Equipment Sales and Rental

The Equipment Sales and Rental Coverage form is to provide separate limits coverage for each category of described property. IM 7700 provides coverage for equipment and other related property while at a described premises and for off-site exposures.
IM 7700 01 09 — This coverage form provides “all risk” coverage for equipment at scheduled locations. Under this coverage form, there are two coverage schedule options:
IM 7705 Schedule Of Coverages — Inside and Outside Building Coverage should be used to provide a limit for described property that is inside of buildings and a separate limit for described property that is outside of buildings.
Coverage inside and outside of buildings is limited to the types of described property that is checked off on the schedule of coverages. Coverage is also limited to property at a scheduled location (premises).
IM 7706 Schedule Of Coverages — Separate Limit Coverage should be used to provide separate limits for each category of described property (e.g., equipment sold to others).
Most equipment dealers keep track of property based on the type of property (e.g., equipment for sale) they have, rather than basing their inventory on the amount of values that are inside or outside of buildings. Separate Limit Coverage provides coverage in accordance with the way dealers keep track of their property. Coverage for described property is limited to the insured’s premises and the premises must be described on the Schedule Of Coverages.
There are four coverages provided under IM 7700. Each of these coverages is optional. Each coverage must be activated by putting a check mark next to the coverage on the Schedule Of Coverages.
  • Equipment Intended For Saleis included on the equipment schedule
  • Equipment You Lease Or Rent To Others
  • Equipment Of Others You Are Repairing Or Servicing
  • Accessories, Fluid And Lubrication Supplies, And Tires
Excluded Property — There is an exclusion for manufactured equipment that refers to equipment being manufactured by the insured. Equipment that is shipped to the insured and requires assembly by the insured is not excluded. The exclusion for sold property refers to property that has been sold and delivered by the insured. This exclusion includes property that is sold under the terms of an installment sales plan. Coverage for equipment under an installment sales plan can be provided by using endorsement IM 7716.

Coverage Extensions

Debris Removal
25% of paid loss amount + an additional $5,000

Emergency Removal
10 days

Emergency Removal Expenses

Supplemental Coverage

Equipment On Exhibition

Equipment Sent Off-Premises For Repairs

Newly Acquired Premises

Off Premises Trial Period

Pollutant Cleanup and Removal

Sewer Backup



ACV Or Replacement Cost — The value of equipment is based on either actual cash value or replacement cost. The valuation provision can vary by types of equipment and property. For example, replacement cost provisions can apply to new equipment for sale and actual cash value provisions can apply to used equipment. Also, actual cash value or replacement cost provisions can apply to equipment that the insured leases or rents to others.
Equipment Sold — The value of equipment that has been sold will be based on the selling price less any discounts or un-incurred expenses (e.g., transportation).
Equipment On Consignment — The value of equipment being sold on consignment will be based on the agreed upon value between the insured and the owner of the equipment. If there is no written agreement, the value of property on consignment will be based on the actual cash value.
Coinsurance — Optional coinsurance provisions are built into IM 7700. The Schedule of Coverages can be used to indicate if percentages of 100%, 90%, 80%, or another percentage applies.


Additional Property Coverages IM 7711 —provides coverage for a variety of property that dealers may use as part of their operations:
  • Valuable papers and accounts receivable
  • Insured’s supply of gasoline in a fuel depot
  • Tools own by the insured and tools of employees (coverage is limited to the insured’s premises)
  • Business personal property (e.g., office contents)
  • Mobile equipment used by the insured to operate the dealership (e.g., forklifts, computers)
Property You Lease Or Rent To Others
IM 7713

Fraud And Deceit Coverage
IM 7715

Installment Sales
IM 7716

Peak Season Coverage
IM 7717

Repair Service Coverage
IM 7718

Tool Coverages
IM 7719

Equipment Hauling Coverage
IM 7721

Hail Deductible
IM 7722

Hail Exclusion
IM 7723

Coverage For Loss Of Equipment Rental Income
IM 7724

Earthquake And Flood Coverage Endorsement
IM 7857

Information provided by American Association of Insurance Services, Inc., REV 05 12 04 — Copyright © 2004
NER Logo
Southwest Transportation Security Council Logo
National Truck and Heavy Equipment Claims Council Logo
TattleTale Logo