Central Insurance Blog

When it comes to protecting tools, equipment, and materials, contractors and builders often hear two types of insurance coverage mentioned: inland marine and installation floater. While they might sound similar—or confusingly technical—understanding the distinction is crucial to ensuring your property is adequately covered before, during, and after a job.

This article will delve further into the differences between inland marine and installation floater coverage with expert guidance from Thomas McMillan, commercial lines staff underwriter at Central Insurance.

What is Inland Marine Insurance?

Despite the name, Inland Marine has nothing to do with watercraft. Instead, it evolved from ocean marine coverage and now refers to insurance for property that moves over land. That includes tools, equipment, and high-value items not tied to a specific location.

“Inland marine is typically going to cover property in transit over land, or movable/specialized property,” McMillan explains. “It’s commonly used for tools, equipment, fine arts—items not confined to one place.”

For Example: A landscaping company hauling mowers and tools from one job site to another would rely on inland marine coverage to protect that property in transit.

What is an Installation Floater?

An installation floater, on the other hand, is designed to cover materials, equipment, or supplies while they’re at a jobsite and waiting to be installed.

“Most of the time when we say ‘installation floater,’ we’re talking about materials being installed at a specific jobsite,” McMillan states. “It’s usually particular to a project and not something that travels from site to site like tools might.”

So if a contractor is installing an HVAC system in a new building, those units, while staged on-site, would be protected by an installation floater until they’re permanently installed and become part of the building’s structure.

Learn More: Contractor Insurance: Seven Policies You Need to Protect Your Business

Why Knowing the Difference Between Inland Marine and Installation Floater Matters

One of the biggest reasons for understanding the difference between an inland marine and an installation floater is to avoid overinsuring or underinsuring. 

“You normally wouldn’t cover one piece of equipment with both types of coverage,” McMillan points out.

For example, if a plumber’s copper piping is delivered to a construction site for installation, an installation floater would be the appropriate coverage. However, the pipe-cutting tools that the plumber uses regularly on each job would typically be covered under an inland marine policy.

Not knowing the distinction can lead to gaps in coverage–or wasted premium dollars. That’s why it’s important to discuss all facets of your operations with your independent Central agent, who can help you protect your business best.

Common Misconceptions of Inland Marine and Installation Floater

According to McMillan, one of the biggest misunderstandings is that standard commercial property insurance covers tools and materials no matter where they are. 

He also shares that many people assume inland marine coverage has something to do with boats. “There’s a whole history behind the name, but today, it’s about land-based property movement, not marine activity.”

How to Navigate Inland Marine and Installation Floater Insurance

McMillan recommends a regular review of your tools and coverage with your agent, especially as your business grows or shifts focus.

“Inland marine is often the Wild West of insurance coverage,” McMillan mentions. “It’s frequently unfiled, meaning states don’t have direct oversight, and carriers may use non-standard forms. That’s why agents need to be familiar with the specific language and go through it line by line with the insured.”

He also advises contractors to closely review policy exclusions with their agent, especially for tools and materials stored off-site or in transit. Inland marine coverage can vary significantly between carriers, so it’s important to understand exactly what is and isn’t covered.

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Inland Marine and Installation Floater Coverage Trends in the Field

One industry trend influencing coverage decisions is the rise of modular construction and off-site fabrication. These approaches increase efficiency but can complicate insurance because the building materials are often fabricated away from a company’s main facility.

McMillan highlights that these materials may require inland marine coverage because they aren’t stored at a location the insured owns, leases, or occupies. As this type of construction becomes more common, it reinforces the importance of reviewing project logistics with your insurance agent to determine which policies best apply.

Choose a Carrier With Proven Construction Industry Experience

Central Insurance understands the nuances of construction insurance—and that’s reflected in both its coverages and customer service. Central offers broad coverage forms and competitive rates in the inland marine space, with a highly sought-after Builder’s Risk product.

The company also brings value through underwriting specialization. “We’ve built expertise in this space to ensure our coverages are appropriate for the insured’s needs,” McMillan says. “Our underwriters even review contracts to help agents identify when additional coverage is needed. That kind of proactive approach makes a big difference.”

Central’s commitment to the construction industry goes beyond offering policies—it focuses on being a true partner to contractors. With more than 150 years of experience, it understands the fast-paced and high-risk nature of the industry. That’s why Central pairs specialized construction coverage with a proactive, team-based approach that includes expert underwriting, risk control, and responsive claims handling. Reach out to your local independent Central agent to ensure you have the right inland marine or installation floater coverage before work begins or to learn more about an insurance quote.