Most property policies provide very limited coverage for property away from the premises or on a vehicle. This can be a problem for a contractor, who often has a large amount of property exposed to loss at job sites or en route to job sites.
An Installation Floater is the solution. An Installation Floater covers materials, machinery, equipment and property which will become a permanent part of a project. An Installation Floater can be written on its own or as part of a Package Policy that also includes Property and Commercial General Liability coverages.
The Installation Floater covers property owned by the insured contractor, but may also cover certain property owned by others that is in the contractor’s care. Perhaps a contractor is hired to build a media room in a customer’s home. The contractor will furnish and install the wall coverings, the flooring, the theater seats, and the sound system. That property is covered by the Installation Floater. The customer wants to buy his own big screen television, though, and have the contractor install it. The contractor may be responsible for damage to the television, and the Installation Floater can be written to cover that. It’s important to check the language in the policy you are considering if you are installing property owned by another.
An Installation Floater can be written to apply to a specific project. More commonly, an Installation Floater is written on an annual basis to apply to all projects. When written this way, the premium is usually based on a contractor’s annual revenue, and is adjustable at the end of the policy term.
Several different limits apply on an Installation Floater. One limit covers property at a job site. Other sub-limits may apply to property in transit and to property in storage at a temporary location. Just be careful to read the policy language if the temporary location is your warehouse or shop. Many policies don’t provide coverage at premises owned, leased or operated by the insured. Some policies also exclude the premises of your manufacturer or supplier. The insurance company may be willing to specifically name otherwise excluded locations, so it makes sense to ask the question if that’s where coverage is needed.
Lastly, when purchasing an Installation Floater, it’s important to make sure that the type of property being installed is covered by the policy. Trees and plants, for example, are often excluded property. The contractor doing landscaping installations may need to have the policy amended to specifically cover that type of property.