GPS and other low-tech solutions can help

A December 2010 equipment theft advisory released by the National Equipment Register (NER), a New York-based theft recovery and risk management company, sounded the alarm that equipment thefts are again on the rise. According to the release, the top stolen kinds of equipment were skid-steers/compact tractor loaders, tractors, backhoes, generators and commercial mowers.

Over the life of our program at ARA Insurance, we’ve seen 12 percent of our claims coming from equipment thefts, although this figure has varied slightly from
year to year. For example about 13 percent of our claims involved theft in 2009. However, this fell to 10 percent in 2010.

What does this mean for rental operators? For one thing, theft claims can be costly. Depending on the insurance coverage, rental operators have to pay deductibles ranging anywhere from $1,000 up to $10,000 or more. Then there’s the money lost from not having the equipment available to rent, not to mention the worry, aggravation and time spent filling out forms and reports.

There are risk-reduction strategies rental operators can implement. Rocky Arries, a detective with the Albuquerque Police Department, recommends installing GPS devices on high-risk equipment. Arries, who works the heavy equipment/auto theft detail, says GPS with starter disabling capabilities, motion and curfew alerts, and geo-fencing can assist in preventing thefts and aid in the recovery of stolen equipment.

These features can make GPS cost-prohibitive for rental operators, but today there are more streamlined, less expensive versions available. William Saunders, vice president of Bledsoe Rentals in Olathe, Kan., installed GPS on the company’s 18 skid-steer loaders in December, prompted by a four-month rental of nine of these machines for snow removal, which meant the units would be sitting unattended for stretches of time in between storms.

Because the primary concern was to know where the machines are, Saunders says the company opted for a location-only GPS device that enables online tracking. It works on cell phone triangulation rather than on satellite, providing the ability to find the equipment even if it’s inside a structure.

Osvaldo Garcia, owner of Volvo Rents Construction Equipment in Donna, Texas, has installed GPS with starter shutdown on 14 pieces of equipment, but he’s taken theft prevention a step further. Over the four years he’s been in business, the rental store has been broken into six times. Even security bars didn’t deter the determined thieves. So last April, Garcia installed a 10-ft.-tall leased electric fence that encircles his property. At 7,000V, it won’t kill an intruder, but it does deliver enough of a jolt that would-be thieves should be quickly dissuaded. There also are warning signs all around the fence. This, says Garcia, has given him “great peace of mind.”

About two years ago, Brett Richter, owner of Double D Rental & Sales in Langley, Wash., says large equipment began disappearing from his area. Until then, their Whidbey Island location had somewhat insulated residents from crime, but after these and other types of thefts, Richter sensed things were changing.

He was especially concerned because there’s no fence around his rental lot. To protect his trailers and trailered equipment, Richter began using trailer hitch locks that are keyed alike, allowing all 30 of his trailers to be locked and unlocked with the same key.

Richter had used other locking systems before, but none were keyed alike, instead requiring different keys, an inconvenience that resulted in trailers not being locked up as they needed to be.

“Now, every employee has a key and if they’re out on the lot and see a trailer that needs locking, they don’t have to run back and search through a big rack of keys. They have it right there,” says Ritcher.

Along with whatever devices you can afford, Arries says rental operations shouldn’t overlook the low-cost and no cost strategies that can help keep your equipment where it belongs.

These include never leaving equipment loaded on trucks or trailers in the yard, always securing equipment, installing security cameras — such as more inexpensive game cameras used by hunters — and staying aware.

Arries and the Albuquerque Police Department introduced these and other theft-prevention tactics to rental operators, equipment manufacturers, contractors and dealers halfway through 2008. That year, there were 23 thefts and five recoveries. By 2010, this figure had dropped to five thefts and one recovery, which, Arries says helps show that low-tech solutions can make a huge difference.

Bob Wooldridge is a claims analyst for ARA Insurance in Kansas City, Mo. For more information, call 800-821-6580 or visit www.ARAinsure.com.