Forestry is a dangerous industry, and among its many niches, logging stands out as especially hazardous—not just for people but for equipment. It is common for logging companies to face damage, destruction, and theft of their equipment while out on a tract of densely forested, uneven land.
Excellent forestry equipment insurance is non-negotiable in this environment. Still, even good policies can have coverage gaps due to poor planning. Forestry equipment insurance should provide peace of mind to logging companies, not serve as a source of stress.
Here is what loggers should know about avoiding pitfalls in forestry equipment insurance so your coverage protects you when you need it most.
What is Forestry Equipment Insurance?
Forestry equipment insurance is an overarching type of protection that addresses multiple perils common in the logging industry. These most often include:
- Rented equipment coverage
- Coverage against equipment damage
- Provision of replacement cost should equipment need to be swapped on the job
- Financial compensation for vandalized or stolen equipment
Policies can include further protections depending on the insurance agency and budget of the logging company. To establish that your logging business is adequately protected, secure policies that address all hazards that can befall your company due to your machinery. The best policies for well-rounded coverage surrounding equipment are:
Equipment Damage and Theft
The most basic equipment insurance, a damage and theft policy, will compensate logging companies if their equipment is damaged or stolen during work. Damage must be accidental; intentionally sabotaging a device or using it outside the manufacturer’s specifications does not qualify for coverage.
Liability Coverage
Machinery—especially the heavy equipment used in logging—can pose significant risks to the people and property around it. Liability coverage offers financial assistance for equipment accidents, such as when a third party is injured by the machinery or their property is damaged. Anything from leaving deep treads in a person’s yard to crushing their car with a wayward log could be covered.
Business Interruption
When machinery fails, typically, loggers cannot continue their work until it is repaired. Business interruption insurance offers financial stability during equipment downtime until production can get back on track.
Common Pitfalls in Forestry Equipment Insurance
Simply having forestry equipment insurance is insufficient to guarantee that your company is adequately protected. Two common mistakes are insufficient coverage that does not fully address your logging activities or underinsuring equipment so that repairs exceed the compensation of your insurance policy. Other pitfalls logging companies face when it comes to their forestry equipment insurance include:
Ignoring Maintenance Requirements
Logging equipment is large, heavy, and complex. With so many moving parts, it is not unusual for something to go wrong. Getting ahead of the curve with preventive maintenance can stave off the need to leverage your business interruption policy and spare your logging business from costly repairs that may exceed the coverage limit of your equipment insurance.
In addition, staying on top of regular maintenance requirements may offer benefits for insurance coverage. Insurance agencies determine premiums based on numerous factors, one of which is the company’s purported risk—that is, how likely they are to use the coverage and force the insurer to pay. Logging businesses that demonstrate regular maintenance above and beyond the minimum may be deemed less risky and enjoy lower insurance premiums.
Not Updating Policies
Many logging companies search for equipment insurance once and renew their policy yearly without a second thought. While keeping policies current is essential, it does not address the changes that may happen throughout a project.
Changes in equipment and operations may necessitate new coverage, amended policies, and more. Otherwise, your business could be paying for protection for equipment that it is not currently using or neglecting coverage for an essential piece of its current logging process.
Secure Your Forestry Equipment With Burton & Company
Forestry equipment insurance is not a policy to acquire lightly. It can mean the difference between spending nothing on repairs or being on the hook for tens or even hundreds of thousands of dollars when something goes wrong.
Always work with insurance agencies with expertise in the forestry industry to get coverage that works for you. The experts at Burton & Company understand the industry-specific risks associated with logging and offer complete insurance solutions to help clients succeed in the forest.
Our personalized services support logging companies by helping them avoid common pitfalls and maintain the safety and stability of their operations .Contact Burton & Company to learn more about our forestry insurance offerings.
