Tools & Equipment Insurance for Contractors

If your tools and equipment leave a fixed location — to a job site, a truck, or a client's property — a standard property policy often won't follow them. Tools & equipment insurance, a form of inland marine coverage, is what protects gear on the move.

Short answer: Tools & equipment insurance (an inland marine policy) covers the hand tools, power tools, and movable equipment a contractor uses at job sites and in transit — losses like theft from a truck, damage, or fire — that a building-bound property/BOP policy typically excludes once the property leaves the premises.

What it covers

  • Hand & power tools — the gear you carry job to job, whether owned or sometimes borrowed/rented.
  • Larger equipment — compressors, generators, trailers, and small mobile machinery (often called contractor's equipment).
  • In transit & at the job site — coverage follows the property off your premises, including theft from a locked vehicle (subject to policy terms).
  • Rented or borrowed equipment — many policies can extend to equipment you rent or lease, which contracts increasingly require.

Scheduled vs. blanket — and what it doesn't cover

  • Scheduled — you list higher-value items individually by description and value; best for expensive, identifiable equipment.
  • Blanket / unscheduled — a single limit covering small tools as a category, with a per-item cap; simplest for a van full of hand tools.
  • Common exclusions — normal wear, mechanical breakdown, and (often) employee theft without an endorsement. Leased heavy machinery may need its own equipment floater.

What drives the cost

  • Total values — the replacement cost of everything you want covered sets the limit and the premium.
  • Per-item limits & deductible — higher single-item caps and lower deductibles raise the price.
  • Trade & theft exposure — high-theft tools and how/where they're stored overnight matter.
  • Bundling — often added to your contractor program alongside general liability for credits.

See how this fits the bigger picture on the contractor insurance cost guide and the contractor overview.

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FAQ

Isn't my equipment already covered by my property or BOP policy?

Usually only while it's at your insured location. A BOP or property policy generally stops covering tools once they leave the premises, which is exactly when contractors use them. Inland marine fills that gap.

Does tools & equipment insurance cover theft from my truck?

Typically yes, subject to your policy's terms — commonly requiring the vehicle to be locked and sometimes excluding overnight street parking. Always confirm the theft conditions on your specific policy.

Should I schedule my tools or use blanket coverage?

Schedule high-value, identifiable items so they're insured to their actual value; use a blanket limit for the many small tools that would be impractical to list individually. Many contractors use both.

Educational information only; not a quote or coverage advice. Coverage terms, limits, and exclusions vary by policy and carrier, and your actual protection depends on the specific form you buy. Focus West Insurance Solutions, San Diego, CA (CA Lic. #0M32679). Related: contractor overview · inland marine (glossary) · contractor quick quote.