Equipment Rental Insurance Michigan Policy Information
Equipment Rental Insurance Michigan. If you own a business that rents out equipment to other businesses or individuals, then equipment rental business insurance is a paramount purchase to ensure your business' mitigation of liability and loss. Whether you're renting out rototillers for digging up a garden or party tents for weddings, covering your risks is an important part of being a responsible and successful business owner.
Contractor equipment rental companies provide heavy equipment to customers who do not need these frequently enough to justify the purchase, such as bulldozers, excavators or cranes. Equipment may be rented with an operator or without. Equipment may be rented on a short-term basis, or on a longer-term lease. Delivery and pickup services may be offered. Payments may be made at the time of rental for items needed for a short period of time, or periodically over the life of a lease. Unless a lease specifies differently, the rental company is responsible for maintenance and major repairs.
When you own a business that rents out equipment, the perils you face are very real. You may rent a piece of equipment to someone who subsequently becomes injured by the equipment. If this happens, you may be held responsible and held liable for the ensuing damages, including any medical costs and any costs for property loss. Equipment rental insurance Michigan can mitigate your losses and help your business maintain its growth despite any claims and lawsuits that might arise.
Equipment rental insurance Michigan protects your business from lawsuits with rates as low as $97/mo. Get a fast quote and your certificate of insurance now.
Basic Insurance for Rental Equipment Businesses
There are some basic coverage types that all businesses, including equipment rental businesses, must consider. Some of them include:
- General liability coverage. If you or someone working for you are held responsible for property damage or bodily ideury, then this Equipment rental insurance Michigan coverage can be a godsend.
- Property insurance coverage. This protection provides peace of mind that the investment you've made in your equipment is not a loss if someone damages or steals items from your equipment inventory. It also covers the physical building in which you do business and non-rental items inside.
- Commercial vehicle insurance. Auto insurance to cover your business vehicles is important. This coverage should extend to your employees who use company vehicles.
- Worker's compensation. This coverage is oftentimes included in mandatory state taxes. If not, it is a valuable coverage that provides monetary payments for illness or ideury related to work as well as medical payments for injured or ill workers.
Rental Equipment Coverage
There are two main areas of concern when it comes to the risks that you face with your rental equipment. The first of these is that the equipment is at risk of damage or loss when you rent it out to your customers. Secondly, it can become a source of bodily ideury or cause damage to property. Because of these risks, it is important to work with an insurance agent who understands the intricacies of such coverage and the overall nuances of the equipment rental business to find a an Equipment rental insurance Michigan policy package that covers your business from all angles.
The agent may recommend inland marine protection. This type of floater policy covers the equipment that you have both at your business and off the property, without regard to who is operating or handling the equipment. This all-risk policy generally has a per-loss deductible. Another common recommendation is enhanced general liability coverage. This type of policy can protect your business from property damage claims and claims of bodily ideury that arise from the operation of your business. This includes any rental items that your customers use.
Your Rental Business and Rental Agreement
In general, your business should have an attorney-approved rental agreement in place to allocate the responsibility of damage or loss of your rental items. This agreement should also address liability claims and the responsibility of payment of those claims. Still, regardless of the responsibility assigned to the customer by the rental agreement, your business still needs adequate Equipment rental insurance Michigan coverage. For instance, if there is a possibility that your customer lacks the knowledge or skill for proper equipment use, you may be left liable. If the customer loans out the equipment to someone else prior to returning it, you can be held responsible for losses or ideury from the third party.
The customer might also be unwilling to meet the obligations laid out under the agreement. It may also be the case that the customer absconds with the property, leaving you holding the bag for replacement. In these scenarios, the right level and type of coverage can mitigate these losses and leave your business whole again.
If you rent out equipment that has a high replacement value, it may be best practice to require that the customer purchase insurance that covers any liability or loss for both the customer and your business and furnish you with a certificate of insurance to prove coverage.
MI Equipment Rental Companies Risks & Exposures
Premises liability exposure is moderate due to customers coming to the premises. Aisles must be adequate in size and free of debris with flooring in good condition. There should be no frayed or worn spots on the carpet, and no cracks or holes in the flooring. Sufficient exits must exist and be well marked, with backup systems in case of power failure. Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls.
Contractors' equipment stored in the yard presents an attractive nuisance to children and teens. Fencing and barriers must be in place to prevent entrance, and the equipment disabled. Off-premises exposures are high, especially if the equipment is rented with an operator as liability extends to that employee and the use of the equipment. To limit contractual liability exposures, all items must be in good repair and not be altered in any way as any alteration could place the product liability exposure on the rental company.
There must be documented maintenance of the items in case an accident does occur and the product manufacturer cites lack of proper maintenance. Instructions for proper usage and all warnings about the product must be provided to the client. Machinery or equipment that could cause serious injury to the operator needs careful demonstration and instruction. The age and condition of the equipment are also critical.
Products liability exposure arises from the sale of used rental equipment. Items sold should be in good condition, without any modification, and should have all guards and protective devices intact.
Environmental impairment liability exposure is high due to the potential for contamination or air, surface or ground water, or soil from spillage or leakage of fuel storage tanks or the collision or overturn of heavy equipment or their transporting vehicles. If there are underground storage tanks, a UST policy will be required. All storage and disposal procedures must meet federal and state regulations.
Workers compensation exposure depends upon the type of maintenance and repair done to the rental equipment and whether items are rented with operators. Injuries may include cuts, amputations, burns, welding-related losses, back sprains, and hernia from lifting, foreign objects in the eye, slips, and falls. If the setup is done at customers' job sites or equipment is rented with operators, the rental company has little control over the customers' premises or hazards which may be in isolated areas or on rough terrain.
Employees can be injured off-site by slips and falls, rollover of machinery, falling objects, falls from heights, construction machinery of others, flying debris, or noise. Rupture of a fuel line could result in an explosion. A malfunction in the wiring could present a fire or electrocution hazard. If employees must handle any repossession, they may be assaulted or otherwise endangered during the repossession activity.
Since work at the office is done on computers, potential injuries include eyestrain, neck strain, carpal tunnel syndrome, and similar repetitive motion injuries that can be reduced with ergonomically designed workstations.
Property exposures include an office, storage and maintenance area, and yard for heavy equipment. Ignition sources include electrical wiring, heating and air conditioning systems, overheating of equipment, welding, and soldering. Flammable liquids such as paint, varnish, glue, and fuels used on-site for repairs and refueling must be stored away from heated areas in a fireproof cabinet. When welding and soldering take place on premises, they should be done in a well-ventilated area that is free of combustible materials.
Some equipment may require high voltage to operate, increasing its susceptibility to fire. All items must be stored in such a way that fire will not spread quickly. Unless disposed of properly, greasy, oily rags (such as those used to clean machinery) can cause a fire without a separate ignition source. Aisles must be kept free of debris. Property stored in the open may be subject to loss by wind or hail or a target for vandalism.
Appropriate security controls must be taken including lighting and physical barriers to prevent entrance to the premises after hours and an alarm system that reports directly to a central station or the police department. Business interruption is a significant exposure, as large equipment rental tends to be seasonal. Loss of or damage to a large or expensive piece of equipment may result in the item not being available at a critical time.
Crime exposure is from employee dishonesty and money and securities. The exposure increases in the absence of background checks of all employees. Heavy equipment is expensive and a target for theft. Items must be carefully inventoried as they leave from and return to the premises to prevent employee intervention. All ordering, billing, and disbursement should be handled as separate duties. Frequent deposits should be made. Audits should be conducted annually.
Inland marine exposure is from accounts receivable if the company offers credit, computers, contractors' equipment, and valuable papers and records for customers' and suppliers' information. Ideally, equipment should be rented with a qualified operator who is aware of the proper use and handling of the item and who can refuse to do something that would exceed its capacity or otherwise endanger it.
When equipment is rented without the operator, instructions and clear guidelines must be provided as to how the equipment may and may not be used. The contract should hold the client legally liable for the items while in their care, particularly if the rented items are used to lift beyond their capacity, but secondary coverage is needed, as the customer may not be able to cover the cost.
Contractors' equipment may be damaged by fire, wind, hail, collision, overturn, or while being loaded or unloaded onto transporting vehicles. Theft is a concern as items are often left unattended at job sites or in storage yards at night and on weekends. The equipment should be disabled while not in use to reduce the potential for theft.
Commercial auto exposure may be limited to hired and non-owned for employees running errands. If pickup and delivery services are offered, the exposure increases significantly due to the potential for loss while loading, unloading, and transporting equipment. Transportation of heavy equipment requires careful loading and tie-down to prevent items from coming loose and toppling over during transport. Drivers should have an appropriate license and an acceptable MVR. All vehicles must be well maintained with documentation kept in a central location.
Choosing Your Equipment Rental Insurance Policy
Work with a commercial agent when choosing equipment rental insurance. Your agent is adept at understanding your unique needs and can recommend the right level and type of coverage for you and your business. By explaining your business model and the risk that customers may face when renting from you, your agent is better able to understand how much insurance, the type of Equipment rental insurance Michigan insurance, and the level of coverage that your business needs.
Your agent can customize your insurance package to meet your needs and can compare rates for insurance policies that meet your needs with different companies. This gives you the ability to find the right Equipment rental insurance Michigan policy for your budget.
Michigan Economic Data And Business Insurance Requirements
Business owners who are interested in establishing operations Michigan must have a thorough understanding of the state's economy. They should also familiarize themselves with any regulations and limits that state may have in place for commercial insurance.
Any entrepreneur who is thinking about starting a business in the Great Lake State first needs to determine if it's a feasible location for business operations. As such, it's important to have a keen understanding of pertinent details regarding the economy of Michigan, in addition to the types of insurance coverage that are mandatory for corporations that operate within the state.
Economic Trends for Businesses In Michigan
After a long period of stagnant job growth in the early part of the 21st century, MI has been experiencing a steady increase in employment gains. Between 2009 and 2018, the state has enjoyed a period of uninterrupted job growth; the longest stretch of job growth since World War II. According to economists at the University of Michigan. While there has been a slight decline in the rate of job growth, job creation continues and forecasters say will continue for the next two years, into 2021.
In 2018, an estimated 55,200 jobs were created; in 2019, it's expected that 35,800 jobs will be created, and in 2020, economists believe that there will be a total of 39,300 jobs created in Michigan. While that rate of growth is 1.9 percent slower than the job growth rate between 2011 and 2016, it is still a steady increase overall. In total, approximate 683,200 jobs will be created in MI between 2099 and 2020; almost four out of the five jobs that were lost during the early part of the 21st century will be recovered.
While the unemployment rate has steadily improved, it is still above the national average. In March of 2019, the national unemployment rate was 3.8 percent, while in the state of Michigan, it was 4.0 percent. Mid-Michigan has experienced the largest growth rate in the state, and according to forecasters, it looks like that trend will continue, moving forward. Industries that are expected to see the most growth include:
- Energy, due largely to research and development in clean energy
- Food and agriculture
- Transportation and mobility
- Healthcare industry
- Information and technology
In the state of MI, business owners are not legally required to carry liability insurance; but most entrepreneurs opt to invest in a General Liability or Business Owner's Policy (BOP). A commercial auto insurance policy is also required for any businesses that use motor vehicles to conduct any aspect of their business operations. Workers' compensation insurance is also required for any businesses with non-owner employees. While the following forms of coverage are not required, depending on the type of business you operate, they are recommended:
- Data breach insurance
- Business income insurance
- Commercial Umbrella insurance
Additional Resources For Retail Insurance
Read valuable small business retail insurance policy information. In a retail business, you need to have the right type of commercial insurance coverage so that your store, employees, and inventory are protected.
- Adult Novelty
- Appliance & Electronics Store
- Art Gallery
- Bicycle Shop
- Book Store
- Bridal Shop
- Candy Confectionery Store
- Carpet Store
- Clothing Store
- Collectibles Memorabilia Store
- Convenience Store
- Cosmetics Store
- Dry Cleaning
- Equipment Rental
- Funeral Home
- Furniture Store
- Gift Store
- Hardware Store
- Home Improvement Store
- Hotel Motel
- Ice Cream Shop
- Jewelry Store
- Lingerie Store
- Luggage Store
- Music Store
- Office Supply Store
- Paint & Wallpaper Store
- Pet Store
- Pharmacy Liability
- Plumbing Supplies Fixtures Store
- Scrap Metal Dealers
- Sewing Store
- Shoe Store
- Sporting Goods Store
- Stationary Store
- Thrift Store
- Ticket Agency
- Tobacco Store
- Toy Store
- Travel Agency
- Wig Store
Retail stores are susceptible to premises liability claims because of customer traffic, but large department and specialty stores are more susceptible than most.
All retail stores have significant property exposures. The on-hand stock represents a considerable investment, but the amount on hand fluctuates seasonally. For this reason, physical damage insurance on this property must be arranged carefully. When the insured occupies a non-owned building, insurance coverage must be arranged for the insured's interest in extensive improvements and betterments made to the premises.
Crime insurance, in the form of employee theft and money and securities coverage, is also very important.
The businessowners policy was designed with retail exposures and operations in mind. For this reason alone, it should always be the first type of package coverage to consider. However, for those risks not eligible for the business owners policy program, the commercial package policy (CPP) is a practical and convenient way to combine a number of coverages into one policy.
Retail businesses generate income through interaction with customers. This interaction is also how a customer can sustain an injury and then sue the retailer for damages. Hazards, exposures and operations both on premises and off are important and must be covered, but liability the retailer may incur because of the merchandise sold must also be considered and insurance protection arranged.
Inventory or stock is the major property exposure for most retail operations. Because stock values tend to fluctuate or have significant peaks at certain times of the year, value reporting or peak season valuation options should be considered. Business income coverage, including business income from dependent properties coverage, may mean the difference between a retail operation staying in business or being forced into bankruptcy following a loss.
When the insured occupies a non-owned building, insurance coverage must be arranged for the insured’s interest in extensive improvements and betterments made to the premises.
Most retail businesses offer endless opportunities for a variety of criminal activities. For this reason, the coverages needed must be carefully evaluated. Holdup and robbery losses may be the most obvious concerns but employee theft, fraud and counterfeit money losses are also serious issues that cannot be dismissed.
Retail businesses are gaining greater exposure to international issues because of the growth in sales via the internet. As these sales increase, the added exposures faced by these retailers must be evaluated. While their operating horizons are expanding so are their potential loss exposures.
Minimum recommended small business insurance coverage: Business Personal Property, Business Income and Extra Expense, Equipment Breakdown, Employee Dishonesty, Money and Securities, Accounts Receivable, Computers, Valuable Papers and Records, General Liability, Employee Benefits, Umbrella, Hired and Non-owned Auto & Workers Compensation.
Other commercial insurance policies to consider: Building, Earthquake, Flood, Leasehold Interest, Real Property Legal Liability, Computer Fraud, Forgery, Bailees Customers, Goods in Transit, Jewelers Block, Cyber Liability, Employment-related Practices, Business Auto Liability and Physical Damage and Stop Gap Liability.
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Also learn about Michigan small business insurance requirements for general liability, business property, commercial auto & workers compensation including MI business insurance costs. Call us (313) 344-7177.