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EQUIPMENT BREAKDOWN

PROTECT YOUR OWN

WHAT IS EQUIPMENT BREAKDOWN (EB)?

Equipment Breakdown Insurance also called Boiler and machinery insurance (BM) provides coverage for physical damage and financial loss from equipment breakdown. Covers the cost of repairing or replacing the damaged equipment and business losses incurred from the equipment not functioning. Equipment breakdown insurance can cover a wide range of equipment besides boilers and furnaces, including elevators and office equipment.

Equipment breakdown insurance protects machine shop owners who may already have standard property insurance coverage on their machines, but no insurance coverage for Crash due to Operator Error. These crashes can break a spindle or damage the cutting apparatus as a result of a programming error.

KEY TAKEAWAYS

  • Equipment breakdown insurance provides coverage for physical damage and financial loss from equipment breakdown. 

  • Equipment breakdown insurance covers the cost of repairing or replacing the damaged equipment, motors, computers, telephones, and electrical.

  • Business losses incurred from the equipment not functioning are also covered, such as spoiled food and loss of income due to downtime.

How does equipment breakdown insurance work?

 

Equipment breakdown insurance covers the risk that equipment, used by a business to deliver goods and provide services, will not function properly. Companies purchase this type of insurance to protect equipment much in the same way as property insurance protects buildings, and liability insurance protects workers from injuries.

Commercial property insurance typically covers external factors impacting a business, such as a fire. As a result, businesses would need to buy Equipment breakdown insurance to cover internal issues regarding equipment damage or failures, which can stop a company's operation from running.

Operator Error Protection:

 

  • Provides physical damage coverage to the machine due to programming errors

  • Repairs or replaces parts and key machine tool components

  • Optional coverage for accessories

Examples include the following types of machines tools:

 

  • Vertical/Horizontal Milling

  • Injection Molding Machine

  • Electrical Discharge Machine

  • Universal/Multi-axis Machine

  • Vertical/Horizontal Lathe

  • Additive Manufacturing

  • Laser Cutting

 

Notable Exclusions

 

  • Mechanical breakdown (other than resulting directly from Operator Error)

  • Electrical breakdown, power surge

  • Fire, including smoke from a fire, or any type of combustion explosion; however, this exclusion does not apply to fire resulting directly from Operator Error

  • Theft, Flood, Wind, Water Damage, Earthquake