What is contractor inland marine insurance?
Contractor inland marine insurance is a category of property coverage designed for tools, equipment, materials and other covered property that moves between locations or is used away from the contractor’s primary premises.
A standard commercial property policy is usually centered on property at a described location. Contractors often have valuable property in work trucks, trailers, temporary storage facilities and jobsites. Inland marine forms can help address those mobile exposures.
“Inland marine” does not refer only to boats or water. The term includes several forms of insurance used for property in transit, mobile equipment and property associated with construction or installation projects.
Types of contractor inland marine coverage
Depending on the operation, a contractor inland marine program may include:
- Contractor tools and equipment coverage
- Contractors equipment floaters
- Installation floaters
- Builders risk coverage
- Rented or leased equipment coverage
- Property in transit coverage
- Property at temporary locations
- Specialized mobile-property schedules
Each form covers a different type of property and stage of the work. One inland marine policy should not be assumed to cover every mobile property exposure.
Contractor tools and equipment
Tools and equipment coverage may protect hand tools, power tools and mobile equipment while at jobsites, in transit or at temporary locations, subject to policy terms.
Larger items may be individually scheduled using descriptions, serial numbers and values. Smaller tools may be insured under a blanket limit with a maximum amount available for any one item.
Visit the Contractor Tools and Equipment Insurance page for a detailed explanation.
Installation floater coverage
An installation floater can protect covered materials, supplies, fixtures and equipment intended to become a permanent part of a project. Depending on the policy, coverage may apply while the property is:
- In transit to the project
- At a temporary storage location
- At the jobsite awaiting installation
- Being installed
- Temporarily covered after installation
Coverage should be reviewed for when it begins, when it ends and how testing or commissioning affects the insured property.
Learn more on the Installation Floater page.
Builders risk insurance
Builders risk insurance is generally designed around a building or structure under construction, renovation or installation. Depending on the policy, it may cover the structure, materials and certain property associated with the project.
Builders risk and installation floater coverage can overlap in some situations but are not interchangeable. The proper form depends on the project, property, contract and parties responsible for arranging coverage.
Review the Builders Risk Insurance page and the Builders Risk vs. Installation Floater guide .
Property in transit
Contractors move tools, equipment and materials between suppliers, storage locations and jobsites. Inland marine coverage may address certain property while in transit, but contractors should review:
- The covered territory
- Maximum transit limits
- Whether property is owned, leased or in the contractor’s custody
- Vehicle and trailer security
- Loading and unloading provisions
- Property left inside a vehicle overnight
- Common-carrier or third-party transportation
Commercial auto physical damage generally covers the vehicle rather than every tool or material carried inside it.
Property at temporary locations and jobsites
Inland marine coverage may follow covered property to temporary locations, but the policy may contain specific limits, territory provisions and security requirements.
Underwriters may ask about:
- The largest value at any one jobsite
- How long property remains at a location
- Whether property is stored indoors or outdoors
- Fencing, lighting, locks and surveillance
- Whether the jobsite is occupied overnight
- Protection from water, weather and theft
The total inland marine limit should account for the largest realistic concentration of property that could be damaged in one event.
Rented, leased and borrowed equipment
A contractor may rent or borrow equipment for a particular project. The rental agreement can make the contractor responsible for physical damage and other charges.
If rented or leased equipment is included, review:
- The maximum covered value
- Per-item and per-occurrence limits
- The deductible
- Valuation and loss-settlement provisions
- Continuing rental charges
- Loss-of-use expenses
- Equipment rented with an operator
- Territorial limitations
Do not assume a general liability policy or certificate of insurance covers every obligation imposed by an equipment rental agreement.
Customer property and property of others
Contractors may temporarily possess materials, fixtures or equipment owned by a customer, supplier or project owner. Property of others is not automatically covered under every inland marine form.
Tell Ford Agency when your business transports, stores, installs, repairs or otherwise takes custody of property owned by someone else. The appropriate coverage depends on what the property is, who owns it and what the contract requires.
Valuation and limits
Contractor inland marine policies may use different valuation methods, including:
- Replacement cost
- Actual cash value
- Agreed or scheduled value
- Contract value for installation materials
Contractors should compare the value shown on the schedule with the policy’s actual loss-settlement provisions. A scheduled amount does not necessarily guarantee payment of that amount.
Review blanket limits, per-item limits, per-location limits, transit limits and deductibles. Coinsurance or reporting requirements may apply to certain forms.
Common limitations and exclusions
Policy forms vary, but inland marine coverage may contain limitations involving:
- Wear and tear
- Mechanical or electrical breakdown
- Rust, corrosion or deterioration
- Employee dishonesty
- Voluntary parting
- Unexplained disappearance
- Flood or surface water
- Earth movement
- Property underground or underwater
- Property left in unattended vehicles
- Testing or commissioning
- Property after the contractor’s interest ends
Some exposures may be addressed through endorsements or specialized coverage, while others may remain excluded.
How contractor inland marine differs from other policies
Inland marine works alongside—not in place of—other contractor insurance policies:
- Commercial property: generally centers on covered property at described premises.
- Commercial auto: addresses covered vehicles and vehicle-related liability rather than all cargo or tools.
- General liability: addresses covered third-party injury and damage claims rather than damage to the contractor’s own equipment.
- Builders risk: centers on a covered construction or renovation project.
- Installation floater: centers on covered materials and property awaiting or undergoing installation.
What affects inland marine pricing?
Eligibility and pricing may be influenced by:
- Types of property and equipment
- Total values and largest single item
- Maximum value at one location
- Transit and storage practices
- Jobsites and geographic territory
- Security and theft controls
- Rented or leased equipment exposure
- Valuation method
- Selected deductibles
- Prior property and theft losses
- The contractor’s trade and operations
What to send Ford Agency
Useful information for an inland marine insurance review includes:
- A detailed schedule of larger tools and equipment
- Total blanket value for smaller tools
- Maximum value at any one jobsite
- Maximum property value in transit
- Installation materials and maximum contract values
- Storage and overnight security practices
- Vehicle and trailer storage information
- Rented, leased or borrowed equipment exposure
- Customer property or property of others in your custody
- Jobsites and geographic operating territory
- Current coverage, limits and deductibles
- Recent property and equipment loss history