Hired-in plant insurance

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    Chris Godfrey

    Page written by Chris Godfrey. Last reviewed on April 24, 2024. Next review due April 6, 2025.

    Big machines usually come with big price tags, and the cost of replacing or repairing lost or damaged rented construction equipment could be beyond many businesses, forcing them into bankruptcy. Fortunately, hired-in plant insurance is here to do the heavy lifting. Use it to protect the plant you hire. Eliminate the risk of a major financial malfunction.

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      What is hired-in plant insurance?

      Hired-in plant insurance, also known as plant machinery insurance, or more simply, plant insurance, is a type of business insurance that provides financial protection against the loss or damage of construction plant and equipment that you may have temporarily rented under contract. This includes cranes, diggers, cement mixers, dumpers, generators, forklifts, etc. 

      Because this type of equipment can be very costly to buy, but it is not always be needed, tradespeople often prefer to hire the plant rather than purchase it. However, the fact that you’re renting the equipment rather than buying it does not let you off the hook should the machinery be stolen, or lost to fire, flood, severe weather or accidental damage. You will still be responsible for any loss. However, hired-in plant insurance can cover all these risks, protecting you from the significant compensation costs you may be liable for under the terms of your hire agreement. 

      Do I need hired-in plant insurance?

      Construction plant is not cheap. Could your business afford to pay for the replacement of one or more pieces of heavy equipment, plus the legal expenses that would inevitably accompany any claim? These costs could easily run into the tens or even hundreds of thousands of pounds. If your company hires plant machinery, even if it’s only for short periods, you need hired-in plant insurance to protect you from the risk of compensation claims that could badly damage or even close your business down. 

      What does hired-in plant insurance cover?

      Hired-in plant insurance will pay for the repair or replacement of constructional machinery that you’ve rented under the contract should it be lost or damaged due to:

      Theft and vandalism

      Millions of pounds worth of plant and machinery is either vandalised or stolen from UK construction sites every year. Your rental agreement will usually stipulate that you are responsible for any loss or damage to the equipment and that insurance of the plant is your responsibility. (Some rental companies may not let you take the equipment if you do not have insurance protection). 

      Fire, flood, severe weather and accidental damage

      Construction sites are hazardous places and equipment is often left outdoors and exposed to the elements. Fires, floods, lightning strikes and accidental damage to plant can occur at any time. Hired-in plant insurance protects you from the risk of natural disasters and workforce errors. 

      Hired-in plant insurance may also come as part of a tradesman insurance policy, which usually includes:

      Public liability insurance

      Public liability insurance protects your business if someone is injured, or their property is damaged because of the services that you or your business provides. This type of cover, also known as PL or liability insurance, is designed to protect your business against third party claims for injuries or property damage from a customer or client, passer-by, or a visitor to your business premises – including building sites – whether you’re at fault or not.

      Employers’ liability insurance

      Employers’ Liability (EL) Insurance is a legal requirement for most UK employers. EL protects you and your employees, (including those who no longer work for you), should they be injured or become unwell as a result of working for your business. EL typically covers the associated legal and compensation costs, and other damages of such events, but it can also cover accidental injury or damages caused by an employee to a third party, like your customers.

      How much does hired-in plant insurance cost?

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

      What other types of insurance can protect my business?

      You need sufficient commercial property insurance to restore your buildings and contents to the state they were in before the damage or loss occurred. This means you should request a policy limit – the maximum sum that the insurer will pay out – to cover the cost of the worst-case scenario: Meaning the demolition and rebuilding of the property and replacing everything inside. If you are not sure what this value would be, you could employ a professional valuer to provide an estimate of total replacement cost.

      Top tip: Don’t forget the hidden expenses incurred in any rebuild, it isn’t only demolition and construction costs you will face. Surveyors, legal and other professional fees, plus permits and local council inspection costs must be factored in.

      When should I get commercial property insurance?

      You should obtain commercial property insurance as soon as you exchange purchase contracts on the property. Unseen events that damage or destroy the property can occur at any time, so it is recommended that you get cover immediately and do not wait until you physically occupy the building or start trading from the premises.

      Top tip: If you do not intend to occupy the building within 30 days of taking out your insurance, you must tell your insurer.

      What other business insurance do I need?

      There are business insurance policies to cover every type of risk:

      Tools insurance

      Tools Insurance, also known as portable equipment cover, or business equipment insurance, covers the cost of replacing business tools and equipment if they’re lost, damaged, or stolen. Items that are typically covered include:

      • Handheld tools (hammers, screwdrivers, saws, pliers)
      • Power tools (drills, sanders, angle grinders, nail guns)
      • Plant equipment (excavators, rollers, diggers, dump trucks)
      • Owned, loaned, leased or hire-purchased/leased tools

      Occupational personal accident insurance

      Occupational personal accident insurance covers anyone named on the policy for accidental injury or death at or outside of work. This includes loss of income, medical costs and hospitalisation benefits.

      Owned plant insurance

      Designed for tradespeople, owned plant insurance protects the specialist 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.

      Contract works insurance

      Suitable for builders and other tradespeople, contract works insurance covers the work you are hired to do on a construction site. If your work is affected by a flood, fire, theft or malicious damage, contract works insurance can protect you from loss of income or the cost of work-related penalties.

      Goods in transit insurance

      Goods in transit insurance covers goods or raw materials against loss or damage whilst in transit from one place to another. This can include goods transported in your own vehicle, or on your behalf by a third-party carrier. 

      Professional indemnity insurance

      Professional indemnity insurance, also known as professional liability insurance, is an essential type of cover for individuals or businesses that advise clients, help them navigate complex financial or legal affairs, or provide them with vital information that is published in the media. In these kind of cases, errors can cost thousands or even millions in legal compensation claims. Professional indemnity (PI) can protect you if a client makes a financial loss because of your work and then makes claim against you or your business. Trade associations, government bodies, public institutions, and major customers will often require proof of a minimum level of PI insurance before doing business with you.

      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 let the loss of plant machinery throw a spanner in the works. Contact Swoop today to compare top-quality hired-in plant insurance 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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