Commercial Marine Projects Can Create Inland Marine Insurance Gaps

Active marine projects have a lot of moving parts, which can mean that commercial marine programs — and specifically, inland marine insurance — quickly become outdated.

Think about it: Equipment moves between job sites, docks, storage yards, staging areas, and contractor facilities throughout the life of a job. The value of what’s in motion at any given moment can be considerable. The more an asset moves and the more places it sits temporarily, the more important it is to confirm that inland marine coverage keeps pace with the project.

What Does Inland Marine Insurance Cover?

In short, it protects property while it is in transit over land or temporarily stored or in someone else’s care.

According to the Insurance Information Institute, collisions and cargo theft are the two most frequent causes of inland marine losses, and both can easily occur on active marine construction and infrastructure projects. Theft from unsecured staging areas, damage during loading or unloading, and losses tied to project delays can all leave equipment exposed and make a marina underinsured. 

You can save the day, however, if a theft or other loss occurs. Acting as a proactive advisor, rather than taking a panicked call from a client, is how an agent earns the trust and loyalty that can accompany these accounts.

Where Is Marine Equipment Most Vulnerable During Active Projects?

Temporary storage is where many inland marine losses originate. Picture a staging area set up at the edge of a project, an unfenced laydown yard along a riverbank, or a leased lot used for overnight equipment parking.

Those scenarios can all create exposures that didn’t exist when the same equipment sat behind a locked gate at the contractor’s main yard. Specialized marine equipment is also more recognizable and easier to resell than generic construction gear, making it a target for thieves.

The most commonly affected items are familiar to anyone who has walked a marine job site. You name it, and there’s a good chance it’s wound up in a claim: trailers, generators, dewatering pumps, compressors, welders, dive support gear, survey equipment, hand tools, and the specialty rigging that marine contractors rely on.

When a project hits a weather delay, a permit pause, or a supply-chain hiccup, that equipment can sit on-site for days or weeks longer than originally planned, and the exposure window opens up even more.

Equipment Movement and Coverage Gaps

A typical marine project rarely uses equipment in one spot. Pieces move between the contractor’s yard, a primary work site, a secondary work site, a dockside staging area, and a rental return facility, often multiple times over the course of a job. 

Each of those transitions can be a potential loss event. Transit-related collisions, drops during loading or unloading, items not properly secured to a trailer, and incidents at third-party storage locations can all lead to claims that may not be fully covered without inland marine insurance.

Documentation also tends to slip when equipment is moving frequently. Schedules of insured property go out of date, new pieces of equipment are added without being reported, and rental items pass through without being added to a floater. Certain times of the year, like the spring, can also be very busy and invite possible trouble.

Higher Equipment Values Can Change Inland Marine Needs

Replacement costs for marine and construction equipment have climbed in recent years. Inland marine schedules set against older valuations are almost certainly out of step with the cost of replacing gear today.

Rental and leased machinery can also complicate insurance. If your marina client has a lot of equipment they are renting at the marina, they may not be fully insured. If they’re building onto the marina and have newly purchased equipment, that, too, can quickly lead to being underinsured.

How To Help Marine Contractors Reduce Inland Marine Risks

Talk to your clients. That’s really the secret to helping marine contractors reduce inland marine risks. Schedule a meeting to review how and where equipment is stored, transported, and tracked.

Once you discuss inventory management, security measures and subcontract responsibilities — and they start to see just how underinsured they are — they’ll thank you. And scheduling the next meeting should be even easier.

Meanwhile, if you’re looking for commercial marine programs and inland marine insurance solutions, be sure to contact Merrimac Marine Insurance. We’re standing by, ready to help.

About Merrimac Marine Insurance

At Merrimac Marine, we are dedicated to providing insurance for the marine industry to protect your clients’ businesses and assets. For more information about our products and programs, contact our specialists today at (800) 681-1998.