Machine Shop Business Insurance: Key Coverages You Need
- Nate Jones, CPCU, ARM, CLCS, AU
- 1 day ago
- 2 min read
Machine shops face some of the most complex risks in the manufacturing world. Whether you operate CNC mills, welding stations, laser cutters, water-jets, lathes, or fabrication equipment, your business handles high‑value tools, speciality materials, and customer-owned parts that require precise protection. Having the right machine shop business insurance ensures your shop is protected from financial loss, liability claims, equipment damage, and operational downtime. Below are the essential coverages every machine shop needs to operate safely and confidently.
General liability protects your shop when someone alleges:
Bodily injury (e.g., vendor trips and falls)
Property damage caused by your operations
Personal or advertising injury claims
This is foundational coverage and often required for contracts with manufacturers, aerospace suppliers, and industrial clients.
Machine shops rely on expensive, specialised equipment. Property insurance covers:
CNC machines
Welders
Laser cutters
Press brakes
Sawing equipment
Tooling and fixtures
Office and building contents
This coverage protects against fire, theft, vandalism, and certain types of equipment damage.
Standard property insurance does not cover mechanical or electrical breakdowns. Equipment breakdown insurance covers:
Motor burnout
Electrical failure
Compressor failure
Mechanical breakdown
This is crucial for CNC machining centers, lasers, and high‑precision equipment that is costly to repair or replace.
4. Inland Marine (Tools & Equipment Coverage)
Machine shops often transport tools, fixtures, or parts between job sites or customer facilities. Inland marine covers:
Tools off‑site
Customer property in transit
Mobile equipment
If your shop does off‑site machining, field welding, or mobile fabrication, this coverage is essential.
If your machined part fails and causes damage or injury, your business could be liable. Product liability covers:
Defective machining
Improper tolerances
Failed components in assemblies
This is critical for shops working with aerospace, automotive, medical, marine, or structural applications.
Machine shops have higher injury risks due to:
Heavy machinery
Sharp edges
Hot work
Lifting hazards
Workers’ comp covers employee injuries, medical bills, and lost wages.
Get the Right Insurance Coverages for Your Machine Shop
Not all insurance companies understand machining, welding, laser cutting, or fabrication risks, and having the wrong coverage can lead to costly out‑of‑pocket losses. Wexford Insurance partners with top-rated carriers that specialise in machine shop insurance, helping owners secure the right limits, deductibles, and policy structure tailored to their operations.
👉 Request your Machine Shop business insurance quote from Wexford Insurance today and keep your tools, equipment, and operations fully protected.