If you work in a trade, your tools are how you earn a living. Whether you’re a plumber, electrician, gardener or any other kind of tradesperson, having your equipment stolen can bring work to a standstill, just when you need the money most to replace it. Insurance should help here; that’s what it’s designed for.
But making a successful claim isn’t always straightforward, and many people find their safety net is riddled with holes. One of the biggest is proof: almost six in ten tradespeople whose main worry is lost income have no proof they own their tools at all, which leaves them exposed the moment an insurer asks them to show what was taken.
The problem of proving what you own
There are a lot of different reasons why tool theft claims can be so difficult to successfully manage. But one of the biggest obstacles is proving that stolen equipment belonged to you in the first place. Research suggests that around 83% of tradespeople don’t have readily available proof of ownership for their tools. And without receipts, invoices, serial numbers or photographs, providing the evidence an insurer needs can be next to impossible.
The problem is that very few tradespeople buy all their equipment at once. Tools are gradually collected through the years, and they come from various sources. Some new, some second-hand, others gifted or passed down through family. Keeping every receipt from every purchase is standard practice, but when they’re filed away in tax returns, they can be impossible to find. And taking photos of tools often doesn’t even occur – until it becomes necessary to provide evidence for a claim, by which point it’s too late.
It’s terribly stressful, and the financial pressure makes matters worse. In our recent research, 59.4% of tradespeople who identified lost income as their main concern following theft (19 out of 32 respondents) said they had no proof of ownership at all. And that makes an insurance payout unlikely.
When your cover no longer adds up
Even with evidence of ownership, there’s no guarantee that you’ll receive what you’re due if you haven’t looked closely at the details. Underinsurance is worryingly common, because it’s so easy to do. When you add tools as you need them, whether upgrading worn-out equipment or buying specialist tools for a specific job, the value of your kit increases incrementally.
But few people remember to update the value in their insurance policy. And if your policy covers less than the current cost of replacing your tools, you could face a significant gap after a theft. Depending on the policy’s terms, proportional settlement may also reduce the payout further when you’ve insured your equipment for less than its actual value.
This is why insurance renewal deserves more attention than simply accepting another year’s cover. Every time that letter arrives, you need to review your inventory, check today’s replacement prices, and make sure your declared value reflects what you own.
What happens when you underinsure
Tim Davidson, a gardener from Herefordshire, had his van broken into overnight. Around £7,000 worth of tools were stolen. Four years earlier, when Tim took out his insurance policy, his declared tool value was £4,000. Although he renewed the policy annually, he hadn’t reassessed the value of his equipment.
Tim’s tool collection had grown in the intervening years. He had a receipt for his new mower and a pair of loppers, but other tools had come from a friend leaving the trade. He’d also been gifted some bits by his parents, and picked up a couple of second-hand tools from Facebook Marketplace and had no real receipts.
With his insurance limit well below the cost of replacing everything, proportional settlement further reduced the amount he received. The resulting payout covered only a small part of the expense of getting his business properly equipped again. He nearly gave up entirely. Showing that having insurance doesn’t automatically mean you’ll receive enough money to replace what’s been stolen.
Build an inventory that works for you
The thing that many people don’t realise is that documenting your equipment doesn’t have to be complicated or time-consuming. A simple spreadsheet or Word document can be enough to track your inventory. You just need to keep it regularly updated, with item details, including serial number, purchase dates and prices, the current cost of buying a replacement, a photograph of the item, and any proof of purchase. For expensive equipment, servicing records, and maintenance documents can also be useful.
Just make sure that you store your records somewhere separate from your tools, so that it’s not taken if they are.
Use technology
Spreadsheets are a great starting point, but as your business grows, dedicated asset-management software can be a better idea, because it helps you bring everything together more easily, so your inventory is easier to maintain. Depending on the platform and equipment involved, some solutions also offer location tracking, movement alerts, or remote disabling features. They won’t prevent theft, but they can make it easier to retrieve your goods if they are stolen.
Be prepared
Insurance is an important safety net, but it only works if you do your bit too. And that means reading your policy, understanding security conditions, and following any requirements concerning tools left in vehicles overnight. As well as reviewing your cover regularly and keeping a reliable record of your equipment.
Tool theft happens far too often. And it can be devastating for tradespeople who depend on their kit every day. Spending ten minutes each month updating your inventory is a small commitment compared with the disruption, expense and uncertainty that theft can bring. You can’t eliminate every risk, but you can make sure you’re better prepared if the worst happens.
Pictured is Paul Harvey, Operations Director at Kynekt, an equipment protection and theft deterrent platform built for the construction sector.
