Any business that’s unsure whether or how equipment breakdown would help them should speak with an insurance agent who knows this coverage well. A specialized agent will be able to give examples of breakdowns, and explain how the coverage might help.
Many Massachusetts businesses have equipment that is essential to their operations, and this equipment is often expensive. The resulting operational halt and repair that a breakdown in this equipment would cause can be expensive. One way businesses can protect against such a risk is by getting equipment breakdown coverage.
Equipment breakdown coverage is a form of specialized commercial property insurance. It’s specifically intended for essential equipment, generally protecting against malfunctions of the equipment.
What Massachusetts businesses should consider equipment breakdown insurance?
Any business that is operationally reliant on specific and specialized equipment should consider equipment breakdown insurance. Insurance can benefit many different Massachusetts businesses.
For some examples of how businesses in diverse industries might benefit from the coverage, consider the following examples:
An apartment complex needs coverage for furnaces, air conditioners and water heaters that would require immediate repair
A manufacturer needs coverage for production equipment that would halt assembly lines if it broke down
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A warehouse needs coverage for inventory management equipment that would render tracking products impossible if it broke down
A retailer would be unable to process sales if their point of sale (POS) equipment failed
A craft brewery would lose tanks of fermenting beer if certain equipment broke down and wasn’t promptly repaired
A coffee roaster would miss delivery deadlines if their roaster broke down and wasn’t promptly repaired
A restaurant would lose ingredients and be unable to serve if their stove and/or oven broke down
As these examples show, coverage can help mitigate repair costs, inventory loss and/or missed sales.
Any business that’s unsure whether or how equipment breakdown would help them should speak with an insurance agent who knows this coverage well. A specialized agent will be able to give examples of breakdowns and explain how the coverage might help.
What causes of malfunction are covered by equipment breakdown insurance?
Exactly what malfunctions a given equipment breakdown policy covers are dependent upon that policy’s terms, conditions and exclusions. With the right terms, a policy may cover malfunctions resulting from:
What expenses are covered by equipment breakdown insurance?
The exact expenses that a given equipment breakdown policy covers are likewise dependent upon terms. A policy may help pay:
Standard repair costs charged by repair professionals
Emergency after-hours or weekend fees for immediate repairs
Labor costs if repairs are made by employees
Inventory and/or supply losses due to downtime
Revenue losses due to downtime
Is boiler and machinery insurance the same as equipment breakdown insurance?
Boiler and machinery insurance is a historic insurance that’s traditionally protected against malfunctions of boilers and industrial machinery. It would be akin to policies that protect apartment buildings’ HVAC equipment or manufacturers’ assembly line equipment.
Equipment and breakdown insurance tends to make coverage available for a wider variety of equipment. In addition to HVAC equipment and assembly line equipment, this coverage might protect inventory management systems, POS systems, stoves/ovens and more.
Boiler and machinery policies used to be the predominant type of policy that provided coverage against equipment malfunction. They were common when most businesses that needed coverage were factories.
As more businesses have implemented complex systems, the need and availability for this type of coverage has expanded. Most insurers now label their policies equipment and breakdown policies, although some still offer boiler and machinery ones.
How can businesses in Massachusetts get equipment breakdown coverage?
This material is for informational purposes only. All statements herein are subject to the provisions, exclusions and conditions of the applicable policy, state and federal laws. For an actual description of coverage, terms and conditions, please refer to the applicable insurance policy or check with your insurance professional. The illustrations, instructions and principles contained in the material are general in scope and, to the best of our knowledge, current at the time of publication.