Don’t Pay for Rental Equipment When Weather Stops Work
Of all the risks heavy equipment contractors take, bad weather is one they have no control over. And when you have rental equipment in the field and a big storm brewing there’s not much you can do except watch the water and your costs rise without any corresponding increase in productivity.
One solution is a new service, called Weather Warranty, that can take the sting out of having to pay for rental equipment that you can’t use because of weather conditions. The concept is simple. For a flat fee added onto your rental contract you can get coverage that will pay your rental costs on equipment that you can’t use because of weather conditions. If you’re rained out for a certain number of days, Weather Warranty pays your rental costs on the covered equipment those three days.
The fee you pay to the dealer for Weather Warranty coverage is a percentage of your total rental cost and varies depending on the season and the part of the country. Along the Gulf Coast, for example, rates go up during hurricane season. But in general rates are in the single digits. “There are not a lot of markets or a lot of months where we’re over 10 percent on average, and that price range plays pretty well with customers,” says Richard Wilmot, head of product at Weather Warranty.
“Rain and wind are our bread and butter,” says Wilmot. “But this season for the first time we are looking at snow- and cold-related protection. We can protect people who invest in equipment in anticipation of needing to plow snow, and then compensate them for their rental fees if it doesn’t snow.” In addition to covering losses, Weather Warranty can be used to hedge your bets by reducing the financial risks of getting started on a project earlier in the spring when unexpected storms and weather disruptions are more common.
Wilmot says Weather Warranty is not insurance with deductibles and contracts and claims. Rather it is a value-added service that contractors can take advantage of at the rental store at the time of the transaction. “Our promise to our dealer partners is that we’re going to add about 30 seconds to the transaction,” he says. “No more than one piece of paper for those who are on paper and no paper for those who want an electronic document exchange. We want to be ready to serve those people in a transaction that’s already happening.”
The idea for Weather Warranty came to Wilmot and his colleagues while doing research on contractor issues for Westerfield Insurance, a company well known for their construction coverage. “I was working with a team in 2018 that interviewed GCs, subs and everyone in the industry, trying to find areas that are not well served today by insurance products.
“The one thing that kept coming at us from all angles was the financial impact and schedule disruptions caused by weather,” he says. That’s not news to anybody but it really created a lot of psychological stress for these people. That really stuck out. And we were starting to learn about some cutting-edge weather technology, that, as far as we could tell, no one was applying to the construction industry. With those two things in mind, we put together a handful of products for ideas to test and the winner just kept on being weather warrants.”
While Weather Warranty can track weather issues with pinpoint precision, different regions, jobsites and soil types can recover from of rain or snow or ice with various degrees of timeliness. And the same weather can have different impacts on different trades or types of equipment. So, to more accurately fit customer needs, Weather Warranty is designed to be customizable as well.
“We have the option for any salesperson or counter agent to do on the fly customization,” says Wilmot. “And that adds no more than 30 seconds. Most of the folks that we work with, don’t have a need for that. But for those who do, especially those who may be in a specialty business or line of work, we had that built in from day one.”
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