A contractor's tools and equipment floater is an inland marine policy that covers your movable tools and equipment wherever they go — on the job site, in the truck, in transit, in temporary storage. The word "floater" means the coverage travels with the property instead of being tied to a building address. It matters because your other policies leave this exposure open: general liability never pays to replace your own tools, and your building property coverage largely stops protecting equipment the moment it leaves your premises — which, for a contractor, is nearly all the time. Stolen tools and damaged equipment are among the most common and work-stopping losses a contractor faces, and the floater is the coverage built for them. Cost typically runs about 1–3% of the insured value per year.
Contractors are often shocked to learn their equipment isn't covered where it actually spends its time. Two policies fail here for different reasons:
A contractor's equipment lives away from any building — on sites, in trucks, in transit between them. That's precisely the zone the property policy abandons and the floater picks up. Without it, a trailer of tools stolen overnight, a generator lost to a job-site fire, or a compressor damaged in transit comes straight out of your pocket — and, worse, can idle your crews until you replace it.
A floater is usually written in two parts, and understanding the split is what makes a claim pay cleanly:
| Coverage type | What it insures | How it's written |
|---|---|---|
| Scheduled | Larger, higher-value items — compressors, generators, trenchers, skid steers, lifts | Each item listed individually with its own insured value (typically above a $1,000–$2,500 threshold) |
| Blanket (unscheduled) | The collection of smaller hand and power tools | A single limit for the group, usually with a per-item cap |
Most contractors need both: a schedule for the big-ticket machinery whose exact value matters, and a blanket limit for the pile of drills, saws, and hand tools that would be impossible to itemize. Two mistakes are common. First, letting the schedule go stale — you buy a new skid steer and never add it, so it's uninsured when it's stolen. Second, ignoring the blanket per-item cap: a $1,500 per-item limit won't fully replace a single $4,000 specialty tool even if your overall blanket limit is high. Reviewing both the schedule and the per-item cap once a year keeps the coverage matched to what you actually own.
Tools and equipment floater premium tracks the total value you insure. The common rule of thumb is roughly 1–3% of insured value per year. Rough illustrative ranges:
| Contractor profile | Insured value | Typical annual premium range* |
|---|---|---|
| Small tradesman (truck of hand/power tools) | ~$10,000–$25,000 | ~$150–$700 |
| Established sub with mixed equipment | ~$50,000–$100,000 | ~$500–$2,500 |
| Contractor with heavy machinery | $250,000+ | $2,500–$10,000+ |
*Illustrative only — not filed rates. Actual premium depends on total insured value, type of equipment, replacement-cost vs. actual-cash-value valuation, deductible, loss history, and how equipment is secured overnight.
Two settings move both your premium and your recovery. Replacement cost vs. actual cash value: replacement cost pays to buy new equivalent equipment, while actual cash value deducts depreciation — on older tools the ACV check can be a fraction of what a replacement costs. And your deductible: a higher deductible lowers premium but means small thefts come out of pocket. For most contractors, replacement-cost valuation on scheduled equipment is worth the extra premium, because the whole point of the floater is getting your crews back to work fast.
If you rent excavators, lifts, or compactors, read this part carefully. Rental contracts almost always make you responsible for damage to the machine while it's in your possession — and a standard floater may not automatically cover that responsibility. Many policies include a modest amount for rented, leased, or borrowed equipment, or let you add it by endorsement. If renting is a regular part of how you work, confirm the floater covers your contractual responsibility for rented equipment at an adequate limit rather than assuming it's built in. This is one of the losses contractors most often discover uninsured — after a rented machine is damaged and the rental company sends the bill.
The floater is easy to confuse with two neighboring inland marine coverages, but they insure different property:
A contractor often needs more than one, and they should be coordinated so a loss doesn't fall between them. Your builder's risk and inland marine equipment coverages are companion pieces, not substitutes.
A few points separate a paid claim from a denied one. Employee theft of tools generally belongs under commercial crime, not the floater, so if inside jobs are a concern that's a separate coverage. Road-licensed vehicles are covered by commercial auto, not the floater. Wear and tear, gradual deterioration, and internal mechanical breakdown are typically excluded — the floater is for sudden, accidental loss, not maintenance. Some policies exclude mysterious disappearance, so documenting how a loss happened matters. And overnight security or storage requirements in the policy can affect a theft claim — leaving equipment unlocked in an open truck bed may reduce recovery. Knowing the valuation basis, the per-item caps, and the security conditions before a loss is what keeps the claim clean.
Bettr Coverage is an independent commercial insurance agency serving Georgia and the wider Southeast. The tools and equipment floater is the coverage contractors most often carry with a stale schedule, a per-item cap that's too low, or actual-cash-value valuation they didn't realize they had — and they find out after a theft, when they're a truck short and a crew idle. We inventory what you actually own, split it sensibly between scheduled and blanket coverage, put replacement cost where it counts, confirm rented-equipment responsibility is covered, and coordinate the floater with your builder's risk, installation, auto, and crime coverages so nothing falls through a seam. One agency, one relationship, the whole program reviewed together — so a stolen trailer of tools doesn't stop your business.
Bettr Coverage reviews your tools and equipment floater — scheduled and blanket limits, valuation basis, rented-equipment coverage — across multiple carriers, sized to what you actually own.
Get a free coverage reviewAn inland marine policy that covers your movable tools and equipment wherever they go — job site, truck, transit, storage — against theft, fire, vandalism, and accidental damage. Coverage "floats" with the property rather than sitting at one address.
GL only covers harm you cause others, never your own tools. Building property covers equipment at a fixed location and largely stops once it leaves the premises — which is where contractors' tools spend their time. The floater fills that off-site gap.
Scheduled lists larger items individually with set values; blanket insures your smaller tools as a group under one limit with a per-item cap. Most contractors need both, and the schedule needs updating as you buy equipment.
Roughly 1–3% of insured value per year, so ~$500–$1,500 for $50,000 of equipment, depending on equipment type, valuation basis, deductible, and loss history.
Often, but usually only if added. Rental contracts make you responsible for damage to the machine, so confirm the floater covers rented-equipment responsibility at an adequate limit rather than assuming it's automatic.
No. The floater covers the equipment you own; installation covers materials you're installing; builder's risk covers the structure under construction. A contractor often needs more than one, coordinated together.
For general information only. Not a quote or contract of insurance. Cost ranges are illustrative, not filed rates, and vary by total insured value, equipment type, replacement-cost vs. actual-cash-value valuation, deductible, loss history, and security. Coverage terms, exclusions, per-item caps, and rented-equipment provisions differ by policy and carrier — confirm specifics with a licensed agent. Coverage subject to policy terms and carrier appetite.