Since your business depends on equipment to keep it going and maintain a revenue stream, a breakdown could be a potentially devastating financial experience. Learn how to protect your business now.
What is Equipment Breakdown Insurance?
Problems with your business equipment can be risky if you are not adequately insured. A standard property insurance policy will not cover these types of losses.
To combat potential risks, equipment breakdown insurance—formerly known as boiler and machinery insurance—will cover you in the event of a breakdown or damage.
The following are typically covered under this type of policy:
- Property damage (both on- and off-premises)
- Business income: Income lost resulting from a covered accident until equipment is replaced or repaired. Allows for additional time after repair or replacement to assure that the business is operating at total capacity
- Contingent business income: Income lost after a breakdown at an essential customer or supplier location.
- Extra expense: Additional expenses incurred to keep the company going after a loss (e.g., equipment rental fees)
- Service interruption: Income lost and extra expenses incurred after a breakdown at a supplier with whom the insured had a contract. If no agreement exists, the equipment must be located within one mile of the insured’s location.
- Perishable goods: Food spoilage, manufactured goods, or other perishable items lost after a covered incident
- Ordinance or law: Costs associated with complying with building codes and laws
- Expediting expenses: Temporary or permanent repairs to get the business going again
- Hazardous substances: Cleaning, repairing, or replacing areas contaminated by dangerous substances after a loss
- Data restoration
- Newly acquired locations
- Errors and omissions
- Brand and labels: Need to sell a damaged product for less than retail price
- Waive of in-use restriction
Top 5 Most Common Breakdowns:
The following common breakdowns can often be avoided by adequately conducting routine maintenance:
- Electrical systems
- Air conditioning and refrigeration
- Boilers and pressure vessels
- Computers and communication equipment
- Mechanical systems