Keep tools locked up inside your home or garage overnight if possible
Tool insurance, also known as tool cover, is insurance to protect the tools of your trade. If you’re a tradesman, you rely on your tools to get the job done – and chances are you’ve invested a lot of money in making sure you have the right kit.
Tool insurance helps keep that investment safe. If your tools are lost or damaged, it’ll pay out to help you replace them.
Tool insurance policies come with overnight cover – meaning your tools are protected 24/7, whether they’re at home, at your business address, or in your locked van. This also includes tools in transit, so you’ll stay protected wherever you go.
If you're a tradesperson who works with tools every day, chances are you'll have your own set of expensive tools and equipment. Think about how much it would cost if you had to suddenly replace all of these tools in the event of fire or theft incident. That's why it's crucial to have the right protection in place, especially since tool theft is on the rise.
It's not just the cost of replacing tools, either. Consider how much potential business you could lose if something happened, plus the time and effort it would take to purchase everything again.
The right insurance can help cover the costs of replacing your tools and get you up and running again with minimal disruption to your business.
Theft and/or loss
Your tools will be covered for up to £10,000 if they get stolen or lost
Tools kept in a van
Tools left in your van overnight or in transit are covered
Natural disasters like fire, flooding, or storms
Your tools will be covered for any damage caused by natural disasters
Deliberate vandalism or burglary
Tools damaged or destroyed by criminal activity can be replaced or repaired
You are protected for any accidental damage as long as it isn't considered negligence
Hired in-plant cover
Tools or machinery that you buy on hire-purchase can also be protected
In addition to the tools inside, you can also get cover for the toolbox itself
European Union cover
Your policy can also provide cover for your tools if you are required to travel to Europe
Wear and tear
Any standard wear and tear that happens naturally to your tools over time isn't included in your policy
You're not covered if you or your staff cause any intentional damage to your tools
If there's a fault with any of your tools or equipment, this should be covered by the warranty, not your insurance
If your van is left unattended for more than 48 hours, your tools won't be covered by your tools insurance policy
Tool insurance works by protecting the tools you use up to a certain amount. If your tools would cost £5,000 to replace, you can take out £5,000 of insurance.
When choosing tool insurance, here's what to consider:
How much cover you need – This depends on how much you’ve invested in your tools, and how much of a risk you face if something going wrong
What's covered and what isn't – Some policies might not cover tools overnight or in transit. Others might only cover your own tools, and not those you’ve rented. So, it's important to double-check your policy documents
No fees – You shouldn't be charged any fees to make changes to your policy, even if you need to cancel. Policies are made straightforward with a flat excess of £200 for all claims
The value of your tools and how many you want your policy to cover will directly affect the cost
By increasing your voluntary excess, you can reduce the cost of your insurance while choosing not to pay an excess will make insurance more expensive
Your insurance will be cheaper if you store your tools in a safe place when you're not using them
Your occupation and the type of work you do can affect the risk of your tools being damaged, lost, or stolen, and so will affect your insurance premiums
Shop around and compare different levels of tool cover to find an affordable option for your business
The higher the excess you choose to pay, the lower your premiums will be. Just make sure you can afford it, in case you need to make a claim
Over-insuring your tools will cost you more, so double check the real value of them in order to get the appropriate level of cover
Your tools may already be covered by your home or business insurance. If not, it may be cheaper to extend one of these policies to cover tools
Theft of tools can be a huge problem for sole traders, so tool insurance can be a really good way to lessen the financial impact if you should get unlucky. Carefully work out the value of your tools, as that will determine the level of cover you buy. Overestimate the value, and you could end up paying too much for your premium but underestimate and you could be left with a shortfall if you make a claim."
If your business relies on your tools, it’s worth thinking about taking out a tool insurance policy. Try to add up the value of all the tools you own – consider how much it would cost to replace them, not how much you paid for them originally. If it would be difficult for you to replace your tools, tool insurance might be the smart choice.
You can usually insure any tools up to £10,000. That includes handheld tools, power tools, and plant equipment. Some insurers might exclude some specialised tools, so it’s worth checking your policy document carefully.
If you have van insurance, there’s a chance your tools are already covered while they’re in your vehicle.
If not, look for a tool insurance policy with overnight cover and tools in transit cover – this means that they’re always protected, even when they’re in your van or on the move.
Tools are also covered if they are stored in a car too.
Some types of business insurance, such as business contents insurance or public liability insurance, will let you include tool insurance as an add-on. It can be more convenient and save you money, so check your existing policy.
Tools in transit insurance covers your tools while they’re being driven around, loaded, or unloaded.
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