Equipment Breakdown Coverage and Why You Need to Have It
by Kerry Hongisto

Equipment Breakdown Coverage and Why You Need to Have It

Do you use equipment during your business day? I know I do! While sitting at my desk writing this blog I can see a lot of equipment that could be susceptible to breakdown. I have a computer with three monitors, a phone, and a printer at my desk. I can also see a large color copier/scanner/fax machine, and I know that if that printer broke down, there would likely be a large repair or replacement invoice.

Equipment breakdown coverage applies to many different types of equipment, and a variety of failures and causes. It can pay for direct damage to your equipment, loss of income if a covered breakdown results in partial or total business interruption, expenses incurred if you need to rent substitute equipment, and loss to products that spoiled as a result of the equipment breakdown. Some of the most common equipment that can fail are heating/cooling systems, refrigeration systems, boilers, security systems, office equipment, electrical systems, and manufacturing equipment. A manufacturer that suffers a breakdown of a machine due to metal fatigue in a small part of the machine could have to suspend their operations until the machine is repaired or replaced. A suspension in operations, even for a short time, could result in a financial loss.

No matter what type of business you work in, you have equipment that can break down. Equipment breakdown is not typically an automatic coverage on your policy, so please talk with your insurance advisor to be sure you are adequately protected. Also, one thing that equipment breakdown (or any other type of insurance) does not cover is maintenance, so make sure you’re doing your routine and preventative maintenance!

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