Why Replacement Cost Coverage Is Critical for Your Fire Apparatus
- Scott Poulton
- 29 minutes ago
- 3 min read
When it comes to protecting your fire department’s fleet, insuring your fire apparatus correctly is one of the most important financial decisions you can make.
Fire trucks and related emergency vehicles represent some of the most significant capital investments a department will ever make—often costing hundreds of thousands, and sometimes millions, of dollars each.
Yet many departments and cities unknowingly underinsure these critical assets by relying on purchase price coverage rather than replacement cost coverage.
Understanding the Difference
The purchase price of your apparatus is simply what you paid when you bought it—perhaps five, ten, or even fifteen years ago. The replacement cost, on the other hand, is the amount it would cost today to replace that apparatus with one of similar type and capability. Because of inflation, technology advancements, and rising material and labor costs, the replacement cost is almost always significantly higher than the original purchase price.
For example, a pumper purchased for $550,000 in 2016 might cost well over $1,000,000 to replace today. If your insurance only covers the original purchase price, your department would be responsible for the $450,000 gap if the apparatus were totaled in an accident or destroyed in a fire.
That shortfall could cripple your budget and delay your ability to respond effectively to emergencies.
The Rising Cost of Fire Apparatus
Over the last decade, the cost of fire apparatus has increased steadily due to several factors—supply chain challenges, higher manufacturing costs, and enhanced safety and technology features. Even seemingly small upgrades—such as modern electronic controls, emissions-compliant engines, and advanced communication systems—add thousands of dollars to the price. This reality makes it essential that your insurance reflects today’s market, not the price you paid years ago.
The Consequences of Being Underinsured
Being underinsured doesn’t just affect your finances—it directly impacts your ability to protect your community. Without sufficient funds to replace a destroyed apparatus, your department could be left short-staffed in critical situations, relying on mutual aid or older reserve units for extended periods. That not only delays emergency response times but also increases risk to both firefighters and the public.
Additionally, grant funding and municipal budgets are often limited, and scrambling to find emergency funds after a loss can be nearly impossible and with lead times to get a new replacement being 24 – 48 months any delays in acquiring the shortfall on the replacement apparatus can only delay those times even more. That’s why replacement cost coverage provides stability and peace of mind, ensuring you can get back in service quickly without unexpected financial strain.
Reviewing and Updating Coverage Regularly
Insurance for fire apparatus shouldn’t be a “set it and forget it” policy. Departments should review their coverage annually with a knowledgeable insurance agent who understands the unique needs of emergency services. Ask specifically whether your policy pays replacement cost value or actual cash value. The latter often subtracts depreciation, and salvage leaving you with less than what’s needed to replace your truck.
Make sure to document all equipment, custom features, and modifications as well—these add to the replacement value and should be included in your coverage limits.
Protecting Your Investment—and Your Mission
Your apparatus is more than just a vehicle—it’s a lifeline for your firefighters and your community. Ensuring it’s covered for full replacement cost isn’t just good financial planning; it’s an operational necessity. Proper coverage guarantees that if disaster strikes, your department can recover quickly, maintain readiness, and continue doing what it does best: saving lives and property.
Deciding which strategy is right for your departments budget, timeline and resources can be complicated, and mistakes can be costly- both in wasted time, and in wasted dollars. Let our decades of experience save you time and money.
Contact Fire Apparatus Consultants today.
RAY SAJDAK is a lieutenant (ret.) with the Bristol (CT) Fire Department, where he served on its apparatus replacement committee. His career in the fire service also includes 20 years as the chairman of the apparatus committee for the Portland (CT) Volunteer Fire Department. He is a managing partner with Fire Apparatus Consultants, LLC.
SCOTT POULTON is a firefighter and apparatus operator for the Bristol (CT) Fire Department, where he serves on the department’s apparatus replacement committee. His career in the fire service also includes 37 years as a volunteer firefighter with the Terryville (CT) Volunteer Fire Department, where he cochairs the department’s apparatus replacement committee. He is a managing partner with Fire Apparatus Consultants, LLC.
