Compare business tools and equipment insurance
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If you're a tradesman, contractor, manufacturer or a small business owner in a similar industry, you’ll know how important tools and equipment can be to carrying out your work. Without these valuable items, you might not be able to run your business. So, it’s important to ask yourself: if your tools or equipment were ever lost, damaged or stolen, what would be the impact to your business’s operations?
What is tools and equipment insurance?
Strictly speaking, tools and equipment insurance is not technically a type of cover in itself, but rather, it’s an extension that can be added to your business contents insurance. Tools and equipment are not always covered as standard under contents insurance, which is why an extension is sometimes needed.
As replacing or repairing business tools and equipment may be both time consuming and expensive – not to mention that you could lose work without them – it can often be beneficial to have this cover in place, to cover you in the event of an unexpected incident.
Do I need business tools and equipment insurance?
The protection offered from this type of cover could be a beneficial inclusion to an insurance package for businesses in various industries and environments, such as:
- Pubs and restaurants
- Cafes and coffee shops
- Fish and chip shops and takeaways
- Hairdressers and beauty salons.
Essentially, if your business relies on specialist equipment or tools to carry out its work, then it’s well worth taking out protection for them.
How much does business equipment and tools insurance cost?
There’s no accurate way of giving an indicative figure for the cost of insurance for tools and equipment on this page, as prices can differ greatly depending on the extent of the cover you require. The range and nature of the items that you want to protect could vary from solely basic electrical equipment – like computers and printers – to expensive specialist apparatus – such as that used by a manufacturer – and this will ultimately dictate the price that you pay for cover.
Business equipment insurance can be shaped to protect virtually any specialist gear that your business needs to protect against threat. This could include, but is not limited to:
- Tradesman’s tools
- Kitchen appliances
- Electronic equipment
- Medical equipment
- Exercise and sporting equipment
- Music or sound equipment
- Film or photography equipment.
What can business tools insurance cover?
By including tools and equipment cover in your contents insurance policy, you can protect your items against loss, damage and theft in a number of situations. For example, consider the following circumstances:
- Loss - Your business has moved to a new location and valuable items are misplaced during the move.
- Damage - An employee drops an essential piece of kit while you’re unloading at a construction site and it is damaged beyond repair.
- Theft - Your workshop or business premises is broken into overnight and essential business apparatus is stolen.
Click the link for more information on comparing workshop insurance.
A successful claim on equipment and tools insurance could reimburse you for the cost of repairs or replacements in all of the above situations. There are also a number of other circumstances that your tools and equipment cover can protect again, depending on your business’s needs. These include:
- Breakdown – if your gadget stops working after the manufacturer’s warranty period has run out.
- Liquid damage – in case of accidental damage due to water or other liquids.
- Malicious damage - if tools or equipment have been damaged due to the malicious act of a third party.
- Worldwide or overseas cover – can provide protection while you or members of your company are abroad.
- Tools in van insurance – if a workman’s tools are left in his van overnight, for example.
Portable equipment insurance
Businesses are increasingly using portable electronic equipment for their day-to-day operations. However, portable gadgets are not typically included under tools and equipment cover as standard – they may have to be added separately. As such, if you want to help protect these expensive items against damage, breakdown and theft while you are away from your business premises, then you’ll need to add business gadget insurance to your policy.
Equipment covered under a business’s portable equipment insurance policy can include, but is not limited to:
- Laptops and notebooks
- Smart phones and mobile phones
- Digital and video camera equipment
- Scientific tools
- Survey/medical equipment
- Recording devices
- Printers and projectors
- GPS systems
- Hardware and tools
- Related accessories for the above, for instance headphones and chargers.
The cover can also include the physical items used to store or move information – such as CDs, DVDs, tapes – as well as digital storage devices, for example USB drives and portable hard drives.
As well as theft, damage and loss, portable equipment cover can also give your protection against other risks associated with your gadgets – including:
- Unauthorised calls and data usage - Can provide a refund of the cost of unauthorised calls made or data usage if your equipment is stolen.
- Data back-up - Often offered free as part of gadget insurance, this allows you to access your information if your phone is lost, stolen or destroyed.
Tools and equipment limitations and exclusions
As with all insurance policies, it’s wise to make sure you understand your tools and equipment insurance and its excess rules, limitations and exclusions. Circumstances typically not covered in a business equipment insurance policy include but are not limited to:
- General wear and tear
- Deterioration due to atmospheric conditions
- Virus or hacker activity
- Wilful negligence
- Pre-existing faults in equipment
- Damage during maintenance of equipment
- Unexplained loss or disappearance of equipment
- Loss by fraud or dishonesty of a member of the business (unless the loss is reported to the insurer within ten working days).
Other limitations and restrictions that you may come across in your policy could include:
- Age - Insurers may impose age restrictions on your gadgets, refusing coverage for gadgets more than 6 months to 18 months old.
- Time - Your policy could be invalidated if you fail to report a loss or theft within a certain amount of time after the incident has occurred.
It is also important to note that your policy may have certain conditions that you will have to adhere to, to ensure that it remains valid. For instance, many policy documents state that you are required to inform your insurance company if the quantity or value of your tools changes at any time. Failure to do so could result in your policy becoming void if ever you make a claim.
Valuating your tools and equipment
You should ensure that your tools and equipment are valued accurately before taking out insurance. If you underestimate the value of these items, and they is then stolen or damaged, you might not be entitled to receive full compensation. For example, if an integral piece of your computer equipment is valued at £900, but you have only estimated it at £500 in your policy, then your insurance might not cover the entire value of your equipment if you make a claim. This could mean that you are unable to replace your equipment immediately, or with a like-for-like replacement, which could affect your business’s ability to run at full capacity.
When calculating the value of your equipment, it is recommended that you base your figures on the replacement cost of buying the item as new, regardless of whether you originally used a discount or bought second-hand. Under-insuring your equipment can leave you vulnerable to the principle of average – if you insure only 50% of your items, your insurer may only pay 50% of the value of anything that is damaged or broken.
Overestimating your tools’ and equipment’s value is also potentially problematic, as it could mean that a claim on your policy is rejected on the grounds of submitting false information.
Get a business equipment insurance quote
If you want to add tools and equipment cover to your business contents insurance policy, get a quote Make It Cheaper today. Our panel of insurance experts can compare business tools and equipment insurance quotes from a range of insurance providers to help you get the best deal possible. Call us on 0800 144 4808 today to get your no obligation business insurance quote today.
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