The number of tool thefts from construction sites and work vehicles across New Zealand is on the rise, and some tradies are being caught without adequate cover to replace them.
If you have the right insurance, being a victim of crime can be a major inconvenience that causes stress and costs valuable time.
But if you haven’t got comprehensive insurance for your tools, having your work site or vehicle raided by thieves can be an extremely costly exercise for your business.
The construction site crimewave
Police have warned tradies, particularly builders, project managers and contractors, to be vigilant and to secure their tools following the spike in burglaries.
All over the country, tradies have been reporting burglaries from building sites, secure sheds, and work vehicles—even when they’re parked in private driveways.
“We’ll do all we can to recover your stolen tools, but crime prevention has to start with you,” police say.
Tips to protect your tools
- Engrave your tools with your driver licence number; it’s much easier for police to return them to you if they are found.
- Keep a record of the serial numbers.
- Report any suspicious activity on construction sites to police.
- Take you tools home with you, or lock them up in a shed on site.
- Don’t leave tools in unattended vehicles overnight.
How to insure your tools
If you’ve had your tools stolen, you’ll know how frustrating it is. First there’s the sinking feeling that someone’s ripped you off.
Then you have to spend the morning making a police complaint, listing all the tools you’ve lost, and, if you have tool insurance, contacting your provider to make a claim. All the while, you miss hours, and potentially days, of productive work.
But if you have comprehensive cover for your tools and equipment, at least you can take comfort in the fact that you’ll get a new set of tools quickly and at little cost.
Keep stock of your tools
The first thing you need to do is keep your asset register up-to-date. If you want your insurance claim to go as quickly and smoothly as possible, you should list the following:
- Item description, including model number.
- Serial number.
- Date of purchase.
- Purchase price.
- Photos of the products may also be helpful.
You then need to talk to a trusted insurance adviser about the best policy options for you and your business. In most cases, you’ll be looking at a Tools and Equipment, Tools of Trade insurance or Business Assets policy, but it can also have other names.
Hidden caveats to watch for
- Replacement or indemnity value?
BRAVEday lead insurance adviser Kane Butler recommends businesses always opt for replacement value. While indemnity or market value may have lower premiums, it means you will only receive what the insure considers the item to be worth at the time of a claim. So if someone stole your circular saw that cost $400 three years ago, your insurer might only pay out a fraction of that. Replacement value means you get the same item, regardless of how old the stolen one may be.
Tip: Make sure to read the small print as some insurers will revert to market value on items more than a few years old. - Be aware of excess levels!
Kane says that some tools and equipment policies have excesses as high as $2500, which would put some people off making a claim altogether. You want to know that your provider has got your back when things go wrong and not have to worry about paying exorbitant excesses, especially when you’ve had items stolen. - Does the policy have an automatic reinstatement clause?
This simply means that your policy renews and continues as normal immediately upon an insured event (when you make a claim). Kane says including an automatic reinstatement clause is “a must” if it’s available. This means you’re protected from the moment you pick up your new set of tools without having to renegotiate with your insurer. - What’s the definition of theft?
Tools and equipment policies often define theft and burglary differently. Theft is generally deemed to be when an item is stolen without any sign of forced entry (unlocked van, unsecured building site). Burglary is generally defined as forced entry (breaking in a locked door, or secured area). Some policies might only cover you for burglary and not theft. Excesses for each can differ significantly, however specialist insurers may have more flexible options.
Kane says that tools and equipment policies aren’t as expensive as they used to be and many insurers have developed trade specific products that offer better terms and definitions than older, broader-ranged policies.
“Historically insurance for a builder’s tools has been expensive, contained high excesses and settlement conditions that meant a claim payment was never enough to replace the lost items,” Kane says.
“There are now options available to provide full replacement cover and very competitive premiums with excesses as low as $100.”
Does your trade business have all its bases covered? It pays to check—and with our quick-check guide to tradie insurance, it's easy!
