Here's a scenario that catches business owners off guard: Your commercial property insurance covers the $50,000 worth of equipment sitting in your warehouse. But the moment your crew loads that equipment onto a truck and drives to a job site? Your coverage stops. That laptop your employee carries to client meetings? Not covered. The inventory you're shipping to a customer? You're on your own.
This is where inland marine insurance comes in—and despite its confusing name, it has nothing to do with boats. Understanding the difference between commercial property and inland marine insurance could save your business from massive financial losses. Let's break down what each policy actually covers and why most businesses need both.
What Commercial Property Insurance Actually Covers
Commercial property insurance is straightforward: it protects your building and everything inside it at your listed business address. This includes the structure itself—walls, roof, foundation, electrical and plumbing systems, HVAC—plus your business personal property like office furniture, computers, inventory, and equipment that stays put.
The key word here is "fixed." Commercial property insurance is designed for stationary assets at a specific location. If fire damages your office, if a storm tears off your roof, if thieves break in and steal equipment—you're covered. But the protection is geographically limited to your business premises.
Most policies include a proximity requirement. Industry experts note that commercial property insurance typically stops covering tools and equipment once they're more than 100 feet away from your premises. That's not a lot of distance. If you're a contractor who stores equipment at your shop but uses it at job sites across town, commercial property insurance won't help when that equipment is stolen from a work location.
Why Inland Marine Insurance Has Such a Weird Name
The name "inland marine" sounds like a mistake, but it has historical roots in maritime shipping insurance. Centuries ago, insurers covered cargo on ocean voyages. As commerce evolved and goods started moving overland via trains and trucks, insurance companies extended similar coverage for "inland" transport—hence the name that confuses everyone today.
Modern inland marine insurance covers business property that's mobile, in transit, or temporarily located away from your main business address. Think of it as coverage that travels with your property. When your contractors take tools to job sites, when you ship products to customers, when employees work remotely with company laptops—inland marine insurance follows that property wherever it goes.
These policies are often called "floater" policies because the coverage floats with the insured property. You're protected whether your equipment is in your truck, at a client's location, temporarily warehoused by a third party, or anywhere else. This flexibility is exactly what makes inland marine insurance essential for businesses with mobile operations.
Real-World Examples of What Each Policy Covers
Let's make this concrete with some examples. Say you own a plumbing business. Your commercial property insurance covers the building where you have your office, the shelving units, desks, computers, and the inventory of pipes and fixtures sitting in your warehouse. That's all stationary property at a fixed address.
But your plumbers carry thousands of dollars worth of specialized tools to job sites every day. Those tools, your work trucks' equipment, the materials you transport to installation locations—none of that is covered by commercial property insurance once it leaves your premises. Inland marine insurance covers all of it, whether it's stolen from a job site, damaged in transit, or lost in a vehicle accident.
Construction companies are another perfect example. A general contractor might have commercial property insurance for their office and equipment yard. But the bulldozers, excavators, cranes, and other heavy machinery that move from site to site need inland marine coverage. The same goes for materials like custom cabinetry, HVAC units, or solar panels that are transported to job sites and installed over days or weeks.
Inland marine insurance also covers less obvious business needs. If you run a food truck, the mobile kitchen equipment needs inland marine coverage. Photography businesses need it for cameras and lighting gear taken to shoots. Medical practices need it for portable diagnostic equipment. Even a dry cleaner needs it to cover customers' clothing that's technically in the business's care, custody, and control.
Scheduled vs. Blanket Coverage: Which Do You Need?
When you set up inland marine insurance, you'll choose between scheduled and blanket coverage. Understanding this distinction matters because it affects both your premium and your claim payouts.
Scheduled coverage lists each valuable item individually with its declared value and often a serial number. This approach works best for high-value, unique equipment—think a $200,000 excavator, specialized medical imaging equipment, or rare musical instruments. If you're filing a claim for a scheduled item, there's no debate about its value because you've already agreed on it with your insurer.
Blanket coverage provides a single aggregate limit for a group of similar items without listing each one. This is practical for businesses with many lower-value mobile items—like a landscaping company with dozens of mowers, trimmers, and blowers. You declare a total value for all your equipment, and the policy covers items up to that aggregate limit. It's simpler to manage but requires accurate inventory tracking on your end.
Why the Risk of Going Without Is Growing
Here's something that should get your attention: cargo theft hit record highs in 2024, with losses reaching $455 million—a 26% increase from 2023. That's not just big-rig hijackings on highways. It includes theft of equipment from job sites, tools stolen from work vehicles, and materials taken from temporary storage locations.
The modern business environment makes inland marine coverage increasingly critical. More companies rely on mobile equipment, goods in transit, and third-party warehousing. Remote work means valuable company laptops and equipment are scattered across employees' homes. Supply chain complexity means your inventory might pass through multiple locations before reaching its destination.
Without inland marine coverage, you're self-insuring against all these risks. A contractor who loses $30,000 worth of tools in a truck theft pays that entire loss out of pocket. A business whose shipment is damaged in transit absorbs the full replacement cost. These aren't hypothetical scenarios—they happen to businesses every day.
How to Determine What Coverage You Actually Need
Start by making two lists. First, list all business property that stays at your fixed location—your building, permanently installed fixtures, inventory that doesn't leave the premises, office equipment. That's what commercial property insurance covers.
Second, list everything that moves—tools transported to job sites, equipment taken to clients, inventory in transit, company electronics used off-site, materials stored temporarily at project locations. That's what needs inland marine coverage. If the second list has anything on it, you have a coverage gap without inland marine insurance.
For most businesses with physical locations and mobile operations, the answer is simple: you need both policies. They're not alternatives to each other—they're complementary coverages that together protect your business property wherever it is. The good news is that inland marine policies are generally broader than standard commercial property coverage, both in terms of covered causes of loss and covered locations, giving you strong protection for mobile assets.
Getting Started with the Right Coverage
Talk to a commercial insurance agent who understands your industry. Different businesses have different inland marine needs—a landscaper's policy looks different from a medical equipment supplier's policy. An experienced agent can identify coverage gaps you might not realize exist.
Be thorough when documenting your mobile property. Take photos, record serial numbers, and keep purchase receipts. If you opt for scheduled coverage, accurate documentation makes the valuation process smooth. If you choose blanket coverage, detailed records help you prove claims and ensure you have adequate limits.
The cost of inland marine insurance is typically reasonable compared to the value it protects. Premiums vary based on your business type, the value of mobile property, and your claims history, but most businesses find it's a manageable expense—especially compared to the financial devastation of an uncovered loss. Don't wait until you're loading expensive equipment onto a truck to wonder whether you're covered. Get ahead of the risk now, and you'll have one less thing to worry about as you run your business.
