What is an Installation floater?

If you run a contracting business, it’s very likely that you’re installing materials and/or fixtures as part of construction or renovation projects. Did you know that your business contents insurance only covers those materials while they’re in your shop or warehouse? Your customer’s home or business property insurance doesn’t apply until the materials are installed and the client signs off.

If your materials are stolen or damaged while awaiting installation or during the project itself, it could cost your business thousands of dollars. The best protection is to add an installation floater to your contractor insurance policy. This will help ensure your construction materials are covered end to end.

An installation floater is a form of builder’s risk insurance and the coverage is typically all risks, which means any cause of loss is covered unless it is specifically excluded. An installation floater can cover:

  • Lumber
  • Roofing shingles
  • Wood, laminate and other flooring
  • Pipe and plumbing fixtures
  • Wiring, lighting and electrical fixtures
  • And more

If you’re a subcontractor, you may be covered under the general contractor’s builder’s risk policy, but this isn’t always the case. Speak with one of our commercial insurance brokers today to go over all your contractor insurance needs. We’ll be happy to advise you on how to best protect yourself and your business.

Call us today to see how our brokers can help.

Does your contracting business need an installation floater?

Not all contracting businesses require an installation floater. For example, companies involved primarily in repair and service may not need it. Here are some businesses that should consider this coverage:

Part of a comprehensive contractor insurance policy

If your contracting business requires an installation floater, it’s as part of a larger contractor insurance package that will include general liability coverage, coverage for your tools and vehicles, and a commercial property policy to protect your office or shop.

Frequently asked questions about installation floater insurance:

An installation floater is a type of builder’s risk insurance that protects materials and equipment from the time a contractor takes possession of them until the materials are installed and the client signs off that the work is complete. As a contractor, if you don’t have this floater as part of your policy, you could be exposed to tens of thousands of dollars in losses if materials or equipment are stolen or damaged before the customer signs off on the job.

If you are a contractor installing something as part of a larger job, it’s a good idea to purchase installation floater insurance or confirm whether the general contractor or the manufacturer already have this coverage.

For example, if your run an electrical contractor business that is installing wiring and lighting fixtures, you should make sure the materials are covered either by a builder’s risk policy or an installation floater.

An installation floater can protect all of the building materials and fixtures you use during a project, but not your tools or vehicles, from any perils that are not specifically excluded. Typically this covers you for a lot of the same things that a commercial property policy covers including damage or loss from fire, wind, lightning, vandalism and theft.

Installation floaters can be added to a builder’s risk policy for a particular project. But more commonly, as a contractor that does installations all the time, you would add an installation floater with a rolling limit to your contractor insurance policy as an ongoing coverage. So for instance, if your rolling limit is $100,000, that means that at any given time you are covered for $100,000 worth of materials that are either being installed or awaiting installation.

An installation floater that is tied to a particular project may have an end date, so if timelines change, you should let your broker know about the change to ensure there are no gaps in coverage. If you have an installation floater as part of your ongoing contractor insurance package, delays or other changes to individual projects don’t need to be communicated to the insurer.

The good news is that many reputable contractor insurance packages will include a certain amount of installation floater coverage. In cases where coverage is an add-on, you can expect to pay $100 – $125 a year per $50,000 of ongoing coverage.

Installation floaters cover materials and equipment that are used for a specific project, whereas builder’s risk covers the entire infrastructure of the project being built or worked on. Builder’s risk, often known as course of construction insurance, covers that property, where an installation floater is designed for the equipment used for the job, onsite, offsite, and while in transit.

Your business is unique, so are your insurance options.

Being a brokerage for over 70 of Canada’s top insurance companies means our commercial brokers have access to a wide range of coverage options as unique as your business – at some of the best rates in Ontario. We sweat the details so you can focus on your business. Want to learn more about the coverage options available to you? Here’s a few of them.