Heavy equipment insurance is a type of business insurance that covers the cost of repairing or replacing heavy machinery – such as excavators, bulldozers, and cranes – if it’s damaged, stolen, or vandalized.
Sometimes called an equipment floater or tools and equipment insurance, it’s a must-have for construction business owners and contractors who own or rent any transportable tools or equipment they need to complete their building or renovation projects.
A typical policy covers repair or replacement costs if insured equipment is damaged, stolen, vandalized, or affected by events like fire, collision, rollover, or severe weather.
Because heavy machinery is highly mobile and expensive to replace, heavy equipment insurance helps ensure unexpected accidents or incidents won’t severely disrupt your project timelines or your cash flow.
What Counts as Heavy Equipment?
In insurance terms, any tool or piece of equipment worth $2,500 or more is considered heavy equipment. Items worth less than $2,500 – hand tools, power tools, safety gear, and measurement devices – are classified as tools.
When we think of heavy equipment, think of heavy-duty vehicles designed to tackle construction and earthwork operations – road and railway bed construction, topsoil and rock excavation, dredging, and land grading.
The most common types of heavy equipment used by construction, excavation, and mining companies in Canada include:
- Backhoes
- Bulldozers
- Compactors
- Cranes
- Dump trucks
- Excavators
- Hydraulic mining shovels
- Skid steers
- Trenchers
- Loaders (front loader, bucket loader, payloader, wheel loader)
- Motor graders
- Telehandlers or boom lifts
Who Needs Heavy Equipment Insurance?
Any contractor or business that owns, rents, or leases heavy machinery to do its work needs heavy equipment insurance. Wherever a contractor works, their contractor insurance policies go with them — and the same applies to heavy equipment coverage. Professionals who typically need it include:
- Arborists
- Commercial or residential builders
- Construction contractors
- Excavation experts
- Landscaping and hardscaping professionals
- Logging companies
- Oil and gas pipeline construction professionals
- Renovation experts
- Road construction crews
- Snow removal operators
What Does Heavy Equipment Insurance Cover?
A heavy equipment insurance policy provides financial support to repair or replace equipment that is lost, stolen, or damaged or destroyed by vandalism, fire, water, collision, rollover, or natural disasters.
What Heavy Equipment Insurance Doesn’t Cover
A heavy equipment insurance policy won’t pay for damage or loss caused by:
- Poor or irregular maintenance
- Normal wear and tear
- Deliberate acts to damage the equipment
- Equipment that’s beyond its useful lifecycle
If your equipment is licensed, has a license plate, and used on public roads, you may require commercial auto insurance instead of heavey equipment insurance.
How Much Does Heavy Equipment Insurance Cost in Canada?
Heavy equipment insurance costs start at approximately $450 per year for $25,000 of coverage.
Insurers determine the price of a policy based on factors about your business or operations, including:
- Your location
- Your business operations and services
- Whether you own or lease the equipment
- The type of equipment, its make, model and year
- The value of the equipment
- Your insurance claim history
The best way to know how much a heavy equipment insurance policy may cost you is by getting a free quote in under five minutes.
Does Heavy Equipment Insurance Cover Equipment You Lease?
Not automatically – insurance for construction companies or a contractor’s insurance policy may not cover leased or rented equipment, so it’s worth verifying with a licensed broker before a project begins.
Start by thoroughly reading the leasing agreement for the equipment in your possession. It may require you to buy additional heavy equipment insurance. If so, you can add an endorsement to your existing policy to ensure the equipment you rent, lease, or borrow is fully protected.
Get the Heavy Equipment Insurance You Need Quickly
Don’t take chances with your finances or expensive equipment. Protect your business and assets with heavy equipment insurance.
Fill out our online application to get a free quote in under five minutes.
Our team of brokers will shop our network of 50+ insurance providers to find the right coverage you need and customize it to meet your requirements and budget.
– Updated July 22, 2026.
Related Posts
Categories
Recent Posts
What Is Tenants Legal Liability Insurance? A Guide for Canadian Business Tenants
If you rent or lease commercial space, your landlord can hold you financially responsible for damage to it – even when the damage was an accident. Tenants legal liability insurance covers those costs. Here's what it protects, what it won't, and what it costs.
What You Need to Know About Landlord Insurance for a Rooming House
Rooming houses carry risks a standard landlord policy wasn't built for. Here's what rooming house insurance covers, why it costs more, and how Canadian landlords can lower their premiums.
10 Insurance Gaps Most Small Businesses Miss (And How to Fix Them)
Ensuring your business is fully covered can be a challenge. Here are 10 common insurance gaps small business owners might miss and what to do to address them to ensure you’re adequately protected.