Chapter 2: Understanding Construction & Contracting Insurance Policies
Part 3.2: Essential Insurance Coverages: Inland Marine Insurance
Inland Marine Insurance can be confusing for those uninitiated with the coverage, but don't be fooled by its moniker. Though this insurance was initially created to guard goods as they crossed the high seas, today Inland Marine Insurance is used to cover all kinds of property in all kinds of transit — from physical transport to digital transfers.
Inland Marine coverage is a type of Property Insurance designed to maximize mobility. Whereas standard Property Insurance policies protect property at your primary business location, this endorsement ensures your equipment and supplies are covered anywhere they go.
Why Do I Need Inland Marine Insurance?
In a nutshell, you'll want Inland Marine coverage if you…
- Move equipment, goods, or supplies from one location to another.
- Have off-premises risk exposures.
- Own or lease mobile equipment.
- Need protection for your data (such as accounts receivable).
For contractors, Inland Marine Insurance is essential because your work takes you anywhere and everywhere. But while you're on the move or at a jobsite, your tools, equipment, and supplies could be damaged — and your primary Property policy (or Commercial Auto Insurance policy, for that matter) may not cover the loss.
For example, your hoists, ladders, and scaffolding could be damaged during transport or during setup and use. You could drop tools from a height or someone could steal them from the site. For all of these scenarios, your Inland Marine Insurance can compensate you for your loss if the item is covered by your policy.
As a general contractor, you may arrange for the lease of larger equipment (e.g., cranes or forklifts). If the rental firm determines you are the one responsible for any damage to the rented equipment, you'll need Inland Marine Insurance to protect that gear on the jobsite.
Inland Marine Insurance can protect accounts receivable, too, which could spare you from loss if the records are damaged. This is an especially useful safeguard for contractors because you may be paid in installments throughout the course of a project. Your policy may also cover valuable papers and records, such as custom project plans.
What Does Inland Marine Insurance Do?
Inland Marine Insurance can compensate you for unique damages and losses that you may face on the road or at the jobsite. For instance, your policy can offer…
- Contractor's equipment coverage. Designed just for contracting and construction businesses, this coverage compensates you for the cost of replacing lost, stolen, or damaged equipment. Some carriers only offer replacement-value coverage for equipment that is less than five years old. However, new equipment can easily be added on to your policy, and you can even include your smaller tools and equipment under your plan. If you lease or borrow equipment, you may be able to cover those, too, depending on your provider.
- Property in-transit coverage. Your Inland Marine Insurance "floats" with your covered assets, no matter if they are in transit, at the site, or in storage. So if you drop your drill from a rooftop or your supplies are damaged en route, your policy can cover the cost of their replacement.
- Mobile equipment coverage. Forklifts, dozers, loaders, cranes, and cement mixers are just a handful of the equipment your policy can cover against loss, theft, or damage. These heavy machines can be the difference between completing a project on schedule and facing serious setbacks. Fortunately, with Inland Marine Insurance, you can rest assured that your gear can be repaired or replaced quickly when something goes awry.
- Accounts receivable coverage. Inland Marine Insurance can protect accounts receivable, which can be useful if you can't afford to do credit checks. This coverage shields you against loss on receivables, such as default, bankruptcy, or slow payment. If you're unable to collect receivables due to damaged or lost records, your policy can cover that loss as well.
- Computer and media equipment coverage. As a contractor in the digital age, you likely rely on your smartphone, tablet, and computers to map out projects and keep in touch with clients. If you take these media devices on the road, you may consider giving them a little extra protection by including this coverage.
Inland Marine Insurance is a versatile type of coverage that can strengthen your underlying Property Insurance or be purchased as a standalone plan. Be sure to talk to an insureon agent for help deciding which Inland Marine policy fits your business's needs.
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