How to Calculate Insurance Costs for Plant Hire Shops

CALL FOR EXPERT ADVICE
GET A QUOTE NOW

A practical guide to understanding plant hire insurance pricing, premiums and cost drivers

CALL FOR EXPERT ADVICE
GET A QUOTE NOW

We compare quotes from leading insurers

  • Allianz
  • Aviva
  • QBE
  • RSA
  • Zurich
  • NIG

UNDERSTANDING PLANT HIRE INSURANCE COSTS

Why Insurance Costs Vary So Widely

Plant hire insurance pricing can vary significantly between businesses that look similar on the surface. That’s because insurers rate risk based on how your hire operation actually works - not just the headline value of your equipment.

Understanding how premiums are calculated helps you avoid underinsurance, spot false economies, and make informed decisions about excesses, limits and cover extensions.

The Core Factors That Determine Cost

Insurers assess a combination of asset value, exposure, loss frequency and operational controls. Each factor contributes to the final premium you’re quoted.

  • Total hire stock value (average and peak)
  • Highest single item value
  • Type of equipment hired (theft and damage risk)
  • Claims history and loss frequency
  • Depot, yard and van security arrangements
  • Hire duration and turnover rate
  • Customer mix (DIY vs trade vs site services)
  • Public and employers’ liability limits
CALL FOR EXPERT ADVICE
GET A QUOTE NOW

Hire Stock Value & How Insurers Look at It

One of the most common pricing mistakes is insuring at the wrong value. Insurers typically look at both your average hire stock value and your peak exposure.

If you insure permanently at peak values, you may overpay. If you insure at average values without uplift, you risk underinsurance at claim time.

Average vs Peak Values

  • Average value: normal trading conditions
  • Peak value: seasonal or project-driven spikes
  • Seasonal uplift options to control cost
  • Declared value accuracy affects claims settlement
  • Regular reviews help prevent drift

Highest Single Item

  • Sets sub-limits and excess expectations
  • Higher values increase theft and damage exposure
  • Often triggers additional security requirements
  • Critical for specialist or newer equipment
CALL FOR EXPERT ADVICE
GET A QUOTE NOW

Claims History & Its Impact on Premium

Frequency matters more than severity in many plant hire portfolios. Multiple small losses can drive pricing up faster than a single major claim.

  • Repeated thefts signal control issues
  • High accidental damage frequency increases excesses
  • Poor documentation complicates settlements
  • Improved processes can stabilise premiums
  • Insurers reward demonstrable risk management
CALL FOR EXPERT ADVICE
GET A QUOTE NOW

FREQUENTLY ASKED QUESTIONS

+-

+-

What is the biggest driver of plant hire insurance cost?

Hire stock value and claims history are usually the biggest factors, followed closely by security arrangements and customer mix.

+-

Can I reduce premiums without reducing cover?

Yes. Options include adjusting excesses, improving security, using seasonal uplifts instead of permanent values, and tightening hire controls.

+-

Does higher liability cover always cost much more?

Not always. Liability limits often add relatively modest cost compared to asset cover, especially when risk management is strong.

+-

How often should I review my insured values?

At least annually, and whenever you significantly expand your fleet, add higher-value equipment or enter new hire markets.

+-

Is cheapest cover always the best option?

No. Underinsurance, unsuitable excesses and missing extensions can make cheaper policies far more expensive when claims arise.

Related Blogs