat over the weekend and a mechanic who has worked there almost 30 years lost everything. Multiple toolboxes full of stuff and cabinets full of odds and ends. I’d guess $40k plus. He had no insurance on his tools. At this point the best he can hope is that his employer steps up and helps him out. Really got me thinking. My truck is insured but my tools are not and I think I’ll be looking into it.

It would be a good ideal. I tryed to at the first shop i worked at back in the 80s but couldnt find some one to insure my stuff.

Check with your homeowners insurance, they might be able to cover your tools. If you have the money, you can find insurance.

It's called an Inland Marine Contractors equipment policy. I have had this rider on my GL policy since I've owned businesses over the last 25 years.

The coverage is cheap considering commercial auto and GL. Mike I highly suggest you ask your insurance agent about it and take it out if possible.

Back in the mid 2000's I was hit by a bunch of vandals and thieves that broke into the tool trailer and stole the chest of Wright tools, the engine off our hydroseeder, emptied a fire extinguisher into the dump truck's fuel tank among other nefarious things - I was ready to dig a deep hole and send some lead at high velocity but our Inland Marine policy paid us $15K to make it right.

There was a company out of New Jersey that I spoke with a while back and $50k was like $10/mo otherwise all the insurance companies said it would be under your general policy with whatever your deductible was

years ago I new nothing about insurance . But after loosing all in fire I learned a lot . Most importantly coming from a owner employee tools are hard to insure because owner has no control over them. So if you work somewhere an they say you insurance unless you have copy of policy in your hand and read it ( make sure you read fine print there might be 100000 coverage but it my be split between all employees)
You most likely don’t have coverage not that your boss lied to you he probably doesn’t understand it good . I was able to make it work for employees with parts in coverage for property of others an rest out of company pocket. Not that I am a expert but I went though long expensive school of hard knocks on this one !!!

John Canfield said:

Check with your homeowners insurance, they might be able to cover your tools.

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I think Mike L is a licensed business, and as such, I don't think his homeowners is going to cover his business tools. But he can easily fall under a inland marine like CM1995 suggests. I think my tools at my shop are covered up to 50k.

crane operator said:

I think Mike L is a licensed business, and as such, I don't think his homeowners is going to cover his business tools. But he can easily fall under a inland marine like CM1995 suggests. I think my tools at my shop are covered up to 50k.

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If you purchased the tools and listed them as company assets, your home owners will only give you their sympathy. My work trailer was stolen out of my yard years ago so I have experienced that. If you are an employee and your tools are located in your employer's shop building, depending on state laws the employer may be on the hook for the loss. That is if you have a list of tools on file when you became an employee. I have been told a garage or automotive shop policy will cover most all the risks, like fire, theft and such. I would think there might be exclusions though, earthquake, flooding, riot, insurrection or war. I have worked at a company in the past where a field mechanic had all the tools stolen out of his truck and the company reimbursed him. Shortly after, there was a requirement for submitting a tool list. Inland Marine is usually the term used for covering things in transit and/or special items like jewelry, fine art, fire arms and such that cannot be covered under a standard home owner policy. That would be a separate policy added to a home owner policy and those items would be scheduled.

If you wish to get that stuff covered, make sure you get a senior agent or broker and read the policy very carefully as there will be conditions imposed and specific provisions as to what they will pay and what you will be required to do to get payed. Read the definitions very carefully, especially the term "mysterious disappearance."

My contractors general liability policy has coverage for both shop and truck tools.

I was talking to a guy that worked at a IH case dealer shop. They got broke into the only tools they got were his because they were close to the door. He had alot of so so tools. He made a list of the tools he had but didnt think about what kind they were the companys insurance told him to call a tool truck and replace what he had so he had every thing snapon. They got broke in agin i dont remember just what happen but after that he had a even better tool box.

Do you have to itemize every tool for the insurance company or do they typically just ask for a total value for all tools and call it good?

92U 3406 said:

Do you have to itemize every tool for the insurance company or do they typically just ask for a total value for all tools and call it good?

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My insurance company asks what amount I want covered for. No itemized list. I have pictures because my memory isn't great. I only get what I'm covered for in event of a loss, if I'm underinsured its on me.

I've never asked about employee owned tools, because I've always supplied all the tools.

Never tell your insurance company you are underinsured. Typically, you are required to carry insurance on at least 80% of the value of the insured item. But lets say you have $10,000 in tools, and you insure them for $10,000. Well, during the next few years you add $3,000 worth of tools. You have good records, so you know what you have. You lose the tools. Your insurance company asks for a list, so you give them one. Prices have gone up, as well, so you come up with $14,000 of loss. The insurance company says you are only insured for 71% of the value, so you are classed as a co-insurer of 29%. Your policy is for $10,000, you co-insured 29%, so the insurance company pays you $7100.

Has you submitted a list showing $10,000 in losses, you would have received a check for $10,000.

That's why you read your policy! There might also be a clause in the "what we will pay section" that mentions how they will pay for used stuff. Do they pay replacement cost less depreciation? Do they pay directly of reimburse your expenses?

My policy is for replacement value up to $10,000. Using replacement value I would exceed it very quickly in a fire. More difficult in a theft as a lot of these tools are very heavy. Could probably get close in a half hour picking and choosing all the Snappys and leaving heavy or low value tools.

i checked into it about 30 years ago and it was very expensive. i also had to have a complete inventoried list as well as a copy of the original purchase invoice for each tool. at that time, it wasn't worth the hassle. when we relocate in the next couple of years i will probably check into it again because of the shop equipment value as well as some of the specialized hand tools

Start out with HF, no one steals it, not worth the hassle of insuring and brings more at auctions than it cost new.

Sberry said:

Start out with HF, no one steals it, not worth the hassle of insuring and brings more at auctions than it cost new.

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the best thing I ever found at horrible freight was the exit!

I do like their wire brushes.

John C. said:

Inland Marine is usually the term used for covering things in transit and/or special items like jewelry, fine art, fire arms and such that cannot be covered under a standard home owner policy. That would be a separate policy added to a home owner policy and those items would be scheduled.

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John we just renewed our $55K per year bundle of commercial auto/equipment, GL and WC. Our GL policy includes an Inland Marine policy covering our small hand and power tools was included. I have always had a commercial Inland Marine policy which has paid off in the past. Maybe an Inland Marine policy is something different out west but here in the Southeast it covers a blanket of small items in a commercial policy.

Inland Marine is pretty cheap and should be an available rider on most commercial auto/equipment policies.

The smallest item we list on our scheduled equipment is our trench rollers, all other smaller equipment/tools is covered under our Inland Marine which is capped at $15K per occurrence. Our deductible is $1,000 so if a rescue saw gets stolen for example there would be no reason to file it. However if they stole one our job boxes with gas air comp, generator, rescue saw, etc that would be a claim.