Equipment Breakdown Coverage Basics
What is equipment breakdown insurance?
Equipment Breakdown insurance, sometimes referred to as boiler and machinery insurance, covers the costly physical and financial damage that can result from an equipment breakdown (PDF, 1.1 MB). This is critical coverage for any business or institution because standard commercial property insurance forms typically exclude the losses that equipment breakdown insurance is designed to cover, such as:
- Mechanical breakdown
- Electrical arcing
- Artificially generated electrical currents
- Centrifugal force
- Bulging, cracking or collapse of pressure vessels
What types of equipment are covered?
Equipment breakdown coverage insures a variety of equipment types such as:
- Air conditioning and refrigeration
- Electrical equipment
- Computers and telecommunications
- Business equipment
- Production machinery
- Computer-controlled machines
- Security systems
- Retail “point of-sale” systems
- Ventilation systems
- Elevators and escalators
- Hot water heaters
- Motors and pumps
Expanded equipment protection
In addition to other existing broad coverages, our equipment breakdown protection includes:
- Mold – covers costs up to $25,000 to repair or replace and clean up or dispose of covered property when mold contamination results from a breakdown; coverage extends to Business Interruption and Extra Expense if included in the policy;
- Anchor Location – expands Contingent Business Income coverage to business income loss resulting from a covered accident at an anchor location that attracts customers to an insured location;
- Civil Authority – expands Business Income and Extra Expense coverage to include loss resulting from a civil authority denying access to an insured business as a result of a covered breakdown to a business located within one mile;
- Environmental, Safety and Efficiency – coverage has been increased from 125% to 150% of the loss payable for upgrades to equipment we agree is more energy efficient, safer or more environmentally friendly;
- Green Equipment Breakdown – coverage now pays up to $25,000 in addition to any applicable coverage under “Environmental, Safety and Efficiency Improvements;"
- Brands and Labels – coverage has been expanded to cover the cost of stamping or removing labels on salvageable, but damaged merchandise;
- Off-Premises Property Damage – coverage has been enhanced to provide for a breakdown that occurs in any country, where permissible by law.
HSB’s Equipment Breakdown policies also include services to help clients meet local inspection requirements, prevent loss and get back into business if they do experience a breakdown. Our services include:
- Jurisdictional inspections of boilers and pressure vessels, required by virtually all states and municipalities, are a built-in benefit of HSB’s Equipment Breakdown coverage;
- Loss prevention services designed to help business owners improve equipment operation and maintenance programs to prevent losses that can impair production or service capabilities;
- Claim service to help clients more swiftly restore business operations following an equipment breakdown.
Exclusive coverage options for today’s information exposures
Exclusively for agents and brokers, our equipment breakdown insurance can be combined with optional data breach and identity theft coverages, all in an easy and affordable bundle.
Data breaches and identity theft are on the rise and HSB's coverages can help protect your commercial clients against today’s information exposures. HSB Data Compromise and HSB Identity Recovery coverages are options now available to bundle with HSB's Equipment Breakdown policies (available in most states).