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Avoiding the Big Spend: Tracking and Caring for Rental Equipment


Sometimes, renting equipment makes perfect sense. In this still-tight credit environment, some lenders aren’t willing to finance a large piece of equipment, or an outright purchase might not add up financially if the equipment is only needed for a short duration. For contractors on a budget, rental companies usually have the latest models in their inventories, a luxury that is out of reach for many smaller firms. Plus, renting equipment is convenient, with the duty of maintenance, setup and transportation being someone else’s problem.

Nevertheless, there are still ways contractors can end up paying more than they planned for that rented backhoe or core driller. The good news is that there are strategies to prevent that extra spend.


Hands down, the first line of defense against serious out-of-pocket expense is insurance coverage. Rental outlets offer insurance as part of their services, but the more cost-effective route for contractors is adding a rented-leased equipment rider to an existing general liability policy, according to Robert McCarthy of GRBM Insurance, Brewster, N,Y. These riders protect renters from loss due to damage, fire, theft and more. The cost is typically a fraction of the price tag of supplementary insurance offered by most rental companies, McCarthy says.

In addition, these policies can be designed to cover damage to a third-party’s equipment while transporting the rented item, or will even pay costs for rush delivery in a time-critical situation.

Of course, insurance coverage has its limits, and most policies don’t offer endless loss reimbursement, so it’s smart to have backup policies in place as well. Making a claim against insurance should be a last resort.


First, companies should limit who is authorized to rent equipment on their behalf. Field personnel develop relationships with vendors, and that’s a beneficial connection, but it’s important to authorize only a few employees—depending on the size of the project—to rent equipment. Those names should be passed along to the rental company as well. If an employer ends up taking away renting privileges from some employees through this process, upper management should ensure that this policy is presented as a control measure only and not because of a trust issue.

One of the advantages to renting a large piece of equipment is that the company usually delivers it to the jobsite. Before accepting delivery or removing the piece of equipment from the rental company’s location, the responsible employee should inspect it to make sure it’s in proper working order. No one wants to pay for something that doesn’t work, but it would be worse to pay for damage someone else caused.

Once the equipment is determined to be in proper working order and is onsite, employers should have some type of user accountability protocol ready to roll. This isn’t as much of a concern if the piece of equipment is for a one-off task and will be picked up at the end of the day. However, if the tool will be on the project and used by more than one employee, contractors should implement a sign-in and sign-out system, either manual or digital. Barcode-based software solutions can facilitate equipment check-in and check-out, but a sheet of paper with space for a description of the equipment and who has possession of it will suffice.


According to McCarthy, theft is the biggest loss when it comes to rental equipment, so tracking it through the day via a reliable system of recorded employee use is the best way to narrow down the search if it comes up missing. GPS devices can be affixed to equipment so that it can be tracked to any location. Contractors also should make it a habit to use immobilization devices, such as wheel locks for drivable equipment, when rented items are sitting idle.

If the jobsite is in a particularly high-crime area and the equipment will be left overnight, the storage area should be secured with lockable fencing and surveillance cameras at the very least.


Make sure employees are qualified to use the equipment. Proper use is especially important because most rented-leased equipment riders don’t cover damage from misuse.

When it comes to drivable items, industry certifications abound; at the very least, operators should have a driver’s license. However, there are instances in which OSHA requires special training, such as the use of a forklift. If the agency discovers that non-certified personnel are operating such equipment, it won’t hesitate to levy a hefty fine against the employer—particularly painful since OSHA fines were increased 78 percent across the board back in August. Even if special certifications are not required for the equipment, employers should take the time to make sure anyone who will be using it, or will be in the use area, is briefed on potential safety issues and basic operation.

Perhaps the most important thing to keep in mind while renting equipment is that someone else will be renting it down the road. While big-ticket maintenance is the rental company’s responsibility, a common standard of care—including cleaning, proper storage and use, and a system of oversight—will go a long way in extending the life of the item, sustaining a good relationship with the rental company and reducing the potential for extra costs.


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