And then talk to an agent about the following:
Should I get equipment breakdown insurance if I don’t own the equipment?
Yes. Business equipment insurance may not be your responsibility. But if the equipment breaks down, you could lose productivity, customers & income. Maybe you use leased equipment. Or one of your vendors, like an internet service provider, experiences a service outage. Equipment breakdown insurance covers business income losses in these situations.
Does property insurance cover equipment breakdown?
No. Most standard property insurance policies don't cover your business equipment. And warranties can be limited - typically only covering new equipment for a short period of time. And they definitely don't cover lost business income. Talk to your agent about adding an endorsement for equipment breakdown coverage.
What if you don’t own your building?
Even if you lease your building or use equipment that belongs to others, you still need equipment breakdown insurance. Say for example, you run a restaurant in a leased space. The electrical panel shorts out, killing power to the heat, air conditioning, lights and refrigerators for a couple of days. Although the owner of the building is responsible for making the repairs to the panel, you've lost customers and income. Equipment breakdown insurance helps you pay for that lost business income.
What if an equipment problem off site impacts your business?
Sometimes, equipment breakdowns at other locations can cause a loss to your business.
For example, if you run a small business and depend on your website for orders, you probably have an independent Internet service provider hosting your site at another location. What happens if that location loses power or experiences damage to its equipment, causing an interruption of your web presence resulting in a loss of orders? Equipment breakdown coverage helps pay for lost business income when a key supplier's equipment breaks down.
How much equipment breakdown insurance should I buy?
- Damage to your equipment
- Damage caused to others’ property
- Unavailable replacement parts
- Being closed for an extended time
An honest look at how things can add up gives you a better idea about the amount of coverage you could need and what your equipment insurance quote will look like.