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Equpment Breakdown Insurance

Because 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
  • Demolition
  • 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

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