Plant & equipment insurance
Plant, machinery and equipment can represent some of a business's largest movable assets, and replacing them quickly after a loss can be difficult. RMA Insurance Brokers helps owners, contractors and hire operators review plant and equipment insurance around ownership, use, hire arrangements and movement between sites.
Plant and equipment insurance at a glance
Plant and equipment insurance is designed to cover mobile plant, machinery, equipment and tools against accidental damage, theft, fire and other insured events. Depending on the policy, cover may apply to owned, hired-in or hired-out items, and may include items while in transit between sites or at a worksite.
The right structure depends on who owns the plant, how it is used, where it travels and the contractual obligations that come with hiring or leasing arrangements. Limits, exclusions and settlement bases vary between insurers.
Key areas
- Owned plant, machinery & equipment
- Hired-in & leased plant
- Hired-out plant
- In transit & between sites
- Tools & portable equipment
- Mechanical & electrical breakdown considerations
Who should consider plant and equipment insurance?
Plant and equipment insurance is worth considering for any business or individual that owns, hires, leases or operates mobile plant or specialised equipment.
- Earthmoving and civil construction contractors
- Builders, tradespeople and subcontractors
- Crane, access and equipment-hire businesses
- Farmers and rural operators with self-propelled plant
- Businesses that hire plant or equipment to others
- Landscaping, demolition and quarry operators
A review is particularly useful where you:
- own or operate high-value mobile plant or machinery
- regularly hire plant in or hire plant out to others
- move equipment between worksites, depots or customer locations
- have contractual insurance obligations under hire or lease agreements
- rely on specific items to keep revenue coming in
- have experienced theft, damage or a disputed claim in the past
What can plant and equipment insurance cover?
Owned plant, machinery & equipment
Cover may respond to accidental damage, theft, fire and other insured events affecting mobile plant, machinery, equipment and tools owned by the business or operator, subject to the policy wording, limits and exclusions.
The basis of cover can vary between insurers and may be influenced by the age, value, type and use of each item.
Hired-in & leased plant
Hired-in or leased plant can create contractual obligations to insure or indemnify the owner. A hired-in plant extension may cover loss or damage to plant the business does not own but is responsible for under a hire or lease agreement.
The hire agreement should be reviewed for damage obligations, continuing hire charges, recovery costs and indemnities, as not every contractual amount assumed under a hire agreement is automatically insured.
Hired-out plant
Businesses that hire plant or equipment to others should review how cover applies while the equipment is on hire. The arrangement can differ between dry hire, where the hirer operates the plant, and wet hire, where the owner also supplies the operator.
Hire conditions, operator requirements, theft or conversion exposures, transit arrangements and contractual indemnities should all be considered when cover is arranged.
In transit & between sites
Plant and equipment often travels between worksites, depots and customer locations. Some policies include transit cover for the insured items, while others require a separate transit or cargo arrangement, particularly for longer distances or oversized loads.
Loading, unloading and towing arrangements can also affect whether cover applies.
Tools & portable equipment
Hand tools, power tools and portable equipment may be covered under a plant and equipment policy or a general property section, depending on the insurer. Items left in vehicles, on sites or in public areas may be subject to security conditions or sub-limits.
Declared values, storage practices and proof of ownership can all influence how a claim is settled.
Mechanical & electrical breakdown considerations
Plant and equipment policies are generally focused on insured physical loss or damage. Mechanical or electrical breakdown may be excluded, restricted or available through an additional benefit or separate policy, depending on the insurer.
Where breakdown is a significant exposure, dedicated equipment breakdown cover may need to be considered. Business interruption or substitute-hire costs following breakdown should also be checked separately rather than assumed.
How a plant and equipment policy is put together
Plant and equipment insurance is generally arranged around what is owned, what is hired in or out, how the plant is used and the contracts that sit behind each arrangement.
Areas commonly reviewed include:
- ownership details and insurable interest for each item
- the applicable settlement basis, including market value, agreed value, sum insured and any new-for-old provisions where available
- hired-in plant obligations and indemnity requirements
- transit, towing and movement between sites
- operator licensing, experience and any restrictions
- storage security, site conditions and unattended item exposures
- road risk and public liability arrangements where plant is driven, moved or operated around third parties
Insurance for physical loss or damage to plant should also be distinguished from liability exposures arising while plant is being operated. Public liability and, for relevant registered mobile plant, compulsory statutory injury arrangements may need to be considered separately.
When should plant and equipment insurance be reviewed?
Plant and equipment insurance should reflect the items you own, hire and operate today.
A review is particularly worthwhile when you:
- list every item, including serial numbers, year, make and model where available
- confirm whether items are owned, hired-in, hired-out or borrowed
- check hire agreements for insurance and indemnity clauses
- agree values and basis of settlement with the insurer
- understand exclusions for unattended items, wear and tear and mechanical failure
- confirm transit cover and any towing or oversized-load requirements
- review operator restrictions, licensing and training requirements
What may not be covered?
Every policy has exclusions and conditions that affect whether cover responds. The following are commonly excluded or restricted under plant and equipment insurance.
- Wear and tear, gradual deterioration and maintenance-related failure
- Mechanical or electrical breakdown unless a specific breakdown extension applies
- Theft of unattended items where security conditions are not met
- Use by operators who do not meet applicable licence, competency or policy requirements, where cover is excluded or restricted
- Damage during illegal, reckless or prohibited use
- Items used outside the declared territory or for unapproved activities
- Contractual obligations or indemnities assumed under hire agreements beyond what the policy covers
This is not a complete list. The relevant policy wording, schedule, endorsements and circumstances of the loss determine how the insurance responds.
Example: when plant is damaged during loading
Illustrative example
An excavator is damaged while being loaded onto a trailer at a regional worksite.
The broker confirms whether the policy covers transit, loading and the specific item, and whether the trailer or towing arrangement is also insured.
The claim is lodged with the insurer, repair quotes are obtained and RMA Insurance Brokers assists with insurer communications about the damage, settlement basis and any applicable benefits such as substitute hire or continuing hire costs where these have been included in the policy.
This example is illustrative only and does not mean cover will respond in the same way for every claim. Outcomes depend on the policy wording, circumstances and insurer assessment.
Plant and equipment cover in regional Australia
RMA Insurance Brokers assists businesses and operators across rural, regional and metropolitan Australia with plant and equipment insurance. Regional operations can bring additional considerations, including availability of specialist repairers, recovery distances, replacement-part lead times and access to substitute plant while damaged equipment is being repaired.
Our team also works closely with rma network Livestock & Property Agents in rural communities, but plant and equipment insurance is available to businesses and operators regardless of whether they are connected to the rma network.
Why RMA Insurance Brokers?
RMA Insurance Brokers is a professional insurance broking firm, not an insurer. We review your plant and equipment exposures, compare insurer options and help arrange cover that reflects how your business operates.
- access to a broad range of insurers and specialist underwriting markets
- experience with owned, hired-in, hired-out and fleet plant arrangements
- clear explanations of hire-contract insurance obligations
- support with claims and insurer communications, including repair and valuation information where required
- advice built around regional access, downtime costs and replacement lead times
Frequently asked questions
What is plant and equipment insurance?
Plant and equipment insurance is designed to cover mobile plant, machinery, equipment and tools against risks such as accidental damage, theft, fire and certain other insured events. Depending on the policy, cover may apply to owned, hired-in or hired-out items, and may include items while in transit between sites or at a worksite.
The right structure depends on who owns the plant, how it is used, where it travels and the contractual obligations that come with hiring or leasing arrangements.
Who should consider plant and equipment insurance?
Plant and equipment insurance is worth considering for any business or individual that owns, hires, leases or operates mobile plant or specialised equipment. This includes earthmoving contractors, civil construction businesses, tradespeople, farmers with self-propelled plant, crane and access-hire operators, and businesses that hire equipment to others.
Does plant and equipment insurance cover hired-in plant?
Hired-in plant can often be included, but the arrangement needs to match the hire contract. Many hire agreements require the hirer to insure the plant or to indemnify the owner for loss or damage. A hired-in plant extension can help meet that obligation, subject to the policy terms, limits and conditions.
The hire agreement should be reviewed for damage obligations, continuing hire charges, recovery costs and indemnities, as not every contractual amount assumed under a hire agreement is automatically insured.
Is machinery breakdown covered under plant and equipment insurance?
Plant and equipment policies are generally focused on insured physical loss or damage. Mechanical or electrical breakdown may be excluded, restricted or available through an additional benefit or separate policy, depending on the insurer.
Where breakdown is a significant exposure, dedicated equipment breakdown cover may need to be considered. Business interruption, substitute-hire costs or other financial consequences following breakdown should also be checked separately rather than assumed.
Are tools and portable equipment covered?
Hand tools, power tools and portable equipment may be covered under a plant and equipment policy or a general property or business insurance package, depending on the insurer and the sums insured. Items left unattended in vehicles or public places are often subject to special conditions or exclusions.
It is important to declare the types of tools and equipment, their values and where they are stored or used.
Related insurance
Construction & Contract Works Insurance
Insurance considerations for construction projects, including works in progress, materials and project-related liability exposures.
Business Insurance
Broader insurance for business property, interruption, theft, equipment and other commercial risks.
Commercial Motor Insurance
Cover considerations for work utes, vans and other commercial vehicles used in day-to-day business operations.
Farm Motor & Agricultural Machinery Insurance
Cover considerations for farm utes, trucks, tractors, harvesters and other machinery used on or away from the property.
Transit & Cargo Insurance
Cover for stock, machinery, equipment and other goods while being transported by road, rail, air or sea.
Liability Insurance
Public and products liability insurance for third-party injury and property damage exposures.
Review your plant and equipment insurance
The plant you own, hire or lease changes over time, and so do the contracts and exposures that sit around it. The cover arranged when the policy was first put in place may no longer reflect the work you are doing today.
RMA Insurance Brokers can help you review whether your plant and equipment insurance still matches your assets, your hire arrangements and the way your business operates.
The information on this page is general information only and does not take into account your objectives, financial situation or needs. Cover is subject to the terms, conditions, limits and exclusions of the relevant policy. Insurance products and available cover vary between insurers. Please review the relevant policy documentation and obtain advice appropriate to your circumstances before making a decision.