Inland marine insurance
Inland marine insurance is property coverage for business or personal property that is in transit, mobile, temporarily stored, away from a permanent premises, or held for someone else, such as tools, equipment, materials, cargo and customer property. Payment depends on the policy's covered causes of loss, limit, deductible, valuation and exclusions.
Also called: inland marine, transit insurance, business equipment protection, cargo insurance
When a quote or renewal shows an inland marine line, it is the part of your coverage that follows property once it leaves a fixed spot: tools on a jobsite, goods on a truck, equipment in temporary storage, or a customer's item sitting in your shop. Despite the name, it is not boat insurance; boating transportation falls under ocean marine insurance, according to the California Department of Insurance (opens in a new tab). What it pays comes down to four things on the form: which property is covered, where it is covered, the limit and deductible, and the exclusions and valuation rules.
How an inland marine claim gets paid
Take a contractor who insures mobile construction equipment under an inland marine equipment floater with a $25,000 scheduled limit and a $1,000 deductible. Equipment worth $18,000 is stolen, and no depreciation or coinsurance adjustment applies. The figures are illustrative.
Hover or tap a row to highlight it.
| Step | Amount |
|---|---|
| Covered loss | $18,000 |
| Less the deductible | $1,000 |
| Insurer pays | $17,000 |
| Contractor pays | $1,000 |
The limit caps the payment. If the same theft had been a $30,000 loss with the $25,000 limit still in place, the policy could not pay more than $25,000 before other adjustments, leaving the contractor at least $5,000 above the limit plus the deductible. Valuation, coinsurance, sublimits, exclusions and conditions can reduce a payment further, according to the NAIC glossary (opens in a new tab).
The choices that change what a policy pays
Two inland marine quotes often differ in how property is listed and valued. Scheduled coverage lists specific items and assigns each one a limit, so the payout is generally held to that item's scheduled amount. Blanket coverage puts one limit over several items, locations or categories, so one large loss can use up much of it. Reporting-form coverage is based on values you report periodically, so the payment can depend on how accurate those reports were.
Valuation matters as much as the limit. Replacement-cost valuation can pay the cost to repair or replace covered property, subject to the policy's conditions, while actual-cash-value valuation generally reflects depreciation and may produce a lower payment. Per-item or category sublimits can cap what the policy pays for tools, computers, jewelry, money or business papers.
The form also defines the stage of use it covers. Transit-only, off-premises, mobile-equipment, installation, bailee and temporary-storage coverage each change the covered property, location or moment of risk, per the NAIC glossary (opens in a new tab). Builders risk, which covers buildings under construction along with construction machinery, equipment and incidental materials, is one inland marine class, often written on the anticipated completed value of the project. Cargo coverage overlaps only in part: inland marine includes domestic shipments and motor truck cargo, while goods moving by ocean are commonly insured under ocean marine policies, according to the NAIC Nationwide Inland Marine Definition (opens in a new tab).
Where you see the term
Inland marine shows up in business property insurance, a commercial package policy, businessowners policies, contractors' coverage, equipment floaters, installation floaters, motor truck cargo, bailee coverage and personal articles floaters. It can be a separate policy, a coverage section inside a package, or an endorsement with a schedule of property. On paper, you meet it on a quote, application, binder, declarations page, renewal notice, endorsement, or claim letter. A lender or general contractor may ask for evidence of it alongside a certificate of insurance.
Inland marine is property coverage, not liability coverage. Loss to your own equipment and your responsibility for damage to someone else's property fall under different insuring agreements with separate limits, so a liability policy such as general liability insurance is a separate conversation with your agent. A personal articles floater added to a homeowners or renters policy may be classified as inland marine, and so can pet insurance in some states.
How Connecticut and New York treat inland marine
Connecticut counts as inland marine anything defined that way by statute, by interpretation, by an Insurance Commissioner ruling or by general business custom, and it exempts inland marine from the state's general rating-practice provisions under Conn. Gen. Stat. § 38a-664 (opens in a new tab). Pet insurance is classified as inland marine in Connecticut, according to the Office of Legislative Research (opens in a new tab). For policies within its scope, Conn. Gen. Stat. § 38a-323 (opens in a new tab) requires notice of premium billing at least 30 days before renewal and notice of nonrenewal at least 60 days ahead.
In New York, inland marine covers property connected with transit, transportation, temporary storage, personal property floaters and builders risks, and it excludes vessels, their cargoes and other risks commonly insured only under ocean marine policies, under Insurance Law § 1113(a)(20) (opens in a new tab). Builders risk or installation risk can stay inland marine until occupancy, acceptance or completion, according to DFS Circular Letter No. 22 (opens in a new tab).
Questions to ask an agent or insurer
- Which property is covered, and is it scheduled or under a blanket limit? Scheduled limits, blanket limits, sublimits and valuation rules each change the amount payable.
- Is the property covered in transit, at a jobsite, in temporary storage, in a vehicle, or in a customer's custody? An inland marine label does not mean every location or stage of movement is covered.
- What are the limit, deductible, valuation method, coinsurance requirement and any sublimits? The declarations-page limit may not equal the payment for every loss.
- Are theft, flood, earthquake, vehicle collision, unattended vehicles, mysterious disappearance and employee dishonesty covered or excluded? Covered causes of loss vary by form, and one exclusion can defeat an otherwise fitting claim.
- What documents and deadlines apply to a claim, and what proof of ownership or value do you need? Inventories, serial numbers, invoices, appraisals, shipping records, photos and prompt notice can all affect how a claim is adjusted.
Frequently asked questions
Three questions come up often.
Does inland marine insurance cover boats?
Not by default. Vessels and ocean transportation are commonly covered by ocean marine insurance, and New York's definition expressly leaves out vessels and their cargoes. State classifications have their own exceptions, so check the policy form and the state where the risk sits.
Is inland marine insurance only for trucking companies?
No. Contractors, repair businesses, jewelers, photographers, medical-equipment users, businesses holding customer property, and anyone with mobile or high-value equipment may use inland marine forms, according to the Connecticut Insurance Department (opens in a new tab). Our inland marine insurance guide covers how businesses use it.
Does a businessowners policy cover equipment away from my business?
It may provide some coverage, depending on its property definitions, covered locations, exclusions and endorsements. Mobile equipment, property in transit and property at jobsites may need inland marine coverage, according to the California Department of Insurance (opens in a new tab).