Keeping your tools covered
If you own your own business, chances are, regardless of what type of business you’re running, you will have some form of tools or equipment that are portable — that is, they don’t always reside at your place of business, but instead tend to come with you wherever you go.
If you have contents insurance for your home (if you run your business from home) or place of business, it’s possible, but not always guaranteed, that you may have some cover for your portable business tools and equipment. However, the level of coverage will vary from policy to policy and may not be enough to cover the extent of the value of your tools and equipment — and it’s also possible that your policy may not cover your tools and equipment when they are in transit and aren’t at your place of business.
Your best bet when it comes to coverage of your work-related tools and equipment is a business-related insurance, which, depending on the insurer, may be referred to as tools of the trade insurance, tradesman insurance, property and tool insurance, or general property insurance. For the purpose of this article — which is to include information for small businesses that are trade-focused as well as those that are not — we will stick with the latter term.
What is general property insurance?
General property insurance is really straightforward, which is always wonderful when it comes to the often-complicated world of insurance. Essentially, general property insurance is designed specifically for businesses to protect against the loss or damage of insured property — which, in this case, is usually tools of the trade and equipment.
The idea of general property insurance is that your work-related equipment is covered both when it’s on the work premises, as well as when it is away from the premises.
This type of insurance can usually be purchased as a stand-alone policy or as part of a business pack insurance policy.
What does it cover?
General property insurance is designed to cover tools of the trade and portable electronic items (so laptops and phones, etc.) that you choose to list on your policy. Some policies will even cover stock in trade.
The policy will typically cover any accidental damage, as well as theft as a result of violent or forcible entry (i.e. if you leave your tools and equipment in an unlocked car and they end up disappearing, you’re not covered).
These types of policies usually provide either a specific blanket monetary amount of coverage for all or selected types of tools and equipment, or coverage of a nominated value for individual items — or a mixture of both, depending on your needs. However, policies will vary between insurers.
How do I know if I need it?
As always, the best way to determine what is most appropriate for you and your business is to speak with a trusted business or insurance adviser. If you’re going with the latter, make sure you speak to someone who isn’t affiliated with a particular insurance company.
These types of professionals will be able to assess the specifics of your business and situation and then make an informed recommendation about what insurance policy is best for you. They may determine that contents insurance will suffice in your situation, or they may recommend that you go with a general property insurance policy.
They may also be able to make recommendations on which insurance company is best suited to your needs. For example, some insurers specialise in policies designed for specific trades.
Don’t be afraid to ask lots of questions — having clarity on the ins and outs of insurance related to your business will only enhance your ability to make the kinds of decisions that can help make your business a success.