To learn what specific protections your business equipment breakdown coverage provides, read your policy carefully or ask your insurance agent. A thorough inspection may help prevent problems before they arise. For example, if a piece of equipment malfunctions and damages someone else’s property, equipment breakdown coverage may help protect you against liability costs to the owner of that property.Ĭoverage may include the cost of mandatory inspections of key equipment. If an equipment breakdown causes an interruption to your business, that interruption generally has to continue for a period of time before coverage for lost income kicks in.Įquipment breakdown coverage may provide liability protection if a breakdown or accident causes damage to others, according to the NAIC. The International Risk Management Institute (IRMI) notes that a claim for loss of business income has to be thoroughly documented. If critical equipment breaks down and you can’t run your business normally, equipment breakdown coverage may help reimburse you for lost business income. This can help minimize the time a business may be forced to shut down as the result of an equipment breakdown. 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. For example, if a refrigerator at your catering company breaks down, equipment breakdown coverage may help with the costs of replacing the food that spoiled. Coverage may also help pay to replace perishable goods.
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