Overview
Machinery or equipment erection contractors move, set, anchor, and align heavy industrial equipment such as presses, turbines, conveyors, packaging lines, generators, and process machinery inside factories, power plants, and warehouses. The work combines rigging, hoisting, leveling, and precision alignment, frequently inside operating facilities where the contractor handles equipment worth far more than the installation contract. Crews use cranes, gantries, jacks, skates, and forklifts to position loads through tight spaces, then connect, calibrate, and commission systems. Because a single piece of machinery can be enormously valuable, this trade's exposure is dominated by care, custody, and control of others' property.
Part of our construction & contractors insurance guidance.
Risk profile
The defining risk for erection contractors is damage to expensive machinery during lifting, moving, and setting, when a slipped rigging point, dropped load, or alignment error can destroy equipment and halt a client's production. Working inside active plants raises the stakes: an incident can damage the building, adjacent equipment, or product lines and cause costly downtime. Rigging and heavy lifting expose workers to crush, struck-by, and pinch injuries, while owned cranes, jacks, and tooling carry their own loss exposure. Faulty installation or commissioning can lead to equipment failures, and complex projects can prompt contract and bonding requirements from industrial clients.
Common risks
Damage to machinery in your care
Rigging, hoisting, and setting high-value equipment creates care, custody, and control exposure if a load is dropped or mishandled.
Client production downtime
An incident inside an operating plant can halt a client's production line, leading to large business-interruption and consequential claims.
Damage to facility and adjacent equipment
Moving heavy loads through tight spaces can strike walls, floors, utilities, or neighboring machines at the customer site.
Rigging and lifting injuries
Workers handling chains, slings, jacks, and skates face crush, struck-by, and pinch injuries during heavy lifts.
Faulty installation or commissioning
Misalignment or improper connection can cause equipment to fail after startup, prompting rework and liability claims.
Owned rigging gear and tooling loss
Gantries, jacks, slings, skates, and precision tools can be damaged or stolen in transit and at job sites.
Recommended coverages
Coverages commonly relevant to machinery or equipment erection contractor operations. Not every business needs the same policies.
Operational Coverage
Employee-Related Coverage
Contractual Coverage
Why tailored insurance matters
Machinery erection is unusual because the contractor routinely takes custody of property worth many times the job's value, and a single lift can decide the firm's year. Standard contractor liability often limits or excludes damage to property in the contractor's care, so installation-floater and rigging coverage are central rather than optional. A program coordinating liability, inland marine, workers' compensation, and excess limits may help align protection with the real value at risk during each lift, subject to policy terms. Coverage availability depends on underwriting, rigging practices, and loss history.
Hypothetical claim examples
Dropped press during a lift
A rigging point fails and a press is damaged while being set in a plant. An installation floater under inland marine may respond, depending on policy terms, limits, and exclusions.
Struck adjacent equipment
While maneuvering a load, a crew strikes a neighboring machine and damages it. General liability may respond to the third-party damage, subject to the specific policy and facts.
Rigger injured on a heavy lift
A worker's hand is crushed during a setting operation. Workers' compensation may respond to medical and wage costs, subject to applicable state requirements.
Hypothetical scenarios for illustration only. Coverage depends on the specific policy, endorsements, exclusions, and facts of each claim.
What affects insurance cost
- Annual revenue and number of rigging crews
- Value of machinery typically handled
- Use of owned cranes, gantries, and jacks
- Work inside operating versus idle facilities
- Care, custody, and control limits needed
- Rigging safety record and claims history
How much does it cost?
There is no single price for machinery or equipment erection contractor insurance — it depends on which of these coverages you carry and the specifics of your business. As a rough guide, here are general national averages for the coverages this business commonly needs.
- $500–$1,500 per year for many small businesses
- $300–$1,000 per year for many small businesses
- $500–$3,000 per year, driven largely by payroll and job class codes
- $1,500–$3,000 per vehicle per year
- $400–$1,500 per year per $1M of additional limit
- 1%–3% of the bond amount per year for many qualified businesses
These are general national averages shown for comparison only — not a quote. Actual premiums vary widely with underwriting and depend on the factors above and the specifics of your business, including size, revenue, location, claims history, and the limits you choose. See how we estimate costs.
Coverage considerations
- Set adequate installation-floater and rigging limits
- Review care, custody, and control terms carefully
- Confirm coverage for damage to client equipment
- Evaluate downtime and consequential-loss exposure
- Schedule owned cranes and tooling on inland marine
Common underwriting considerations
When insurers review a machinery or equipment erection contractor business, they commonly evaluate factors like these. This is educational information — nothing here is collected or submitted.
- Trades performed and the share of higher-risk work such as roofing or structural
- Annual revenue, payroll, and typical project size
- Use of subcontractors and the certificates and agreements collected from them
- Years in business, licensing, and claims history
- Heights worked, depths excavated, and safety programs in place
- Vehicle and equipment fleets and who operates them
Common contractual insurance requirements
Contracts, leases, and licenses in this industry commonly impose insurance requirements such as these. Always review the specific wording in your own agreements.
- Construction contracts routinely require additional-insured status, primary-and-noncontributory wording, and waivers of subrogation
- Project owners and GCs set minimum general liability, auto, and umbrella limits
- Completed-operations coverage is commonly required for years after project close-out
- Public work frequently requires bid, performance, and payment bonds
- Certificates of insurance are required before mobilizing on nearly every job
Common coverage mistakes
Mistakes businesses in this industry commonly make when arranging coverage — worth reviewing before you buy or renew.
- Starting work before contract insurance requirements are met
- Using uninsured subcontractors and absorbing their losses at audit or claim time
- Assuming tools and equipment are covered away from the shop without inland marine
- Overlooking completed-operations exposure after a project is finished
- Misclassifying payroll and facing large premium-audit adjustments
Frequently asked questions
What is an installation floater and why does it matter here?
It is inland marine coverage for equipment a contractor is installing or has in its care. For erection work, it may respond to damage to high-value machinery, subject to policy terms.
Does general liability cover machinery in my custody?
Often only partially. Many policies limit care, custody, and control exposure, so an installation floater is commonly added. Coverage depends on the specific policy and endorsements.
Why is umbrella coverage important for this trade?
A dropped load can cause damage and downtime far exceeding primary limits, so excess liability is often advisable. The right limit depends on equipment values and underwriting.
Are my cranes and rigging gear covered in transit?
Owned cranes, gantries, and rigging tools are commonly scheduled on inland marine, which may cover them in transit and at sites, subject to listed limits and policy terms.
Do industrial clients require bonds?
Larger erection contracts sometimes require performance and payment bonds. Surety capacity depends on the contractor's financials and experience and is subject to underwriting.
What if equipment fails after I commission it?
Allegations of faulty installation or alignment may involve liability and completed-operations coverage. Response depends on the policy, endorsements, exclusions, and the facts.
How do I get a quote?
Call The Southern Agency at 1-800-777-1872 or request a quote online for guidance tailored to your machinery or equipment erection contractor business.