Equipment Breakdown Coverage

Practically every business depends on equipment, from heating and air conditioning, to alarms and security, to computers and phones. If any of these things break down, it may affect your ability to run your business — and hurt your bottom line.

Equipment breakdown insurance may help provide some protection. Equipment breakdown coverage is an optional protection that may be added to a commercial property insurance policy, according to the Insurance Information Institute (III).

Coverage for Physical Damage

Equipment breakdown coverage may help protect your business from damage to many kinds of equipment, according to the International Risk Management Institute (IRMI). If your business's equipment is damaged or breaks down in an accident, this coverage may help with the cost of replacement or repair.

Coverage may extend to equipment such as boilers and machinery, but may also include office air conditioning, computers, and security systems — potentially, any equipment that your business needs to keep running.

Depending on your policy, covered incidents might include power surges, short circuits, mechanical breakdowns, motor burnouts, or even operator error. Coverage may also help you replace perishable goods such as spoiled food.

The National Association of Insurance Commissioners (NAIC) notes that coverage may also help protect you against the cost of making temporary repairs to your equipment, or the extra cost of speeding up repairs. This can help to minimize the time a business may be forced to shut down as the result of an equipment breakdown.