Nothing burned. Nothing flooded. The machine simply stopped.
Property insurance responds to events, fire, water, storm, theft. It does not respond to equipment failing on its own, which is how most businesses actually lose the use of their premises.
Talk to a broker What it coversSudden mechanical and electrical failure, plus spoiled stock and downtime
Anyone with refrigeration, boilers, HVAC, elevators or production plant
What equipment you rely on and how long a replacement takes
What is equipment breakdown insurance?
It covers sudden mechanical or electrical failure of equipment you own or are responsible for, boilers, compressors, refrigeration, heating and cooling systems, elevators, electrical panels and increasingly the computer systems that run all of them. It pays to repair or replace the equipment, and usually for the damage that failure causes, including spoiled stock and the income lost while you cannot operate.
A cooler failing overnight is not a property claim, so without this cover the spoiled stock, the closed days and the customers who went elsewhere are all yours. On a small business the stock loss alone often exceeds a year of premium.
A standard property policy excludes this, because breakdown is a maintenance and wear question rather than an event.
More than the machine itself.
The equipment
Repair or replacement of the failed unit, including the labour and the emergency call-out.
Spoiled stock
Refrigeration failing overnight. The single most common claim in food businesses, and the reason this cover exists for many of them.
Lost income
Business interruption caused by the breakdown, which a standard interruption policy will not pay because there was no insured damage.
Damage to other property
What the failure caused, water from a burst boiler, a power surge through connected equipment.
Expediting expenses
The cost of getting a part flown in or a crew working overnight to shorten the outage.
Computer and control systems
Modern equipment fails at the controller as often as at the machine. Cover should follow the electronics.
This is cover we write directly, with a choice of deductibles, not something we have to go looking for. Tell us what equipment the business depends on and we can price it.
Who needs it most.
If your business stops when a specific machine stops, this is not optional cover.
Anything refrigerated
Restaurants, grocers, cold storage, pharmacies. Stock loss alone often exceeds the annual premium.
Manufacturing and processing
Production lines, compressors and specialist plant with long replacement lead times.
Buildings with shared systems
Strata and commercial buildings with boilers, elevators and central HVAC serving many occupants.
A situation we see.
A walk-in cooler controller fails on a Friday night and nobody sees it until Monday. Nothing burned, nothing flooded, and the property policy pays nothing. Equipment breakdown covers the unit, the spoiled stock and the days you were closed.
It is usually inexpensive, and usually left off.
Because it does not feel like a disaster until it happens.
Nobody imagines the business closing because a compressor failed. So it is the first thing dropped when a quote needs trimming, and the omission never shows up on a comparison of premiums.
Ask us what it costs on your policy before deciding. On most small and mid-sized commercial risks it is a modest addition, and it covers the failure mode that is genuinely most likely to happen to you.
What owners ask us.
Is machinery breakdown covered by my property policy?
No. Property insurance responds to events like fire, water and theft. Mechanical or electrical failure on its own is excluded and needs equipment breakdown cover.
Is spoiled stock covered when a cooler fails?
Under equipment breakdown with spoilage cover, generally yes. Under a standard property policy, generally not, because nothing was damaged by an insured peril, the machine simply stopped.
Does it cover wear and tear?
No. It covers sudden and accidental failure, not gradual deterioration or a machine reaching the end of its life. Maintenance records help considerably at claim time.
Does it cover lost income during a breakdown?
It can, and this is the part most often overlooked. Standard business interruption requires insured physical damage, which a breakdown does not produce, so the interruption cover has to sit inside the equipment breakdown section.
What about computers and control systems?
Modern policies generally extend to electronic and control equipment. Given how much plant now fails at the controller rather than the motor, it is worth confirming yours does.
We rent our premises. Is this the landlord’s problem?
Only for equipment the landlord owns. Anything you installed, and your stock and income, remain yours to insure.
Breakdown sits alongside commercial property, which covers the events instead.
Which machine stops your business?
Tell us what it is and how long a replacement takes. That answers most of the question.