What Is Plant and Equipment Insurance?

Plant and Equipment Insurance is a type of commercial insurance designed to protect machinery, equipment and other business assets against specified risks such as theft and accidental damage.

Depending on the policy, cover may be available for equipment owned by your business, plant hired from third parties and machinery used at different locations.

For contractors, specialist plant insurance may be particularly important because equipment is frequently moved between sites, transported on vehicles or stored in temporary locations.

Plant and Equipment Insurance may be arranged as a standalone policy or as part of a wider commercial insurance package, such as Contractors Combined Insurance.

What Does Plant and Business Equipment Insurance Cover?

The protection available depends on your business activities, the equipment insured and the insurer’s policy wording.

Important: Not every policy includes all these covers. Mechanical breakdown, wear and tear, unattended vehicle theft and certain types of equipment may be excluded unless specifically insured.

Owned Plant Insurance vs Hired-In Plant Insurance

There is an important distinction between insurance for machinery you own and machinery you hire from another business.

If you regularly hire machinery, it is important to review the hire agreement and understand your contractual responsibilities.

The insurance policy should be checked against the relevant hire conditions, as not every contractual liability will necessarily be insured.

What Types of Plant and Equipment Can Be Insured?

We can explore insurance for a wide range of business machinery and equipment, subject to insurer appetite and the intended use.

Some equipment, particularly road-registered vehicles, cranes, specialist lifting machinery or high-value items, may require separate or additional insurance arrangements.

Hired-In Plant Insurance

Many construction and engineering businesses hire plant and machinery rather than purchasing every item they need.

When equipment is hired, the hire agreement may make your business responsible for certain losses, damage or continuing hire charges.

Hired-In Plant Insurance can provide protection for specified liabilities arising under hire agreements, subject to the insurer’s policy terms.

Depending on the arrangement, cover may include:

• Insured accidental damage to hired machinery.
• Qualifying theft of hired plant.
• Specified continuing hire charges following an insured incident.
• Cover at temporary construction sites.
• Cover during transit, where included.

It is important to check the maximum value of any single item of hired plant, the total hire exposure and whether the policy is compatible with the contractual terms you accept.

Common Risks to Plant and Business Equipment

Plant Theft Prevention and Security Requirements

Insurers may impose security conditions for plant and equipment, particularly where machinery is stored outdoors or left unattended.

Depending on the equipment and location, appropriate risk management measures may include:

• Storing equipment in secure, locked compounds where practical.
• Using approved immobilisers and security devices where required.
• Removing keys and securing machinery when unattended.
• Using tracking devices for valuable mobile plant.
• Maintaining records of equipment serial numbers and identification details.
• Implementing appropriate site access controls.
• Checking insurance conditions for overnight storage and theft from vehicles.
• Regularly inspecting and maintaining equipment.

Security requirements vary between insurers. Failure to comply with relevant policy conditions may affect a claim.

Does Plant Insurance Cover Mechanical Breakdown?

Standard plant insurance does not necessarily cover mechanical or electrical breakdown.

Many policies are primarily designed to cover specified physical loss or damage caused by external events such as accidental damage, theft or fire.

Sudden and unforeseen mechanical or electrical breakdown may require a separate engineering or machinery breakdown insurance extension.

Gradual deterioration, wear and tear, poor maintenance and other excluded causes of failure are generally not covered.

Businesses relying on expensive or specialist machinery should carefully review whether breakdown protection is required.

Which Businesses Need Plant and Equipment Insurance?

Plant and Equipment Insurance can be relevant to a wide range of businesses.

How Much Plant and Equipment Insurance Do I Need?

It is important to ensure that your insurance limits accurately reflect the value of the machinery and equipment you wish to insure.

Depending on the policy, insurers may use replacement value, market value or another specified basis of settlement.

Important considerations include:

• The value of all owned plant and machinery.
• The maximum value of any single item.
• The maximum amount of hired-in plant in your possession at any one time.
• Whether equipment is insured on a new-for-old or indemnity basis.
• Any limits applying to tools, portable equipment or theft.
• Whether continuing hire charges and replacement hire costs are included.
• The territorial limits and locations where equipment will be used.

Inadequate insurance limits may result in a shortfall following a claim. Some policies also contain average or underinsurance provisions.

How Much Does Plant and Equipment Insurance Cost?

The premium depends on the type of equipment, its value, where it is used and the risks associated with your business.

What Information Is Needed for a Plant Insurance Quote?

To help us approach suitable insurers, we may need information including:

• Your business activities and the type of work undertaken.
• The types and values of plant and equipment requiring cover.
• Whether machinery is owned, hired-in or hired out to others.
• The maximum value of any single item.
• Where equipment is stored and used.
• Security measures, immobilisers and tracking systems.
• Whether cover is required during transit or at temporary sites.
• Any previous claims or losses.
• Any specialist equipment or contractual hire conditions.

Providing accurate information helps insurers assess the risk and offer appropriate terms.

What Does Plant and Equipment Insurance Not Cover?

Plant insurance policies contain exclusions and conditions that should be reviewed carefully.

Common restrictions may include:

• General wear and tear or gradual deterioration.
• Mechanical or electrical breakdown unless specifically covered.
• Losses arising from certain maintenance failures or existing defects.
• Theft where specified security requirements have not been met.
• Equipment used outside the policy’s permitted activities or territories.
• Consequential financial losses unless separately insured.
• Liabilities under hire contracts beyond the scope of the policy.
• Damage occurring while equipment is used in excluded circumstances.

The exact protection depends on the insurer’s policy wording, schedule and endorsements.

Why Choose Edison Ives for Plant and Equipment Insurance?

Different businesses use plant and equipment in very different ways. A construction contractor hiring excavators will have different insurance requirements from a manufacturer operating machinery within a factory.

At Edison Ives, we take time to understand your business, the equipment you use and your responsibilities for owned and hired machinery.

We can help you explore suitable insurance arrangements through appropriate commercial and specialist markets.

Our approach includes:

• Insurance options for owned and hired-in plant.
• Consideration of specialist equipment and business activities.
• Clear explanations of important policy limits and exclusions.
• Review of relevant hire agreement insurance requirements.
• A dedicated point of contact for insurance enquiries.
• Broker support during the claims process.

Speak to Our Commercial Insurance Team

Call 0113 390 4646

Email info@edinsure.co.uk