Plant hire insurance explained

The cover a hire company needs

Plant and machinery insurance

Covers your machines against theft, fire and accidental damage, both in the yard and out on hire. Make sure it also covers hired-in plant if you cross-hire, and that the sums insured reflect replacement cost, not what you paid at auction.

Public liability

Covers your legal liability if your business injures a member of the public or damages third-party property, for example a machine you delivered damaging a driveway. Many construction customers ask for £5 million or £10 million cover before they'll open an account.

Employers' liability

Compulsory for almost every employer in the UK, with a minimum of £5 million cover. It responds if an employee is injured or made ill at work. Fines apply if you don't have it or don't display the certificate.

Motor, trailer and goods in transit

Your delivery vehicle needs commercial motor cover for the way you use it, the trailer needs to be covered, and the plant itself needs cover while it's being transported, loaded and unloaded.

Other covers to consider

• Business interruption: lost income after a fire or major theft at the yard.
• Engineering inspection: many insurers can arrange the statutory inspections for lifting equipment.
• Contract works and professional indemnity: if you take on wider project or design responsibility.
• Cyber: if you take online bookings and card payments.
• Legal expenses: chasing unpaid hire and defending disputes.

Cover at a glance

Conditions that catch people out

Most rejected plant claims fail on policy conditions rather than cover. Ask your broker specifically about:

• Theft excess: often higher than the damage excess, sometimes £1,000 – £2,500 or more.
• Unattended plant: conditions for machines left on site overnight (immobilised, keys removed, secured).
• Trackers and immobilisers: often required above a certain value, and must be working.
• Operator restrictions: whether customers' operators must hold certain cards.
• Territorial limits: where machines can be used.
• Recovering customer damage: how your policy and your hire terms work together.
• Security at the yard: fencing, lighting, CCTV or alarm requirements.

The customer's insurance vs yours

Under the CPA Model Conditions, the hirer is normally responsible for the plant while it's on hire, and is expected to insure it. In practice, many small customers don't have hired-in plant cover, so hire firms either insist on proof of cover, offer a damage waiver for a fee, or take a deposit. Decide your approach before the first hire and write it into your terms and conditions.

What affects your premium

• Value and type of plant, and how much is lifting equipment.
• Self-drive vs operated hire.
• Your claims history and experience in the industry.
• Yard security and location.
• Trackers, immobilisers and key control.
• Turnover, number of employees and vehicles.

Working with a broker

Use a broker who specialises in plant and construction. Give them a full asset list with serial numbers and values, describe exactly how you hire (self-drive, operated, cross-hire), and ask for the conditions in writing. Review cover every time you add a machine.