You can insure your tools so they’re protected wherever you use them, but the type of coverage you need depends on how you use them and how much they’re worth.
How can I cover my tools?
The best way to cover your tools will depend on how you use them. Either way, you’ll typically be covered for theft or damage of your tools.
If you use your tools for personal use
If you use your tools for hobbies or home repair, and aren’t paid for projects you use your tools on, you can get coverage through your homeowners or renters insurance.
- Insurance for inexpensive tools. Your homeowners or renters insurance likely already covers your tools if they’re stolen or damaged in certain covered events. But most policies have a per-item limit, so tools over $1,000 may need additional coverage. And it likely won’t cover losing your tools or accidentally breaking them.
- Insurance for expensive tools. If you have pricey power tools that cost more than your policy’s limit, you can get valuable personal property insurance, also known as scheduled property insurance, to cover them. You’ll be able to add extra coverage for each individual tool at full value to your homeowners or renters insurance, and these policies often cover tools that are broken or lost as well as stolen.
If you use your tools for business purposes
If you use your tools for business purposes, they might be excluded from coverage in your homeowners or renters policy — you’ll need to talk with your insurer to find out for sure.
If that’s the case, you can protect them with contractors equipment insurance. This is a form of business insurance that protects your tools most places you take them, including on the job site. It covers you for:
- Theft. You should be covered if someone steals your tools.
- Damage. You should also be covered for accidental damages that happen to your tools.
- Damage to rented or leased tools. Some policies will also cover tools that you rent or lease.
Compare homeowners insurance to protects your tools
Why get insurance for your tools?
If you have a nice collection of tools, it makes sense to insure them for a number of reasons:
- Tools are a prime target for thieves because some can be quite small and easy to conceal.
- It’s easy to lose or damage tools when taking them from site to site.
- Tools can be vital to your business or home repairs.
- Rebuilding your tool collection can take time, especially if you don’t have the cash.
What do I do if my tools are stolen?
If someone steals your tools from your home or car, there are steps you can take to improve the chances of getting your tools back or of having a successful claim. Here’s what you need to do:
- Call the police. This is important because without a police report, you can’t claim for theft. Tell the police what was stolen and everything you can remember about when you last saw the tools, as well as anything you noticed when you first realized they were missing. Get a copy of the police report.
- Contact your insurer. Notify your insurer of the theft as soon as possible.
- Gather documentation. In addition to the police report, you’ll need to demonstrate that you owned the tools that were stolen. You can use old receipts or even photos of you with the stolen tools.
- Submit your claim. Your insurer will send you a claim form or you can usually submit a claim online. Fill out the claim form in as much detail as possible and submit it with all your documentation and anything else the insurer requests.
- Replace your tools. In most cases, your insurer will send you a check to cover the cost of repairing or replacing the tools. If your claim is denied or you feel like the amount you were given won’t cover the cost, you can appeal and the insurer will review your claim. If you are still unhappy, you can appeal to your state’s insurance department.
What’s not covered by tool insurance?
Exclusions vary based on your insurer and policy type, but you generally won’t be covered for:
- Normal wear and tear on your tools. You won’t be covered for normal wear and tear, which includes rust and gradual deterioration.
- Intentional damage. Your insurer will deny your claim if it finds that you intentionally damaged your tools or the damage was the result of you acting recklessly.
- Mechanical faults. Insurance doesn’t typically cover malfunctions. You’ll need to take that up with the manufacturer.
- Confiscation by the police. If your tools are confiscated lawfully, your insurer is not obligated to replace your tools.
- Scratches and dents. These don’t rise to the level of significant damage, so you won’t be covered.
- Tools that are being repaired. Your insurer may not cover you if a third party damages your tools while repairing them.
If you have under $1,000 worth of tools that you use for home projects and hobbies, you may already be covered by your homeowners insurance — but you should check with your insurer to find out exactly what you’re covered for. If you have pricey tools that you want additional coverage for, compare home insurers with valuable personal property coverage if you use your tools for personal reasons, or take out contractors equipment insurance if you use your tools for business.
Frequently asked questions about tool coverage
More guides on Finder
Compare home renovation insurance
Transform your home without leaving insurance gaps while your home’s under construction.
Asbestos and home insurance
Learn when your home insurance policy would and wouldn’t pay to remove this building material.
Which US states are hit most often by hurricanes?
We took a stroll down hurricane alley to learn which states are the most at risk for being hit, what time of year is the most active and which violent storms cost the most.
Does home or renters insurance cover eviction?
Learn what your policy covers and how eviction affects your insurance.
Home improvements that lower homeowners insurance
Save up to 20% on your home’s policy by improving its safety and security.
What to pack in a hurricane preparedness kit
Stock up on essential supplies to help you through a hurricane evacuation or bunker down at home.
Compare multifamily home insurance
Welcoming extended family or friends to live in your home is fine with your home insurer, but you might need to tweak a few coverage types.
Openly home insurance review Jan 2023
Robust coverage and high limits on this startup’s standard policies if you own a high-value home.
Assurant home insurance review
Insure homes in almost any condition with this widely available company, though it’s difficult to find more information.
What does renters insurance cover?
Renters insurance is a low-cost way to make sure your personal belongings are protected.
Ask an Expert