What is Equipment Breakdown Coverage?
Equipment Breakdown Coverage is a type of insurance designed to cover the costs associated with the sudden and accidental breakdown of essential equipment. It is commonly used in businesses and homes to protect items like HVAC systems, boilers, electrical systems, and manufacturing equipment.
This coverage goes beyond standard property insurance by protecting against internal mechanical or electrical failures rather than external forces like fire or weather damage. It can cover the repair or replacement costs of the damaged equipment and, in some cases, the loss of income due to operational downtime caused by the breakdown.
For homeowners, this type of coverage can extend to critical household systems such as heating, cooling, and water systems. For businesses, it is vital to protect key operational equipment that, if broken, could result in significant financial losses and downtime.
Equipment Breakdown Coverage can also include reimbursement for additional expenses, such as hiring temporary equipment or paying for expedited repairs to minimize disruption to business operations.