Some hire contracts may provide a damage waiver. This means you pay an additional fee to cover the item whilst on hire. However, many damage waivers provide limited cover, eg Fire & Theft only with no cover for damage whilst the item is in use and some even exclude theft.
If a damage waiver option is provided under a hire agreement, it is important that you confirm the scope of cover provided, as well as the excess payable in the event of a claim which can sometimes be can be quite high.
If you are hiring plant and machinery regularly, it would not only be a cost effective option to look at obtaining an annual policy but it generally provides you far better protection.
An annual Hired-in Plant Insurance provides the following benefits:
1. Substantial Savings
Many hire companies charge upwards of 10% loading to provide a damage waiver. If you are regularly hiring plant and equipment, having an annual policy can result in substantial savings. Policies are based on:
– the type of equipment you hire. It is important to specify any items that you may be hiring in order for them to be covered
– An estimate of annual hire fees paid (this is adjusted at the end of the period)
– Limit any one item. This should be the maximum market value for any one single item
– Maximum value of items insured at one location. This is the maximum exposure for all items on hire at any one single location
2. Broad cover
Cover for material loss or damage which includes cover whilst the item is in use and covers theft. This covers the gap in hire agreement where the damage waiver provides limited cover and leaves the hiree exposed to uninsured losses.
Standard excess applies.
4) Legal Costs
In the event of a legal dispute between the hire company and hiree, costs can be covered up to a specified amount (commonly up to $50,000)
5) Loss of hire fees
Commonly, in the event of loss or damage, the hiree will be required to continue to pay the hire costs for a period of time or until the item is repaired and available for hire again. Subject to a waiting period (commonly 7 to 14 days), cover for which you are held responsible is covered following loss or damage to a hired item (commonly up to $50,000)
Important Note Regarding Liability Insurance
Whilst Hired In Plant & Machinery Insurance provides cover for the item on hire, it does not cover Public Liability Insurance.
A separate cover should be obtained to cover your business for personal injury or property damage whilst operating the plant or equipment.
Disclaimer – “This material contains general information only and may not suit your particular circumstances. To decide if a policy is right for you please carefully read the relevant Product Disclosure Statement (PDS) and/or Policy wording. While we have exercised due care and skill in preparing this information, Optimum Insurance Services (Optimum) does not accept any legal responsibility or liability for negligence or otherwise to you or anyone else who seeks to rely on this information. This includes, without limitation, loss arising from a possible failure of the information to comply with statutory or regulatory requirements or the failure of the information to identify other terms and conditions beyond those considered in this document. You should obtain advice to ensure that your policy provides adequate cover for your circumstances.
“Optimum Insurance Services Pty Ltd is a Corporate Authorised Representative of Insurance Advisernet Australia Pty Ltd (Car No. 291220), Australian Financial Services Licence No 240549, ABN 15 003 886 687.”