There are two different inland-marine coverages here, and the reason HVAC contractors confuse them is that both protect “the equipment” — just not the same equipment. Contractors equipment, usually written as an equipment floater, covers the tools and gear that move with your crew. An installation floater covers the units and materials you are installing for a customer, until they become part of the building. Carrying one does not give you the other, and the most common HVAC coverage gap is a shop that insures the tools in the van and quietly assumes the same policy covers the condensers staged on a jobsite. This guide draws the line between the two, names where builder’s risk fits, and shows what to check on your own policy.
The distinction matters because the property is in motion the whole time. Tools ride to the job and back; new units come off a truck, sit in a garage or a staging area, and get set days later. Inland marine is the family of coverage built for property that moves and property away from your premises, and within it these two floaters answer two different sets of that property. The full treatment of the working-assets side lives on our contractors equipment page; this post stays on the question contractors actually search — which floater covers what, and which one you might be missing.
What contractors equipment (the equipment floater) covers
Contractors equipment is the coverage for the things you own and use to do the work. On an HVAC truck that means recovery machines, vacuum pumps, micron gauges, manifold sets, nitrogen regulators, coil cleaners, core removal tools, meters, and the rest of the hand tools and gear that ride from job to job. It is a first-party coverage — it pays you for damage to or loss of your own equipment — and it is built around the defining fact that this gear moves: it is covered on the jobsite, in transit, and in storage, not just sitting at a shop.
This is the same first-party exposure the golden post on completed operations sets aside as never a liability matter. Your own tools and equipment are never answered by general liability; that exposure runs to contractors equipment, full stop. An equipment floater is what stands behind the recovery machine that walks off a jobsite or the gauges crushed when a ladder rack lets go. Forms and terms vary by carrier, so confirm what your policy names — but the working principle is consistent: contractors equipment is your gear, the equipment that moves with the crew.
What it generally is not built to cover is the property you are installing for the customer. That is a different floater, and the difference is the whole point of this post.
What an installation floater covers
An installation floater covers the HVAC units and materials you are installing — the condensers, air handlers, furnaces, coils, line sets, ductwork, and controls destined to become part of a customer’s building. The coverage follows that property through its vulnerable window: in transit from the supply house, in storage or staging before the set, and on the jobsite during installation. It answers theft of a condenser staged overnight, fire that takes out units in a garage before they go in, or damage to an air handler dropped during a rooftop set.
The defining feature of an installation floater is when it ends. Coverage runs until the unit is permanently incorporated into the structure — once it is installed and accepted as part of the building, the floater’s job is done, and the structure’s own coverage is what stands behind it from there. That cutoff is the line worth reading on your own policy, because the exact language varies by carrier, but the concept is consistent: the installation floater covers the equipment from the supply house to the moment it becomes part of the building.
Here is the gap that catches shops. Many HVAC contractors carry contractors equipment and assume it covers the units they are installing — but equipment coverage is built around the gear that moves with the crew, not the property being installed for a customer. If your work includes staging and setting new units, the installation-floater exposure is real, and it is usually a separate grant. Confirm which your policy actually provides; do not assume the equipment floater reaches the condensers on the jobsite.
Where builder’s risk fits — and why it is not yours
Builder’s risk gets named in the same breath as these floaters, so it is worth placing precisely: builder’s risk covers the structure under construction itself, and it is typically carried by the general contractor or the building owner, not by the HVAC sub. It is the policy behind the building as it goes up — the framing, the roof, the shell — not behind your tools and not behind the specific units you are setting.
That separation is why a commercial contract can require one party to carry builder’s risk on the project while still expecting each trade to insure its own installed work and its own equipment. The three coverages stack on a jobsite without overlapping: builder’s risk on the structure, an installation floater on the units you are installing into it, and contractors equipment on the gear you brought to do the work. Reading a contract, the thing to confirm is who carries which — do not assume the general contractor’s builder’s risk reaches your staged units, and do not assume your equipment floater does either.
Replacement cost vs actual cash value
Once you know which floater covers which property, the term that decides how much you actually recover is the valuation basis. Replacement cost pays to replace the lost or damaged property without a deduction for age and wear. Actual cash value (ACV) pays the depreciated amount — what the property was worth at the time of loss, after subtracting for its age and condition — which on installed HVAC equipment can land well short of what a new unit costs.
That difference is not academic on this trade. A condenser stolen off a jobsite, a recovery machine destroyed in a van fire, an air handler damaged before it is set — under replacement cost, the floater works toward making you whole on a new unit; under actual cash value, you absorb the depreciation. Read both your contractors equipment and your installation floater for which basis they use, because forms vary by carrier and the gap between the two valuations is exactly the kind of surprise that surfaces only at claim time. Where you can, confirm replacement-cost valuation on the property that matters most.
How to check your own policy
The distinctions above turn into a short list of things to confirm on your own forms — the actionable part of this post. Forms and terms vary by carrier, so confirm what your policy actually names rather than assuming:
- Confirm you have contractors equipment for the gear that moves. Recovery machines, gauges, vacuum pumps, manifolds, and hand tools should be covered on the jobsite, in transit, and in storage — not just at a fixed location.
- Confirm whether you have an installation floater for the units you set. If you stage and install new equipment, check that the condensers, air handlers, and materials are covered until they are permanently incorporated into the structure — and do not assume the equipment floater already does this.
- Read the valuation basis on both. Confirm whether each coverage pays replacement cost or actual cash value, and push for replacement cost on the property that would hurt most to replace at depreciated value.
- Match the coverage to your real job mix. A service-and-changeout shop leans on the equipment floater; a new-construction or commercial installer carries more installation-floater exposure. Read the policy against what you actually do, not against a generic template.
- Confirm who carries builder’s risk on commercial jobs. Read the contract so you know the general contractor or owner carries the structure, and that your installed units still need your own floater behind them.
Carry both seams deliberately
An HVAC shop moves two kinds of valuable property every working day — the gear that does the job and the equipment going into the building — and they are answered by two different inland-marine coverages, not one. Carry contractors equipment for the tools and gear that ride with the crew, confirm an installation floater stands behind the units you set until they are built in, and read both for whether they pay replacement cost or depreciated value before a loss makes the question expensive. The related seams sit close by: theft from the van or jobsite is the most common claim on the equipment side — see does insurance cover tools stolen from my van — and the crane-set exposure on rooftop work runs to riggers liability, a different inland-marine coverage again. When you are ready, start a quote, read the full contractors equipment treatment to see how these floaters sit together, or step back to what drives HVAC insurance costs to see where they fit in the program.