Machinery Breakdown Coverage

Machinery Breakdown Coverage – what you need to know

Think about the impact on your business if your equipment fails.

Immediately, your operations are interrupted. How will you deliver your orders? If you don’t have backup equipment, you may need to find alternate facilities or rent equipment, which will increase your costs. What if customers can’t wait? Orders may be cancelled, which means you will suffer loss of revenue, and possible damage to your reputation. Personal injury could also result.

A typical commercial property policy does not cover loss or damage caused by:

  • Electrical arcing
  • Mechanical breakdown, and
  • Explosion of boilers and pressure vessels

Machinery breakdown coverage covers the sudden and accidental, physical damage to equipment that requires its repair or replacement. It applies to equipment in the following categories:

  1. Electrical 
  2. Air Conditioning and Refrigeration
  3. Boiler and Pressure Vessel
  4. Computer and Communications
  5. Mechanical
  6. Renewable and Alternative Energy
  7. Production Systems
  • A power surge caused total telephone system failure for a real estate developer. Losses exceeded $39,000.
  • A furniture maker’s automated saw broke down when microprocessors were damaged by a short circuit caused by movement of the saw. Losses, including business interruption expenses, exceeded $20,000.
  • A transformer on a revenue-generating solar power system was damaged by an electrical breakdown. Total losses, including business interruption, amounted to $140,000.

To learn more about ALIGNED, our commitment to providing insurance expertise and the best insurance products or solutions, talk to one of our Advocates today. We can help you secure the best products, services and solutions for your business.

To learn more about machinery breakdown coverage and how it can protect your business, speak to an ALIGNED Insurance Advocate.

We’re here to answer your business insurance questions. Not sure who you need to talk to? Just email or call us toll-free at 1-866-287-0448 for assistance.

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