Dry hire damage waiver insurance, or Dry hire extension is a specialised form of coverage that provides protection for businesses and individuals renting out equipment, machinery, or vehicles without an operator or driver. Whether you’re a construction company renting out heavy machinery, an event planner renting audiovisual equipment, or a homeowner renting out a lawnmower, dry hire damage waiver insurance can be a valuable asset. Let’s delve into the key aspects and benefits of this insurance.
What is Dry Hire Damage Waiver Insurance?
Dry hire damage waiver insurance, often referred to as “damage waiver” or “dry hire extension,” is designed to protect the owner of rented equipment from financial losses due to damage, theft, or loss of the equipment during the rental period. It can apply to various types of equipment, including:
- Construction machinery (e.g., excavators, bulldozers)
- Tools and equipment (e.g., power tools, generators)
- Audiovisual equipment (e.g., cameras, projectors)
- Party and event equipment (e.g., tents, chairs)
- Vehicles (e.g., cars, trucks)
How Dry Hire Damage Waiver Insurance Works
Here’s how dry hire damage waiver insurance typically operates:
- Rental Agreement: The owner and renter sign a rental agreement that includes the terms and conditions of the rental, including the cost of the damage waiver insurance.
- Damage Waiver Fee: The renter pays a fee for the damage waiver insurance, often calculated as a percentage of the rental cost (10-15%).
- Coverage: During the rental period, the equipment is covered by the insurance policy. This coverage typically includes damage due to accidents, theft, vandalism, and other covered perils.
- Reporting Incidents: In the event of damage, loss, or theft, the renter must report the incident to the owner and, if required, to the insurance provider, following the procedures outlined in the rental agreement.
- Coverage Limits: The insurance policy may have coverage limits and deductibles. The renter may be responsible for any costs that exceed these limits or deductibles.
Benefits of Dry Hire Damage Waiver Insurance
1. Risk Mitigation:
- Owners of rental equipment can mitigate the financial risks associated with damage or loss of their assets during rentals.
2. Simplified Claims Process:
- Dry hire damage waiver insurance often streamlines the claims process, making it easier for both the owner and the renter to resolve issues.
3. Enhanced Business Opportunities:
- Rental businesses can attract more customers by offering damage waiver insurance, as it provides peace of mind to renters.
4. Preserving Business Relationships:
- Damage waiver insurance can help maintain positive relationships between equipment owners and renters, reducing disputes over liability.
Considerations for Dry Hire Damage Waiver Insurance
- Policy Terms: Review the terms and conditions of the insurance policy carefully, including coverage limits, deductibles, and exclusions. Ensure Damage Waiver Insurance Cover is added to the policy, commonly referred to as Dry Hire Extension.
- Documentation: Maintain proper documentation of the equipment’s condition before and after each rental to facilitate claims processing.
- Education: Educate renters about the benefits and limitations of the damage waiver insurance to ensure they understand their responsibilities.
- Excess: Businesses will commonly ask renters to pay for the excess if a claim is required, this way the hirer can subsidise some of their costs. This is often incorporated within the Dry Hire Agreement.
- Liability: It is very important from a Public Liability perspective to ensure you are insured for Dry Hire Operations. Claims can still be made against the hirer for Damage or Injury whilst the machine is out on hire, should the damage or injury be caused by the renters negligence or vicarious responsibilities. This could arise from maintenance requirements etc.
Whilst there are many benefits to offering Damage Waivers, it can also come at a cost! Not only will your premium likely increase by 10-15%, it is important to remember that claims will impact your loss ratio and furthermore may impact your yearly premiums.
In conclusion, dry hire damage waiver insurance is a valuable tool for equipment owners and rental businesses to protect their assets and foster positive rental experiences. By offering this insurance, businesses can attract more renters while providing peace of mind to those in need of rental equipment.
For assistance with Dry Hire Insurance, speak to one of our Insurance Advisors who will gladly help you through the process and provide an informative and seamless experience.
(07) 3279 6592