If you sell high-value equipment, you’re in a high-demand business. But you’re also in a high-risk business. There’s a growing demand for heavy equipment such as cranes, bulldozers, excavators, forklifts, and tractors. These types of equipment are essential for the commercial, industrial, and agricultural equipment sectors.

“Despite near-term challenges in certain construction sectors, Canada’s construction industry is poised for significant growth,” according to ResearchAndMarkets, which predicts a compound annual growth rate in the market of 3.7% from 2024 to 2028. Canada’s construction output is also expected to reach $256.42 billion by 2028.

This growth is related to several factors, from government investment in housing and infrastructure projects, including transportation, utilities, and public transit systems, to increased demand for manufacturing facilities and logistics centres in the industrial sector. The commercial construction sector is also poised for recovery, according to ResearchAndMarkets.

Why do equipment dealers need insurance?

Theft, damage, or other losses could interrupt your business and negatively impact your bottom line. That’s why, no matter which sector your business is focused on — such as construction, mining, forestry, or agriculture — you need a tailored insurance policy to meet the specific needs of your business and your sector.

What is the biggest risk that equipment dealers face?

One of the biggest risks that equipment dealer face is theft — and it’s much more common than you might think. Thieves don’t just target equipment on construction sites; they also target dealerships, warehouses, and even cargo in transit. Stolen equipment can be resold as ‘refurbished’ by etching in a new VIN, a method known as Vehicle Identification Number (VIN) cloning. Even organized crime is getting in on the action — auto theft rings may also include heavy equipment, which could be shipped and sold overseas.

More than $124.6 million in heavy equipment was stolen in Canada between 2019-2023, according to Équité Association, with a recovery rate of just 23.92%. The five most common types of stolen equipment in North America are skid steer loaders, backhoe loaders, excavators, mini excavators, and dozers, according to the U.S.-based National Equipment Register (NER).

What are some other risks that equipment dealers should be aware of?

While theft is the biggest risk you may face, it isn’t the only risk. Here are some other risks that you may face as an equipment dealer:

Severe weather: Vandals aren’t the only ones who can cause damage to your inventory. Severe weather is another culprit, whether it’s floods, wildfires, or tornadoes. Even severe wind or torrential rain can cause significant damage. On a larger scale, a natural disaster could disrupt the supply chain or lead to shortages of key materials.

Supply chain disruptions: Natural disasters, transport delays, and quality control issues at suppliers can all cause supply chain disruptions. When demand outweighs supply, you may not be able to get the products your customers need — high demand vs. low supply can also increase theft of high-demand goods.

Man-made hazards: Poor housekeeping, mistakes, and accidents can also pose a risk to your business. Maybe someone doesn’t clean up a spill right away, causing a customer to slip, fall, and injure themselves. Or a smoldering cigarette butt ignites oily rags or waste materials that haven’t been disposed of properly.

Who needs equipment dealer insurance?

Whether you run a small retail operation or manage a major equipment dealership, insurance is a must if you sell high-value equipment — whether you’re a heavy equipment dealer, farm equipment dealer, or other type of equipment retailer.

What type of insurance do equipment dealers need?

Risk mitigation practices can help to prevent many of these losses — or at least minimize the damage. But some events are beyond your control, which is where insurance comes in. In addition to liability and property insurance, equipment dealers may want to consider other coverages as part of a customized equipment dealer insurance policy, such as:

  • Blanket Coverage: Provides blanket limit coverage for all of your business contents, whether on or off your premises.
  • Mechanic’s Warranty of Work: Provides coverage for installation, labour, and dealer errors and omissions.
  • Crime: Provides coverage for costs related to employee dishonesty, credit card forgery, and other types of theft by employees and others.
  • New Equipment Sales Protection: Provides coverage for claims or suits brought against you by a dissatisfied customer.

Keep your business safe with equipment dealers insurance

Unfortunately, you can’t always control what happens to your business. You can, however, control how prepared you are. Having the right protection in place can make a huge difference. To learn more, visit our equipment dealers insurance page today.

This blog is provided for information only and is not a substitute for professional advice. We make no representations or warranties regarding the accuracy or completeness of the information and will not be responsible for any loss arising out of reliance on the information. Terms, conditions and exclusions apply to coverage. See policy for details.