June 6, 2023
When the economy is booming, the construction industry is too. That means more rented equipment at work sites ripe for the taking. And equipment shortages due to supply chain issues — such as the world has seen since the pandemic — can lead to more theft as thieves know contractors are hungry for equipment. No matter the economic landscape, equipment theft is a perennial thorn in the side for rental businesses.
In a 2021 column, Mitsubishi HC Capital Canada cited figures showing that close to $45 million in materials are stolen from construction sites every year, and that 100 Canadian construction companies surveyed said they were victimized by such thefts twice a year — their losses averaged $25,900 for licensed vehicles and $1,600 for tools.
Those stats only reflect construction site thefts. They don’t take into account conversions — cases where you rent a piece of equipment to a renter, and they do not return it.
Westland Insurance Group, the American Rental Association’s (ARA) partner in the ARA Canadian Insurance Solutions program, is in the business of risk management and is uniquely positioned to understand the best practices that equipment and event rental businesses can adopt to help avoid costly theft attempts by bad actors.
Brock Penner, commercial account executive for Westland Insurance Group, offers some current theft trend information along with a few quick tips that can help rental business staff thwart fraudsters.
“The types of equipment most stolen would appear to be skid steers, mini excavators and generators — anything that has high value but is on the smaller side,” Penner says. “The reason for this is that it appears the theft trends are around port cities where these items are stolen. The equipment is put into shipping containers and shipped to countries with ‘looser’ importing laws and requirements. Typically, this is done through rentals made with stolen IDs and credit card information communicated over the phone.”
Penner advises the following in this theft environment:
Whenever possible, engage in face-to-face contact with prospective first-time customers. “Try to actually see the customer in person and not do the rental just over the phone,” Penner says.
Take copies of the customer’s ID and credit card. “Confirm from the ID that it is of the person who is renting the equipment,” he says.
Get a signed, valid rental agreement in place.
Use tracking devices for higher-value equipment. “That is always recommended, and the price point on this technology seems to be coming down,” Penner says.
Some of Penner’s south-of-the-border insurance peers from ARA Insurance also suggest rental counter personnel be on the lookout for red flags like these:
- People who drive a Penske or U-Haul rented truck onto your lot for the purpose of loading equipment — a known practice for many who have turned out to be equipment thieves.
- Someone who does not fully pull into your parking lot, so you can’t capture them on your security camera.
- Suspicious body language — such as someone who pulls their hat down or has a hoodie up.
- Renting equipment late in the afternoon or early in the morning — when you often are slammed — is a common tactic used by thieves.
Rental owners also understand that it is OK to blame their insurance provider for excessive documentation or verification processes when prospective renters complain. In fact, most insurance agents are happy to be “the bad guy” as it can help divert impatient customers’ ire toward counter staff while ensuring thorough vetting.
Penner encourages rental companies to reach out to him for more information on these and other theft prevention ideas at bpenner@westlandinsurance.ca. “Westland’s policies do include coverage for theft and theft by conversion,” he says.
