Does Your Ohio Contractor Business Need Inland Marine Insurance for Tools and Equipment?

A Middletown, Ohio contractor came in to work one morning and found his trailer and Bobcat gone. The loss: somewhere between $20,000 and $30,000. His general liability policy didn’t cover it. His commercial auto policy didn’t cover it. And his BOP? Same story. If you’re a contractor working in Northeast Ohio and you’ve never heard of inland marine insurance, this is worth five minutes of your time.

What Inland Marine Insurance Actually Is

The name throws people off. Despite the word “marine,” this coverage has nothing to do with water. The term comes from old shipping industry language, but today it means one thing for contractors: coverage for tools, equipment, and materials that move around, whether they’re in your truck, staged at a job site, or sitting in a storage yard overnight.

Standard commercial property insurance protects stuff at a fixed address, like your office or shop. Once your tools leave that address, most property policies either stop covering them or drop down to a small sublimit that won’t come close to replacing what you lost.

Inland marine fills that gap. It follows your equipment wherever it goes.

There are two common formats:

• Tools and equipment endorsement on a BOP — works well if your total tool value is under $25,000
• Contractors Equipment Floater — the right move if you’re running heavy machinery like a skid-steer, mini-excavator, or specialty rigs

What Your Other Policies Don’t Cover (And Why That Matters)

This is where most contractors get burned. Here’s how the confusion usually plays out:

• Your BOP or commercial property policy covers property at your business location. Tools at the job site? Usually not covered, or covered only up to a small sublimit.
• Your commercial auto policy covers the truck itself and liability from driving it. If someone breaks into your van overnight and takes $18,000 in tools, the auto policy won’t respond to the tool loss.
• Builder’s Risk covers the structure being built, not your means and methods. Contractor tools and equipment are explicitly excluded in most Builder’s Risk policies.
• General liability protects you from third-party claims for injury or property damage. It is not designed to cover your own equipment under any circumstances.

One scenario that comes up more than you’d think: a contractor’s tools get stolen from a rehab property, and the contractor asks the property owner to file a claim. That’s not how it works. The contractor’s inland marine policy is the right place for that claim, not the property owner’s insurance.

The Numbers Make the Case

More than 11,000 pieces of construction equipment are reported stolen every year nationally, and only about 20% of it is ever recovered. The average loss per incident runs from $6,000 to $30,000. One Concord Township, Ohio thief hit contractors for more than $43,500 in tools and materials over just three days.

Beyond the dollar figure on the stolen item, consider what else a theft costs you:

• Job delays while you wait on replacement equipment
• Operator downtime with no machine to run
• Potential premium increases or policy non-renewal
• Risk to your bonding and borrowing capacity
• Possible liquidated damages if the delay triggers contract penalties

Equipment costs have also jumped significantly. Construction equipment prices are up roughly 27% since 2020, according to Associated Builders and Contractors. If you scheduled your tools at purchase price three years ago and never updated the values, you could be sitting on a serious coverage shortfall right now. Replacement cost on a claim will not match what you have listed on your policy if your schedule is outdated.

The cost to add this protection is lower than most contractors expect. Small businesses typically pay around $29 per month for inland marine coverage. For what it protects, that’s one of the better risk-to-premium ratios in commercial insurance.

Ohio Context: Why This Matters More Right Now

Cleveland issued a record $3.11 billion in commercial construction permits in 2024. Northeast Ohio construction is on track for continued growth through 2025 and beyond, driven by industrial, logistics, and infrastructure projects. More active job sites mean more equipment in the field and more exposure to theft, damage, and loss.

Ohio’s contractor licensing requirements through the OCILB mandate general liability and workers’ comp. Inland marine is not a state requirement. That gap in mandated coverage is exactly why so many contractors find out they’re exposed only after something goes wrong.

If you operate under an OCIP or CCIP where the project owner provides Builder’s Risk, pay close attention: subcontractors are typically responsible for their own equipment under those programs. Do not assume you’re covered by the owner’s policy.

The Bottom Line

• Check your current policies now, before a loss happens. Pull out your BOP and ask your agent what the off-premises sublimit is for tools and equipment. If it’s blank or low, you have a gap.
• Get your equipment values updated. With prices up 27% or more since 2020, a schedule from a few years ago is likely underinsured. An outdated value means an underpaid claim.
• Match the coverage type to your operation. Light tool users can often add an endorsement to their BOP. Contractors running excavators, lifts, or specialty machinery need a standalone Contractors Equipment Floater.

If you’re a roofer, HVAC tech, plumber, electrician, or general contractor working in Northeast Ohio and you’re not sure whether your tools are actually covered, reach out to UPIC Commercial for a straight answer. You can request a quote at upiccommercial.com/quote or call Andrew directly at (216) 714-3377. It’s a quick conversation that can save you a very expensive lesson.