Business equipment insurance

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Page written by Chris Godfrey. Last reviewed on September 21, 2024. Next review due April 6, 2025.

What is business equipment insurance?

Business equipment insurance protects you from financial loss in the event that the vital tools and equipment you use to carry out your trade or business are lost, damaged, or stolen. Suitable for companies, partnerships, sole traders, and the self-employed, business equipment insurance can protect portable tools, office equipment and contents, laptops, mobile phones, and machinery that is owned or leased by you or your business partners.

Business equipment insurance comes in three main categories:

Business equipment cover

Protects the essential equipment you need to keep your business running. For example:

Office desks and chairs
Computer and communications equipment
Hair stylist and beauty salon tools and equipment
Shop shelving systems and display cabinets
Point of sale equipment, such as tills, card readers, and bar code readers

Owned plant, equipment and tools insurance

Designed for tradespeople, this protects the specialist tools and equipment you own and use in your business. For example:

Trailers
Cement mixers
Portable tools – saws, drills, step ladders, etc
Site huts
Light and heavy machinery, such as a lathe, table saw, crane or bulldozer

This cover may also provide limited protection for loss of stock in trade, such as piping, flooring, electrical equipment and timber that you have purchased but not yet used to complete a project.

Hired-in plant cover

Hired-in plant insurance protects equipment that you may have hired and that is not covered by the lessor’s insurance. For example:

Rented caravans
Rented site huts and cabins
Light and heavy machinery, such as diggers and scrapers

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Who needs business equipment insurance?

No matter if it’s a hammer, camera, computer, power-wash, trolley-jack, or even a tattooist’s kit, every business needs tools and equipment to deliver the goods and services they sell. Think about it. What would you do if suddenly, all your essential equipment went up in smoke? Could you afford to buy replacements immediately? Could you even stay in business? For most SMEs, losing the tools of their trade would be catastrophic – and that’s why every UK business needs equipment insurance to prevent disaster if the worst should ever happen.

What does Insurance for business equipment cover?

Business equipment insurance pays for the replacement of essential tools, equipment and machinery in the event they are stolen, damaged, or lost, up to the maximum value of your policy.

Covered events include:

Fire

Covers damage, destruction and loss caused by fire.

Example: A fire in your tanning salon destroys the sun-beds that your customers use.

Theft

Covers loss should your business equipment be stolen, including theft by employees or contractors.

Example: Someone breaks into your garage and steals your expensive diagnostic equipment.

Flood

Covers damage, destruction and loss caused by flood.

Example: Burst water pipes flood your photography studio, destroying cameras, lights and accessories.

Loss

Protects you should you lose items of equipment.

For example: You leave your laptop on the train, and it is never handed in or returned.

Accidental damage

Covers against accidental damage or destruction of equipment.

Example: You spill a drink on the photo-copier, causing the electronics to burn out.

Why is equipment insurance important?

No business can entirely eliminate the chance of their important equipment being lost, stolen, or damaged. If things do go wrong, the financial impact your equipment loss could be a lot higher than the cost of repairs or replacement:

You may lose days or weeks of revenue while you try to repair or replace the lost or broken equipment.
If you’re not trading, your customers may look elsewhere. Some may never come back.
You could miss important deadlines that cost you future work or result in financial penalties.
You may not be able to earn enough to keep your best employees.
Financial stress could impact your ability to secure loans or pay your taxes on time.

Equipment insurance is designed to quickly cover the cost of repairs or replacement to lost or damaged equipment, allowing your business to get back to normal as fast as possible and minimize any disruption.

In a nutshell, equipment insurance is important because it could be the difference between survival or closure of your business, and the losses that you may incur by not having business equipment cover could far outweigh the cost of any policy.

How much does business equipment insurance cost?

Some policies can cost as little as £4 per month, but premiums will vary depending on your business type, the industry you work in, the value of your equipment, and the excess you agree to pay.

Other equipment insurance points to keep in mind:

All insurance policies come with an ‘excess’ – this is the sum you agree to pay as part of any claim. Generally, the higher the excess you agree to, the lower your policy cost will be. However, make sure you do no not set an excess amount that is higher than the value of the equipment you are insuring. Also be aware that some policies may have exclusions, such as mobile phones or laptops, so always check the fine print to ensure you receive the cover you want. Lastly, always keep copies of the receipts from any equipment purchases and take photographs of the items that you want insured. This can speed up the process should you need to make a claim.

How Swoop can help

All business involves risk, but that doesn’t mean you have to suffer the consequences if things go wrong. Don’t gamble with your organisation’s future. Contact Swoop today to compare top-quality equipment cover from different providers and to discuss all your business insurance needs.

Written by

Chris Godfrey

Chris is a freelance copywriter and content creator. He has been active in the marketing, advertising, and publishing industries for more than twenty-five years. Writing for Barclays Bank, Metro Bank, Wells Fargo, ABN Amro, Quidco, Legal and General, Inshur Zego, AIG, Met Life, State Farm, Direct Line, insurers and pension funds, his words have appeared online and in print to inform, entertain and explain the complex world of consumer and business finance and insurance.

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