What do Equipment Rental Damage Waivers Insure Anyway?

When renting heavy equipment, you're entering into an agreement with a company trying to profit by lending out tools too expensive for most small companies and homeowners to purchase. In order to make the business model profitable, the lending companies need to protect their investments because there's always a chance that a backhoe or trench cutter will come back so damaged it needs repair or replacement. Damage waivers are a way for companies to protect their assets, but they're not as iron-clad as many renters believe. Find out about the benefits and disadvantages of rental damage waivers and what else is available for protecting you during the rental.

A Basic Contract

First, keep in mind that a damage waiver is a standard and basic contract used by rental companies. It's an agreement stating that the company will not hold you responsible for paying for certain types of damages. All damage done outside the scope of the contract is still your liability, no matter how much you've paid for the damage waiver fee. Also, most waivers also stipulate a specific deductible you have to pay before the coverage kicks in. This could stretch into thousands of dollars, leaving you a lot less protected than you might think. The contract can say almost anything, so make sure to read all damage waivers before signing them or find another way to protect yourself from damage charges.

Expensive Fees

Aside from including or excluding any type of damage at will, the damage waiver usually comes with a healthy fee alongside it. Most companies charge between 10% and 15% of the total rental amount to cover the costs of potential repairs. While it's often advertised as a form of insurance for the rental, it's technically not considered an insurance plan. Waivers are legal contracts, not insurance plans, and they're judged by a different set of laws if a dispute with a rental company goes to court.

Uneven Coverage

One of the biggest issues with rental damage waivers is the fact that no two contacts cover the exact same details. For example, you may rent a skid steer from Company A and sign a waiver stating that you'll still pay for any vandalism damage out of your own pocket. A week later you rent a trencher from Company B, then agree to pay for natural disaster damage while being protected against the efforts of vandals or thieves. Reading all the fine print on dozens of different contracts takes a lot of time away from managing the job site or completing the project. Instead of struggling to keep the details separate for the various rental companies, let Getable handle those details for you.

Alternatives to Waivers

The best option for avoiding the hassle of waivers is to use an insurance policy to cover the equipment instead. Don't assume your homeowner's insurance policy or business general liability policy will automatically cover your rental. Unless specifically stated otherwise, most of these policies only cover items purchased by the business or home owner. You can take out an umbrella policy rider with your current insurer, which is a separate policy added to your usual plan that offers a specific amount of financial protection on the equipment you rent, regardless of what damages it.

The rental companies will be happy to skip the damage waivers they usually require as long as you can prove you have other ways of insuring the equipment. You'll enjoy a lot more peace of mind with insurance over a damage waiver, but make sure you pick at least one of the two instead of going without any backup plans in case of damage.