An introduction to equipment floater insurance

Lawn care and landscape businesses have unique insurance needs that are not encountered by other types of businesses. In the landscaping industry, tractors and other pieces of equipment are some of your largest assets. This equipment travels to the properties of multiple clients each day and, therefore, has a higher risk of not only theft, but other causes of loss and damage.

A typical insurance policy only covers equipment in your office building or storage facility, and a commercial auto policy may cover your trailer, but will not protect your equipment on the trailer. Equipment floater insurance is specifically designed to cover equipment and tools anywhere, whether it is at the job site or in your workshop.
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These facts are common knowledge to many landscapers, but a large percentage do not realize the insurance implications. A typical property insurance policy will only cover your equipment while it is in your office building or other place of storage. A commercial auto policy may cover damage to your trailers, but it will not protect your equipment while on the trailer. To protect this equipment with insurance, a policy needs to be written and rated to cover valuable items while away from the premises of a building.

Equipment floater insurance is specifically designed to cover your landscape equipment and tools while located anywhere in the broad coverage territory. It is a type of inland marine insurance, and that general term may be used on your policy documents. Virtually any type of mobile articles, tools, machinery and equipment (other than motor vehicles designed for highway use) can be insured under an equipment floater.

In order to allow the flexibility to meet the individual coverage needs of insured businesses, there is not a specific contract wording used by every insurance carrier in their policy documents. This is different than insurance like standardized general liability, which will have the same policy documents and unendorsed contract terms regardless of the insurance carrier. When purchasing equipment floater insurance, it is important to ask questions and understand the insurance coverages that are offered.

The good news for landscapers is that the price of equipment floater insurance is a good value, with annual premium rates ranging from 1 to 4 percent of the total value of the insured equipment. Some insurance carriers also provide discounts when this coverage is packaged into one insurance policy with general liability or commercial auto coverage. Other premium discounts may be available for safe storage techniques, theft deterrent systems, claims history and equipment maintenance procedures.

Equipment floater insurance typically has a substantially lower premium rate for scheduled equipment than the blanket coverage that applies to all other equipment. Most policies contain a schedule listing of each piece of equipment with the identification number, year, make, model and value. This is commonly used for landscaping equipment with an individual value of more than $1,000. Scheduled equipment will usually have lower deductibles and other coverage advantages in addition to the lower rate.

As the owner of a landscaping business, you certainly have many things on your mind. Take time to verify that your landscape equipment is adequately covered with equipment floater insurance, since it cannot be properly covered under other insurance. Research the coverage options to see if they fit your business needs and check the accuracy of the equipment schedule. On the declarations page of the policy, the premium will be computed with the associated rates and premium discounts. If no discounts are applied, or if other corrections need to be made, then I recommend you discuss available options with your insurance agent.

The author is an insurance agent who specializes in providing business insurance to Florida landscapers. For more information, visit www.BearWiseLandscapers.com.