Builders Risk vs Contractors’ Equipment: Which Insurance Protects HVAC Materials on a Jobsite?

When you're an HVAC contractor working on projects in the United States — whether installing rooftop units in Houston, retrofitting commercial systems in Los Angeles, or staging equipment for a multifamily build in Chicago — protecting HVAC materials and temporary equipment on the jobsite is critical. Two common policies intersect here: Builders Risk and Contractors' Equipment (Inland Marine / Tool & Equipment). This guide explains which policy covers what, typical costs, endorsements you should request, and practical steps to make sure HVAC materials are insured correctly on U.S. construction sites.

Table of Contents

Quick answer

Builders Risk primarily protects property that is part of the construction project (materials, fixtures, and installed systems) from perils such as fire, theft, wind, vandalism, and some soft-cost losses while the project is under construction.
Contractors' Equipment (also called inland marine, owned equipment, or tool insurance) protects portable tools, rigging, and contractors’ owned equipment (e.g., lifts, forklifts, HVAC diagnostic tools, and temporarily staged HVAC units) from loss or damage, and typically includes site-to-site transit coverage.

Read on for details, examples, and how to avoid the coverage gaps that commonly affect HVAC contractors.

What builders risk covers (for HVAC work)

Builders risk is typically purchased for the project owner or general contractor and covers the project while under construction. For HVAC work, builders risk usually covers:

Materials and equipment intended to become a permanent part of the building (e.g., ductwork, rooftop packaged units, built-in rooftop curbs) while on the jobsite or in transit to the site (if endorsed).
Installed systems once they become part of the structure (subject to policy terms and exclusions).
Specified soft costs, debris removal, and delay costs if added.

Typical premium: 0.5%–4% of the total completed value of the project (varies by location, project type, duration, and insurer). For example, a $1,000,000 project might see builders risk premium ranges roughly $5,000–$40,000 annually depending on risk factors and deductibles (see sources from Nationwide and The Hartford). Nationwide Builders Risk, The Hartford Builders Risk

What contractors' equipment covers (for HVAC work)

Contractors' equipment (often an inland marine or property floater) protects the contractor’s owned and leased equipment and tools:

Portable HVAC testing devices, hand tools, portable lifts, scaffoldings, and temporarily staged HVAC units that remain contractor property.
Transit and site-to-site exposures (with endorsements).
Often covers theft, accidental physical damage, and collision for equipment on trailers.

Typical premium: 1%–6% of scheduled equipment value per year, depending heavily on equipment class, theft risk, and deductible. For example, insuring $100,000 of portable HVAC tools and rental units could cost roughly $1,000–$6,000/year (Insureon and market sources for small contractors provide ranges). Insureon Contractors Equipment

Side-by-side comparison

Feature	Builders Risk	Contractors' Equipment
Primary insured	Owner or GC (can add subs as additional insured)	Contractor (equipment owner)
Typical exposures covered	Materials and systems that will become part of structure	Portable tools, rental equipment, and owned construction equipment
Transit/site-to-site	Often needs endorsement to include transit or off-site storage	Often includes transit/site-to-site (confirm limits)
Typical premium (U.S. avg range)	0.5%–4% of completed value	1%–6% of scheduled equipment value
Best for HVAC	Protecting installed HVAC components and materials intended to be permanent	Protecting contractor-owned HVAC tools, rigging, lifts, and temporary units
Example claim	Fire damages installed ductwork and rooftop condenser	Theft of trailer with HVAC tools and portable compressors

Common real-world scenarios (by city/state)

Houston, TX (hurricane and theft risk): Builders risk premiums may be higher due to wind/hurricane exposures; add wind/hail coverage and confirm deductibles. Contractors' equipment should include theft and transit; consider higher deductibles but robust sublimit for tools.
Los Angeles, CA (jobsite theft, limited earthquake coverage): Builders risk often excludes earthquake — consider separate earthquake coverage or endorsements. Contractors should ensure off-site storage and transit coverage because street thefts are common.
Miami/Fort Lauderdale, FL (hurricane-prone): Expect wind/hurricane deductibles and possibly surge exclusions on builders risk; contractors’ equipment schedules should include inland marine or specialized flood endorsements for coastal jobs.

How HVAC materials can fall through coverage cracks

A new rooftop HVAC unit staged on-site but still owned by the HVAC subcontractor may be excluded from the owner’s builders risk because it’s not project property yet — and simultaneously excluded from the subcontractor’s equipment policy if it isn’t scheduled or if the policy excludes equipment left overnight. That leads to a gap.
Transit coverage may not be automatic on builders risk — and contractors' equipment policies may exclude theft from unattended vehicles unless locked and secured.

To avoid gaps:

Coordinate coverage in writing between the GC, owner, and subcontractor.
Add HVAC subcontractors as additional insureds or schedule their equipment on the builders risk when the owner intends to take title upon delivery.
Maintain a scheduled list and site-to-site coverage on contractors’ equipment policies.

For coordination best practices, see: Coordinating Coverage Between GC, Subcontractor and Owner Policies for HVAC Work

Endorsements and options HVAC contractors should request

Installation floater or "installation coverage" endorsement on builders risk (covers materials intended for installation while in transit and during installation).
Site-to-site and transit endorsements on contractors' equipment policies for temporary HVAC units and rigging.
Coverage for rental equipment and leased items on the contractors’ equipment policy.
Soft costs and delay in start-up endorsements on builders risk if project timeline impacts revenue. See: Soft Costs, Delay and Debris Removal: Builders Risk Considerations for HVAC Subcontractors

Also review how HVAC equipment is added to builders risk: How to Add HVAC Equipment to a Builders Risk Policy During Installation

Practical checklist for HVAC contractors (USA-focused)

Confirm who will own the HVAC materials at delivery (owner, GC, or subcontractor).
Require written proof of builders risk limits and endorsements covering HVAC materials if owner/GC intends to insure.
Schedule high-value HVAC units and expensive specialty tools on your contractors’ equipment policy.
Get transit and site-to-site coverage and confirm theft from unattended vehicles is covered.
Keep invoices, serial numbers, and photos to support valuation and claims.

Insurers and price expectations

Major carriers that offer these products in the U.S. market include:

The Hartford — known for contractor packages and builders risk (builders risk info): https://www.thehartford.com/business-insurance/contractor-insurance/builders-risk-insurance
Nationwide — builders risk and commercial property solutions with regional underwriting: https://www.nationwide.com/business/insurance/builders-risk
Regional/market options and brokers (Zurich, CNA, Travelers) also provide tailored contractors’ equipment/inland marine options.

Estimated premium examples (U.S., subject to underwriting):

Builders Risk: For a $1,000,000 commercial renovation in Chicago, builders risk may run $5,000–$25,000 depending on timeframe, wind/hail exposure, and soft-cost endorsements. [Nationwide], [The Hartford]
Contractors' Equipment: Insuring $100,000 of tools and portable HVAC rental equipment might cost $1,000–$6,000/year depending on theft risk, transit exposure, and deductible. [Insureon]

Sources: Nationwide, The Hartford, Insureon:

Valuation and claims: what HVAC contractors must document

Maintain purchase invoices, serial numbers, photos of equipment and storage methods.
Agree in advance on valuation method (replacement cost vs. actual cash value) with the insurer — see: Valuation Methods and Settlement Options for Damaged HVAC Project Materials
For large projects, confirm project-specific certificate and scheduling requirements before mobilization: Certificate and Project Requirements for HVAC Insurers on Construction Sites

Bottom line

Use builders risk for materials and installations that will become part of the building (and ensure the correct endorsements for transit/soft costs).
Use contractors' equipment for contractor-owned tools, units, and portable equipment, with site-to-site and transit coverage.
Coordinate policies, schedule high-value HVAC units appropriately, and request endorsements to close common gaps — especially in high-risk U.S. markets like Houston, Miami, and Los Angeles.