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Your business is your livelihood, which is why it’s so important to protect it.
It goes without saying that you’d want to safeguard your business premises with commercial building insurance and protect your van with commercial van insurance, but it’s also important to think about covering the smaller (but no less important) stuff: the essential equipment which keeps your business running.
Whether it’s everyday tech, like phones and laptops, or specialised supplies, like hairdressing equipment, the kit that you need to do your job is vulnerable to theft, fire and loss. And as a general rule of thumb: if you can’t work without it, you should probably insure it.
Read on to learn about how you can protect your business – and your livelihood – with business equipment insurance.
What is business equipment insurance?
Business equipment insurance is a form of small business insurance which looks after the day-to-day kit you need to keep your business running. It’s distinct from tool insurance – which, as the name suggests, is specifically for protecting tools: from large-scale plant equipment to powered and non-powered hand tools.
In short, business equipment insurance can protect all the moveable equipment your business relies on, with insurers offering broad policies covering everything from phones to point of sale machines.
As an example, business equipment insurance could be a good idea if you work as an architect, and you have equipment like powered measuring tools that you want to protect. The same could be true if you run a photography business and want to protect your lighting equipment. Similarly, if you run a shop or a market stall, your card machine would count as business equipment and would therefore be covered by equipment insurance.
If you work as a tradesman, then you might be better served by tradesman insurance or the aforementioned tool insurance. This is because generally speaking, business equipment is better suited to professionals or creatives.
Portable equipment insurance
If you take essential equipment with you while visiting clients or travelling away from your premises, then there’s another type of policy which could do a similar job to business equipment insurance.
Portable equipment insurance, officially known as “property away and in transit insurance”, covers all the kit that could be stolen, lost or accidentally damaged while you’re out and about.
If you’re away from your premises, and essential equipment is put out of action, portable equipment insurance could kick in to cover the cost of repairing or replacing your kit.
This kind of policy could be useful if you run a consulting business and you travel with your laptop, for example. Similarly, this cover could suit you if you run a hairdressing business and you make visits to your clients’ homes. In either case, a mishap on the road could seriously disrupt your business, and getting your equipment replaced quickly could save you from losing out.
What does business equipment insurance cover?
As with all forms of business insurance, the specifics of your equipment insurance policy will vary depending on your provider, your business situation and your level of cover.
Generally speaking, business equipment insurance will cover you in the event that moveable business equipment is stolen, lost or damaged. In any of these scenarios, your insurer should pay out to replace the supplies you need… so you can get working (and earning) again as soon as possible.
As an example, business equipment insurance could cover:
- communication equipment, like your phone, laptop or tablet
- portable machinery
- office contents
- machinery leased by your business
- equipment used in your shop or business premises, including point of sale machines
Your business equipment insurance may also extend to cover your stock, up to a certain value. However, this will depend on stock-in-trade insurance being bundled in with your equipment cover – so be sure to read the small print to make sure you understand exactly what is and isn’t covered.
What isn’t covered by business equipment insurance?
If you work as a tradesman and you want to cover your tools, then you should take out a specific tool insurance policy. And to protect specialist equipment rented by your business (as opposed to things your business owns) then you may need to take out hired-in plant cover as well.
It’s also important to understand that while business equipment insurance will cover the cost of replacing lost or damaged equipment, it will not compensate you for any of your lost revenue while your kit is out of commission. If you want to protect yourself against loss of earnings, you’ll need business interruption insurance as well.
Additionally, your business equipment insurance policy may come with exceptions. For example, in some cases your insurer may not pay out for:
- unexplained loss or disappearance
- damage resulting from wear and tear
- damage to equipment resulting directly from its own failure
- loss or damage caused by fraud
Your insurance policy could also come with certain exclusions or caveats outside of these common exceptions. We’ve said it before, and because it’s so important, we’ll say it again: make sure you read the small print and fully understand a policy before you sign on the dotted line.
How much does business equipment insurance cost?
The cost of business equipment insurance will vary from one business to the next, since the price of your policy will be linked to the value of the equipment you want to insure.
It’s on you to work out how much it would cost to repair or replace all of your equipment. This figure will be your cover limit – i.e., the maximum amount your insurer will pay out if all your covered equipment is lost, stolen or damaged. The higher your cover limit, the more you should expect to pay for business equipment insurance.
However, in the event of a disaster, business equipment insurance could save you money and get you earning again sooner. Plus, it’s hard to put a price on peace of mind – especially when small business owners have plenty to keep them up at night as it is.
If you want to cover your business equipment, and cross one thing off your list of things to worry about, then prices could start at less than £10 per month – although you should expect to pay more if you have lots of valuable kit to cover.
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Business owner insight
“Business equipment insurance is really important because without my kit, I wouldn’t be able to work. My policy includes any kit I hire as well. I’ve got cover of up to £25,000 which gives me peace of mind when I’m out on a job. I can also do one-off extras when needed depending on where I’m filming.”
Mario Genovese, Freelance Cameraman
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