Equipment Breakdown Insurance

What is Equipment Breakdown Insurance?

Equipment breakdown insurance is a type of commercial insurance that protects businesses from losses sustained by the breakdown or cease of operation of a variety of equipment that is vital to the day-to-day operation of the business. This type of insurance can help protect against power outages, faulty equipment and other unexpected events. 

What Does Equipment Breakdown Insurance Cover?

Equipment breakdown insurance generally covers the costs of repairing and replacing equipment that breaks down, but it can also cover the income lost due to the breakdown occurring. The type of equipment that is generally covered under most equipment breakdown insurance policies includes: 

  • Electrical equipment: can include transformers, cables, panels, etc. 
  • Mechanical equipment: can include manufacturing equipment, motors, engines, robotics, automation systems, drives, generators, elevators/escalators, water pumps, mechanical system components, etc. 
  • Computer equipment and systems: can include computers, servers, point of sale systems, security systems, fire alarms, etc. 
  • Communication equipment: can include telephony, voicemail systems, fax servers and machines, etc. 
  • HVAC: can include heating and air conditioning systems, boilers, etc. 

If any of these types of equipment break down or fail, equipment breakdown insurance will usually reimburse for the following expenses: 

  • Repair and replacement costs (even rush repairs) 
  • Lost revenue due to system/equipment downtimes 
  • Any damaged or lost inventory 
  • Mandatory inspections of equipment 
  • Some additional expenses incurred during the time it takes to get equipment replaced and back up and running 

Depending on the plan, equipment breakdown insurance may also cover damage to another person’s other equipment/premises due to the breakdown of a piece of equipment. 

Equipment breakdown insurance plans generally do not cover incidents that involve ordinary wear and tear on equipment, poor maintenance or neglect, or old equipment that needs to be replaced. It’s also limited by the maximum claim set for the plan, meaning the business owner will have to pay out of pocket for any additional expenses that exceed the coverage limit. 

Obtain Equipment Breakdown Insurance in Minnesota

Are you a Minnesota business in need of an equipment breakdown insurance plan? Contact the commercial insurance experts at The Patrick J. Thomas Agency. Our team can help you create a coverage plan that is right for your business. Get in touch with us today.