Overview
Equipment floater insurance (also called an equipment floater) protects mobile construction equipment when it is away from your business premises or while in transit.
This policy fills a gap that standard property insurance typically does not cover: losses that occur on job sites, at customers' locations, or during transportation. Typical covered items include bulldozers, backhoes, loaders, forklifts, cranes, and other heavy or specialized machinery used in construction and related trades.
Key takeaways
- An Equipment Floater covers mobile construction equipment away from your business site.
- Coverage can be written on a named-peril or all-risk basis, with exclusions for wear and routine maintenance.
- You should review transit, theft, and hired-equipment exposures specifically.
- Compare policy limits, deductibles, and exclusions before buying.
How it works
An equipment floater insures covered items either on a scheduled basis (each piece listed with its value) or on an unscheduled basis (blanket coverage up to a policy limit).
Policies typically pay to repair or replace damaged equipment, or pay agreed values for total losses, subject to the policy terms, deductibles, and any coinsurance provisions.
For more discussion about why this coverage matters for contractors and construction businesses, see Why Equipment Floaters Insurance is Non-Negotiable for Your Business.
What it may cover (and what it may not)
Common coverages include physical loss or damage from fire, vandalism, theft, collision while in transit, and some weather-related events such as hail.
Typical exclusions are mechanical breakdown, gradual wear and tear, improper use, and damage from insufficient maintenance; these are often considered foreseeable and are most commonly excluded.
Optional features you may be able to add include hired or borrowed equipment coverage, rental reimbursement for replacement equipment, and transit coverage with broader protections.
For information on policies that address mobile business property and related floaters, consider reviewing Commercial Property Floater Insurance for Mobile Business Property.
Common mistakes to avoid
Assuming your standard property policy covers equipment away from your premises is a frequent error; that gap leads to uninsured losses on job sites or during transport.
Failing to schedule high-value items individually can result in underinsurance or valuation disputes after a loss.
Overlooking transit limits, sublimits for theft, or exclusions for certain uses (for example, hired labor or rented equipment) can leave you exposed at critical times.
Questions to ask an agent
What per-item limits and overall policy limits apply, and are values based on replacement cost, actual cash value, or agreed value?
Does the policy include transit coverage, and are there geographic or transportation-mode restrictions?
Are there separate deductibles for theft, transit, or on-site losses, and what documentation do you need to support a claim?
Next steps
Inventory and document your mobile equipment with photos, serial numbers, and purchase or replacement-cost records before you request quotes.
Compare proposals for named-peril versus all-risk forms, paying close attention to exclusions, sublimits, and whether scheduled or blanket coverage is recommended.
If you want help reviewing options or obtaining quotes, you can talk to an agent who understands construction equipment exposures.
Frequently Asked Questions
Does an Equipment Floater cover equipment while it is being transported?
Yes—most floaters include transit coverage, but limits and exclusions vary so confirm the terms before relying on it.
Will the policy pay for mechanical breakdown?
Mechanical breakdown and normal wear and tear are commonly excluded; separate mechanical breakdown or equipment breakdown endorsements may be required.
Should I schedule each item or buy blanket coverage?
Scheduling high-value items reduces valuation disputes, while blanket coverage can be more convenient for many smaller assets; evaluate based on your fleet and risk tolerance.
Does theft at a job site typically qualify for a claim?
Theft is often covered if the policy includes it, but recoveries depend on policy limits, deductibles, and proof of loss such as police reports and serial numbers.