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Written by Adam Miller
Understanding the Basics of Equipment Breakdown Coverage

Many companies rely on equipment in order to run their business, so when there is a problem with that equipment, the entire business could be affected. When business-critical equipment breaks down or fails, it can lead to substantial losses of revenue and customers. Today's Aegis blog post looks at how Equipment Breakdown Insurance coverage can help mitigate those losses and help companies recover with minimal impact.

What is Equipment Breakdown Insurance?

Equipment Breakdown Insurance works by helping pay for replacing or repairing business equipment that has broken down or been damaged due to a covered event. In addition, it may also cover business losses that occur as a direct result of the equipment breakdown or failure. Typically, commercial property insurance policies on their own do not cover losses related to equipment breakdowns, so companies need some way to cover these expenses and resulting losses or face paying for these out of pocket. Equipment Breakdown Insurance can help companies whether they own or lease their business property or business equipment.

How Does It Work?

Repairing or replacing business equipment can be time-consuming and costly, so it's essential to have business insurance that can help with these expenses. Equipment Breakdown Insurance can cover replacing or repairing damaged equipment that is necessary to keep your business operational, whether that's a computer network, HVAC system, specialized machinery, or other mechanical or electrical equipment. These breakdowns could be caused by covered events such as mechanical malfunctions, operator errors, or power surges. Equipment Breakdown Insurance may also cover the cost of time for time and labor to replace the equipment, as well as the business income that's lost when the equipment breakdown causes a partial or full business interruption.

Why Is It Needed?

Businesses of all industries could benefit from having Equipment Breakdown Insurance, simply because all businesses rely on some sort of equipment or machinery in order to function, and the cost of repairs and replacement can be shockingly high. For example, you might own a small bakery that uses simple ingredients, but if you rely on industrial mixers, refrigerators, and commercial ovens to run your bakery, then repairing or replacing all of these due to a power surge could put a severe financial strain on your business. If you own a law firm or a retail store, then a mechanical malfunction with your heating and cooling system could make it extremely uncomfortable for employees or customers, forcing a temporary shutdown until repairs are made.

It could take one simple event for a well-established or thriving business to face financial strain because of equipment failure or mechanical breakdowns, so it's important to have insurance that can help in these instances. Aegis Insurance & Financial Services offers Equipment Breakdown Insurance coverage for businesses of all sizes and industries, whether it's restaurants, retailers, contractors, repair shops, farms or ranches, or law firms. Contact Aegis today at 713-850-7622 for more information, or fill out our online form to request more information.


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