Here's something most home remodeling contractors learn the hard way: your commercial property insurance doesn't follow your tools to the job site. You arrive Monday morning to find your truck broken into and $15,000 worth of power tools gone. You file a claim, only to discover your property policy only covers equipment at your business address. Your tools were in transit, so you're out of luck.
This is where equipment and tools insurance—technically called inland marine insurance—becomes essential. It's designed specifically for contractors whose livelihood depends on equipment that moves. Whether you're driving to a kitchen renovation in the morning or leaving tools at a bathroom remodel overnight, this coverage travels with your equipment.
What Equipment Insurance Actually Covers
Equipment insurance for home remodeling covers your tools, machinery, and materials wherever they are—not just at your shop. This includes protection while equipment is on your truck driving to a job, sitting at a client's house during a multi-day project, or temporarily stored at a job site trailer.
The coverage typically protects against theft, fire, water damage, vandalism, and accidental damage. If someone steals your miter saw from a job site, it's covered. If your drill falls off a ladder and breaks, it's covered. If materials you're storing at a renovation project get damaged by an overnight pipe burst, they're covered too.
Most policies also cover equipment you've rented or borrowed for less than 12 months, which matters when you need a specialty tool for a specific project. Some insurers even provide coverage for employee tools and clothing, typically up to $500 per item or $2,500 per incident. And if your equipment is stolen or damaged, many policies will cover the cost of renting replacement tools while you wait for repairs or reimbursement.
Understanding Scheduled vs. Blanket Coverage
When you get equipment insurance, you'll choose between two approaches—or more likely, use both. Scheduled coverage means listing your expensive equipment individually on the policy with specific values. Your $8,000 table saw gets its own line item. Your $12,000 air compressor gets listed separately. Each piece has its own coverage limit based on its actual value.
Blanket coverage works differently. It insures all your smaller tools as a group under one total limit. Instead of listing every drill, saw, and measuring device, you get coverage for up to, say, $10,000 worth of unscheduled tools combined. The catch: there's usually a per-item limit, often around $500. So your blanket coverage would replace a stolen $300 nail gun, but not a $4,000 laser level—that needs to be scheduled.
Most remodeling contractors use both. Schedule your big-ticket items—anything worth more than $500 or $1,000 depending on your policy. Use blanket coverage for the dozens of smaller tools that would be tedious to list individually. This approach gives you comprehensive protection without drowning in paperwork every time you buy a new cordless drill.
Why Theft Protection Matters for Job Sites
The statistics are sobering: construction companies lose somewhere between $300 million and $1 billion every year to equipment theft. Remodeling contractors are particularly vulnerable because you're working in residential neighborhoods, often leaving equipment at job sites overnight or in your vehicle parked on the street.
Your equipment insurance covers theft from job sites, from your vehicle, from storage facilities, and even from your home if you keep tools there. The location doesn't matter—if it's stolen, you're covered. This is critical because homeowners typically aren't responsible for contractor equipment theft, even if it happens on their property during a project.
Some insurance companies offer incentives for theft prevention. Install GPS tracking devices on your equipment, and some insurers will waive your theft deductible entirely. The tracking device needs to be operational and the equipment needs to be scheduled on your policy, but this can save you hundreds or thousands of dollars if theft occurs.
How This Differs from Commercial Property Insurance
You might already have commercial property insurance and wonder why you need another policy. The difference comes down to one word: location. Commercial property insurance protects equipment and inventory at your listed business address. The moment you load tools into your truck and drive away, that coverage stops.
Inland marine insurance—the technical name for equipment insurance—was specifically created for businesses with mobile property. The name is confusing (it has nothing to do with boats anymore), but the concept is simple: it covers business property that travels. For remodeling contractors who rarely work at their business address, this is the coverage that actually matters.
Some contractors discover this gap the hard way after a loss. They assumed their business insurance covered everything, only to learn their tools weren't protected once they left the shop. This is why most insurance agents recommend inland marine coverage for any contractor whose equipment leaves the business premises regularly.
What to Expect for Cost and Coverage
Equipment insurance for remodeling contractors typically costs between $38 and $63 per month, with most contractors paying around $49 monthly. The exact cost depends on the total value of your equipment and the type of work you do. A contractor with $50,000 in scheduled equipment doing demolition work will pay more than someone with $15,000 in tools doing finish carpentry.
Your deductible also affects your premium. Higher deductibles mean lower monthly costs, but more out-of-pocket expense if something happens. Most contractors choose deductibles between $500 and $2,500 depending on their risk tolerance and cash flow. Remember that some insurers waive deductibles for GPS-tracked equipment, which could influence your decision.
The coverage limit should match your total equipment value. Sit down and actually inventory what you own—trucks, trailers, power tools, hand tools, ladders, scaffolding, everything. Most contractors underestimate this number significantly. If you have $40,000 in equipment but only carry $25,000 in coverage, you'll be underinsured if a major loss occurs.
Getting Started with Equipment Insurance
Start by creating a detailed equipment inventory. Take photos of everything, note serial numbers, and record purchase prices or current replacement values. For scheduled items, you'll need this information anyway. For blanket coverage, it helps you understand whether your limit is adequate.
When shopping for coverage, ask specifically about job site protection and theft coverage. These are standard features, but confirm they're included. Ask about coverage for rented equipment, materials at job sites, and whether there are any exclusions for specific types of work you do. Some policies exclude certain high-risk activities or limit coverage in specific situations.
Consider bundling your equipment insurance with other business policies. Many insurers offer business owner's policies that combine general liability, commercial property, and inland marine coverage at a discount compared to buying each separately. This simplifies your insurance management and often saves money. For remodeling contractors, protecting your tools isn't optional—it's protecting your ability to earn a living. One significant theft or damage event without insurance can put you out of business. With the right equipment coverage in place, you can focus on the work instead of worrying about what might happen to your tools at the next job site.
