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What is tool insurance?

Tool insurance could cover the cost of replacing your tools if they end up lost or damaged as a result of fire, flood or theft.

You might want to cover things like handheld tools, power and non-power tools and plant equipment. This includes tools you own or have loaned, leased or hire-purchased.

Specialist tools can be expensive. If you lose yours and have to wait until you can afford to replace them, you could end up losing valuable customers. With tool insurance in place, you can quickly replace your tools and carry on working with minimal disruption to your business.

You can buy tradesman tool insurance as part of a business insurance package, alongside other cover like public liability insurance. When you compare with us, you can add traders tool insurance to your quote, which covers:

• Handheld tools

• Portable power tools

• Tools at your business premises, in your vehicle or on site

• Tools left in a vehicle overnight.

Why is tools insurance cover important?

Your tools are crucial for your trade, especially if you’re self-employed. It's not just the cost of replacing them, but it’s the potential business you lose from not being able to work as planned. The right business and tool insurance can protect you against these costs and provide peace of mind.

How does tool cover insurance work?

Tool insurance can be an add-on to your general business insurance. The main factor to consider is how much protection you want – cover can range from around £1,000 to £20,000.

The first thing to do is list all the tools you own – there are likely to be more than you think. Now consider how much those tools are worth; that’s how much cover you’ll need. It’s easy to underestimate this but think about how much it would cost you to replace them – not how much you paid for them.

What does tool insurance cover?

Every tool insurance policy is different, but insurance for work tools can provide:

• Personal tools insurance — cover tools at home, as well as in the workplace.

• Tools in transit insurance — that means your tools are protected when you’re out on the road.

• Hired-in plant cover — cover for specialist tools you rent.

• Toolbox insurance — you can insure your whole toolbox, including the box itself, or get tool only insurance.

• Theft cover — covers tool theft from your van or locked away on site.

• Damage cover — protects against water and fire damage.

• Loss cover — covers loss of tools while working away on site.

• 24/7 cover — this means your tools are protected overnight.

• EU cover — useful if you travel to Europe for work.

Always read the policy wording before you buy, so you know exactly what you’re covered for.

What doesn’t tool insurance cover?

There’s a few things that tool insurance won’t cover. These include:

• Wear and tear. If your tools wear out or break.

• Deliberate damage. If you, or one of your colleagues, deliberately damage your tools.

• Manufacturing faults. These should be covered by the warranty.

What else should I consider when taking out tool insurance?

Before you take out a separate policy, check to see if you’re already covered on your existing insurance. Your tools may already be included in your business or home insurance, for example. If you use a van for work, check if your policy includes van tools insurance. If you work from home, let your insurance provider know. They may be able to extend your home contents insurance to cover work-related tools.

Check the excess. Paying a higher voluntary excess (the amount you pay towards any claim you make on your insurance) could help reduce the cost of your premium. But this doesn’t make sense if the excess is more than it would cost to replace the lost or stolen tool.

Watch out for exclusions. You may find that your policy comes with certain conditions attached: for example, that you have to keep your tools under lock and key. Also check whether your policy includes tool insurance for employees to find out if they are covered, and any cover limits per person.

How much does tool cover insurance cost?

How much tool insurance costs your business may depend on:

• The number of tools you’re insuring

• The type of tools you’re insuring — large power tools will be more valuable than hammers, saws, pliers and screwdrivers

• The level of cover — adding 24/7 cover, EU cover etc. will likely make it more expensive.

• The excess you choose — the excess is the amount you’re willing to pay towards a claim. The higher the excess, the cheaper your premiums tend to be.

Top tips for keeping your tools safe

Thefts of tools worth thousands of pounds from building sites and vans aren’t uncommon. So it’s more important than ever to keep your tools safe.

As well as helping to protect your tools, these tips could also reduce the cost of your equipment insurance premium:

• Don’t leave tools in your van overnight.

• If you must leave your tools in a van, make sure the vehicle is alarmed and the tools are out of sight.

• Keep your van parked securely overnight. If possible, park against a wall.

• Install security systems, such as CCTV, wherever you keep your tools. Consider smart security systems you can control from your phone.

• Mark your tools with an address and phone number in invisible ink. This will increase your chances of getting them back if they’re stolen.

• Register your tools’ serial numbers in an online database.

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