Whether you rent out video equipment, party supplies, or gardening tools, your business has a pretty big investment on its hands. Just think of all the property you own to rent to others.
And an investment like that, combined with the liability risks involved with whatever the heck your customers do with your equipment while renting, makes having the right insurance in place a must.
Fortunately, our independent insurance agents are here to eliminate the hassle of searching on your own by walking you through a hand-picked selection of top insurance policies to cover both your business and your employees. But first, let’s talk more about the protection you need and why you need it.
Insurance Coverage for Equipment Rental Businesses
If you run an equipment rental or party rental business, you may be wondering how to know that you and your equipment are covered against the risks you face. What if someone’s injured while using your equipment? What if your equipment is damaged? Who pays?
For starters, you’ll need several basic business insurance policies, like:
- General liability: Provides coverage if you or your staff members are responsible for bodily injury or property damage to others.
- Property insurance:
- Covers your real property if you own your building
- Covers your building contents, other than rental items
- Covers your rental items
- Commercial vehicle: Your policy will need to include auto liability to cover both bodily injury and property damage for you and all employees who drive on the job.
- Workers compensation: Depending on the laws in your state, you may need this coverage; it provides financial compensation to your employees due to work-related injuries or illnesses.
You will need several additional types of coverage to manage your risks as an equipment rental company. An independent insurance agent in our network can help assess your risks and provide a complete rentals insurance package.
Rental Equipment Coverage for Businesses
You have risks regarding your rental equipment in two areas:
- The equipment can be lost or damaged while in your possession or the customer’s.
- The equipment can cause bodily injury or property damage
To adequately protect your tools, machinery, and other rental items, be sure to work with a knowledgeable agent who can put together a complete equipment rental insurance package for you, which may include:
- Inland marine coverage: An inland marine policy or "floater" policy will cover your equipment on, or off, your business premises, regardless of who’s handling it. Inland marine policies normally provide broad protection on covered items, and you’ll have to pay a deductible on each loss.
- General liability: Your general liability policy, if properly written, will protect you for any bodily injury or property damage that comes from your operations, including rental items in the hands of a customer.
- Rental agreement: For this agreement, you’ll need to work with your attorney. Your attorney will draft a rental agreement that clearly states responsibility for the loss or damage of any rental items and liability claims related to their use.
Note that no matter how much responsibility the agreement transfers to the renting customer, you need to be fully insured yourself. For example, what if the customer doesn’t have the skills or know-how to use the equipment properly.
Or what if the customer lends the equipment to a friend or neighbor to use before it’s returned. If anyone is injured under these circumstances, you could be in a position where you need to defend yourself in court.
In any given case, the customer may not be willing or able to meet the agreement’s contractual obligations. Or, in a worst-case scenario, the customer may leave with your property and never return.
Important Rental Business Insurance Considerations
The rental agreement your customer signs should assign responsibility to the customer for loss or damage of the rental items, and for any bodily injury or property damage liability coming from the use of the rental item. However, when renting certain equipment, you have some responsibility as the equipment rental business.
Here are some important considerations:
- If you rent a construction crane to someone who has no idea how to use it, you could still be found responsible if the customer causes an accident of some kind. While your insurance may protect you, the insurance company may not continue your coverage going forward.
- Some equipment should only be rented with operators. Some equipment will require training before being released to the customer.
- You should have a clear understanding with your insurance carrier about any rules or restrictions concerning the rental of potentially dangerous or hazardous equipment.
- If you’re renting high-value equipment, or renting equipment for a long period of time, you may want to insist that the customer purchase a policy on the equipment and/or a liability policy to cover its use. You can ask that you be an additional named insured on that policy. If you do have a requirement like that, you should get a certificate of insurance as evidence that the requirement has been met. This will provide you with the best protection against having to make a claim on your own policy.
Your rental business insurance policy is an asset of your business, and probably the most valuable, at that. Protect it by using common sense in regard to what you rent and to whom.
Finding and Comparing Rental Business Insurance Quotes
Our agents will review your needs and help you evaluate which rental business insurance coverages makes the most sense. They'll also compare policies and quotes from multiple insurance companies to make sure you have the best protection out there. They'll hook you up — in a comprehensive and affordable way.
What's So Great About Independent Insurance Agents?
Independent insurance agents excel at matching the most appropriate policy to the business in need. Shopping around for insurance policies can be tricky, confusing, and time-consuming, and an independent insurance agent's role is to simplify the process.
They’re also there to help make sure you get the absolute best deal, and the one that meets your unique needs. They shop and compare insurance quotes for you, and they'll break down all the jargon so that you understand exactly what you're getting.