Unfortunately, tool and equipment theft remains a big challenge for contractors and builders everywhere. In fact, the Heavy Equipment Theft Report (2014) by the National Insurance Crime Bureau (NICB) reports that contractor tool and equipment theft has risen 1.2 percent in the last few years and costs between $300 million and $1 billion annually. The NICB says top three types of construction equipment stolen in 2013 were loaders, tractors, and excavators. Meanwhile, recovery rates for stolen equipment are even less than one in four.

Deterring criminals from theft requires serious preventative measures. Follow this four-step process to minimize unexpected loss and ensure on-time project completion.

STEP ONE: Label it all properly

Label everything, and not just with paint. Use a welder to add the company name to large equipment and an etching tool for smaller equipment and tools. Consider marking attachments and removable parts as well. Most construction equipment does not have a title or registration so the markings installed by the contractor may be the only way to identify and reclaim stolen equipment. Maintain a record of what was marked and where it is labeled on the equipment for proof.

STEP TWO: Implement multiple layers of security

Locked gates, light pods and an onsite security presence are good ways to deter thieves. Newer security technologies allow for multiple battery-powered cameras, alarms and lights to be remotely setup on motion sensors with smart device notifications. Signage stating that site surveillance is in use can further deter criminals. Climb-resistant fencing is gaining popularity as well. Overall, onsite security guards are the most effective security measure, but a combination of approaches is generally recommended.

STEP THREE: Safeguard Drivable Equipment

Keep generators, welders, light pods and smaller equipment out of sight and encompassed by larger equipment or structures so that it cannot be easily wheeled away. When it comes to drivable equipment, consider including additional shutoff and lockout points to keep equipment from being driven off site. Ask an equipment dealer for hydraulic locks, electrical lockouts and other options for hidden disconnects. Take additional measures on smaller heavy equipment, including loaders and tractors. These are the most commonly stolen because they are the easiest to load. Finally, store and lock equipment keys in another location, away from the equipment. Often equipment is stolen because it had the key on the dipstick, under the mat or in an area where a thief could easily locate.

STEP FOUR: Have Adequate Storage Ready to Go

Ensure each piece of equipment goes into secured storage when not in use. When gang boxes are used, be certain they are built with enclosed and recessed locking points along with non-drillable locks. After the gang box has been set onsite, remove the wheels and lock it down. Ensure vehicles are locked and an alarm system engaged when tools are left in the vehicle or brought home from the worksite.

With costs of construction equipment theft reaching $1 billion annually - not including rental equipment, project delay penalties, business interruption, or unproductive man-hours – keeping your tools safe has never been more critical. An effective theft prevention strategy using these four steps can minimize the effect equipment and tool theft has on a contractor’s bottom line.


Phil Casto is Senior Vice President for Risk Services at HUB International. Casto has extensive experience in the construction, manufacturing and petrochemical industries. He serves as a resource for the insurance brokerage operations, providing solutions in the areas of risk mitigation, safety, regulatory compliance, and workers compensation