Inland Marine Insurance

Overview

Inland marine insurance covers property that is mobile or in transit over land, as well as specialized equipment and goods stored at locations other than the insured's main premises. Despite its nautical name — inherited from ocean marine insurance — inland marine has nothing to do with water. It evolved to cover the growing need to insure property that traditional property policies excluded because the items were not at a fixed location.

How It Works

Inland marine policies protect a wide range of movable property, including:

• Contractors' tools and equipment: Power tools, scaffolding, heavy machinery transported between job sites
• Materials in transit: Building materials, fixtures, and supplies being delivered to a project
• Installation floaters: Property being installed at a job site until installation is complete
• Electronic data processing (EDP) equipment: Computers, servers, and networking gear in transit or at temporary locations
• Fine arts and valuable papers: Specialized items that move between locations

The coverage typically applies on an "all-risk" basis (now called "special form"), meaning it covers any cause of loss not specifically excluded. Common exclusions include wear and tear, gradual deterioration, and inherent defect.

Inland marine policies can be written as standalone policies or as endorsements to a broader property program. Coverage can be structured on a blanket basis (covering all eligible property up to a limit) or on a scheduled basis (listing specific items and their values).

Compliance Relevance

Inland marine insurance is frequently required in construction, logistics, and technology contracts. For COI compliance:

• Contractors: Property owners and GCs may require subcontractors to carry inland marine coverage for their tools and equipment to avoid disputes over damaged or stolen items on the job site
• Installation work: When a vendor is installing expensive materials or equipment, an installation floater (a type of inland marine coverage) protects the property during the installation process
• Transit exposure: If a vendor is transporting valuable goods, the certificate holder may require proof of inland marine coverage to ensure the goods are protected during delivery
• Limit verification: Compliance teams should verify that inland marine limits are adequate to cover the value of property at risk on the project

Inland marine coverage does not appear on the standard ACORD 25 form. It is typically evidenced on an ACORD 28 (Evidence of Property Insurance) or in the Description of Operations section of the ACORD 25.