The construction industry is a cornerstone of infrastructure development, but it faces a persistent and costly challenge: the theft of tools, plant and equipment. This issue costs the UK construction sector over £800 million annually, encompassing not only the direct expense of replacing stolen items but also the indirect costs of project delays, increased insurance premiums, and lost productivity.
The high resale value of construction equipment and the ease with which stolen items can be sold on the black market make this a lucrative crime, often perpetrated by organised groups. Small and medium-sized enterprises (SMEs) are particularly vulnerable, but even large firms are not immune to these risks.
The impact of such theft on construction projects can be devastating. Missing equipment often leads to significant delays, which in turn can result in missed deadlines, strained client relationships, and financial penalties. For tradespeople, the loss of personal tools can be especially damaging, as many invest heavily in their own equipment.
Without these tools, their ability to work and earn a living is severely compromised. The ripple effects of theft can be felt across the entire project, affecting timelines, budgets, and the quality of work delivered.
While the risks are significant, there are proactive steps that construction companies can take to protect their assets. Five immediate actions to reduce plant theft include: registering equipment on the CESAR scheme; fitting GPS tracking to critical assets; installing monitored CCTV; removing keys and immobilising plant overnight; and recording serial numbers while maintaining an up-to-date asset register.
These measures, when combined, create a layered security approach that significantly reduces the likelihood of theft and increases the chances of recovery.
The role of technology
Technology is playing an increasingly important role in combating theft in the construction industry. GPS tracking devices, for example, allow companies to monitor the location of their equipment in real-time. In one recent case, a civil engineering contractor discovered that a 13-tonne excavator worth approximately £65,000 had been stolen from a secured compound. Thanks to a covert GPS tracking device, the equipment was located 40 miles away and recovered the same day, avoiding a substantial property claim and additional hire costs.
This incident underscores the importance of layered security, rapid incident reporting, and accurate asset records. As Matthew Currie, regional claims leader at Gallagher, explains: “We’re increasingly seeing organised criminal groups targeting construction plant and equipment due to its high resale value and the relative speed with which assets can be moved. In many cases, GPS tracking technology can be the difference between a temporary disruption and a six-figure uninsured loss. The most effective defence combines physical security, asset tracking, clear site procedures and employee vigilance.”
Addressing claims challenges
Gallagher, in association with Crawford, has developed a Plant & Tool Theft Claims Proposition to address the challenges faced by contractors. Conventional claims processes often suffer from unclear intake channels, delays in instruction allocation, and handling by adjusters who lack expertise in plant and tool claims. These inefficiencies can lead to prolonged settlement periods, increased hire costs, missed salvage opportunities, and suboptimal customer outcomes.
This proposition can transform this experience by offering a tailored gateway for new instructions, director-led triage and allocation, and handling by dedicated specialist adjusters.
The valuation function offers accurate reserving and early settlements, while proactive investigation techniques drive efficient outcomes. Claims are closely monitored with rolling three- and five-day action reviews, and unresolved claims are escalated to regional managers or directors within 20 days. This approach helps ensure claims can be concluded within 28 days.
The advantages of this proposition are designed to condense claim lifecycles, create accurate reserving and settlement values, maximise salvage returns, and offer excellent customer outcomes. By combining Gallagher’s insurance specialism with Crawford’s claims management capabilities, contractors can benefit from a streamlined process that minimises disruption for a swift resolution.
Ultimately, tools, plant and equipment theft is a challenge that requires a multi-faceted approach. By investing in robust security measures, leveraging the latest technology, and fostering a culture of vigilance, construction companies can protect their assets and minimise the impact of theft on their operations.
At Gallagher, by understanding the unique risks faced by the construction industry and our commitment to providing tailored insurance solutions and risk management strategies, we are helping to build a more secure and resilient future for the sector.
