Equipment Breakdown Protection Insurance

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Equipment Breakdown Protection Insurance Policy Information

Small Business Equipment Breakdown Protection Insurance

Equipment Breakdown Protection Insurance. This coverage is necessary for any company or business that makes use of mechanical equipment - even computer systems - to get the job done. Equipment breakdown protection insurance covers you against any damage to your equipment that stops the equipment from functioning and your business from doing what it's meant to.

There are some conditions which will not be considered equipment breakdown by the insurance policy. Here's some more information about this important type of insurance, and why you'll need it.

Equipment breakdown protection insurance covers loss or damage to your property that results when covered equipment breaks down - with rates as low as $27/mo. Get a fast quote and your certificate of insurance now.

Below are some answers to commonly asked equipment breakdown insurance questions:


How Much Does Equipment Breakdown Protection Insurance Cost?

The average price of a standard Equipment Breakdown Protection Insurance policy for small businesses ranges from $37 to $59 per month based on location, revenues, types of equipment covered and more.

What Does Equipment Breakdown Protection Insurance Cover?

Broken Refridgerator

Equipment breakdown protection insurance covers you in the event of an equipment breakdown that renders the equipment unusable for business. First, the equipment will have to be assessed by the insurer and the event will have to be considered a breakdown according to the terms that have been set by the insurance company.

Sometimes there are exclusions, and not everything that goes wrong with equipment will be considered to be a breakdown - for individual terms, ask your insurance company to clarify the terms.

So what does equipment breakdown protection insurance cover? Equipment breakdown protection insurance covers Direct Loss to Property. The policy covers direct loss to all property at the premises described on the declarations that is owned by the named insured or is in the named insured's care, custody or control and for which he or she is legally liable.

This is not limited to the equipment that breaks down. It includes the building, business personal property and other equipment that the equipment may damage as it breaks down or flies apart.

  • Electrical Failure: Certain types of electrical failure will not be covered by your EB insurance, though any electrical or electromagnetic energy that damages your equipment will be covered by EB Insurance.
  • Mechanical Breakdown: Mechanical breakdown of equipment are covered by EB Insurance, including any losses that have occurred due to mechanical failure.
  • Boiler Explosions: Boiler accidents and explosions are classed separately from simple mechanical failure, and there are still many factors at play: But generally, this should be covered under the terms of your EB Insurance.

What Is The ISO Equipment Breakdown Protection Coverage Form?

The Insurance Services Office (ISO) Equipment Breakdown Protection Coverage Form completes the property coverage that you need. Commercial property coverage forms specifically exclude most types of equipment breakdowns while the Equipment Breakdown Protection Coverage Form Insures ONLY equipment breakdown.

Eligible property includes all property the named insured owns. It also includes property that the named insured does not own but that is in its care, custody, or control and for which it is legally liable.

This coverage includes inspection service as a part of the basic coverage because you can eliminate most equipment breakdowns with proper maintenance. These inspections also satisfy any obligation you have to conduct required governmental or statutory inspections.

Consult the policy for definitions and limitations. The terms of this brochure do not represent contract terms. The policy is subject to company underwriting practices.

Covered Cause Of Loss

The Equipment Breakdown Protection Coverage Form covers loss or damage to your covered property that results when covered equipment breaks down.

Covered Equipment

Four types of equipment you may own or operate can be covered:

  • Diagnostic Equipment
  • Mechanical and Electrical Equipment
  • Pressure or Vacuum Equipment
  • Production Machinery

This coverage also applies to your computer equipment, communications equipment, and equipment that generates, transmits, or uses energy.

Covered Property

All property you own is covered for damage caused by covered equipment breaking down. Property you do not own but that is in your care, custody, or control and for which you are legally liable is also covered.

Breakdown

Breakdown is direct physical loss or damage to your covered equipment caused by the following:

  • Failure of pressure or vacuum equipment
  • Mechanical failure, including rupture or bursting caused by centrifugal force
  • Electrical failure and electrical arcing

Inspection Service

One of the most valuable features of this form is the inspection service provided by the insurance company. Through these periodic inspections, dangerous conditions in the equipment can be detected before they cause an accident.

This service is included in the premium charged for the policy. In most territories, a governmental body mandates periodic inspections of boilers and other equipment covered under the policy. Most authorities accept the inspections made by the insurance carrier as complying with their laws governing inspections.

The company's inspection is not a warranty of the safety of the equipment and does not relieve the insured of his or her obligations under the federal Occupational Safety and Health Act, nor of any responsibility for the proper use of the equipment.

The company is permitted to inspect any insured equipment and the premises at any time as long as the request to inspect is considered reasonable.

Specific equipment can be suspended from coverage immediately if it is found to be in a dangerous condition. A notification must be mailed or delivered to the named insured but the suspension of coverage is immediate. Reinstatement of the covered equipment cannot be done verbally. The company must issue a written endorsement stating that the equipment is reinstated.

Important Condition - Suspension

Coverage can be suspended immediately if an insurance company representative notices a dangerous condition and notifies you of the suspension. If you continue to operate a suspended piece of equipment, coverage for any damage caused by that equipment breaking down is excluded.

What Are Equipment Breakdown Protection Coverage Form Endorsements?

Equipment breakdown protection insurance provides you very broad coverage. A limited number of endorsements are available for use with it that broaden, limit, or exclude coverage:

The following listing identifies endorsements available to modify the Insurance Services Office (ISO) Equipment Breakdown Protection Coverage Form. It is arranged by form number and title, and it includes a brief explanation of the use of each form. This section does not include any state-specific endorsements, changes, or amendments.

FORM NUMBERING

The ten-digit numbering sequence of ISO forms and endorsements has a very specific meaning:

  • The first two entries are alphabetical characters that indicate the line of insurance involved. For example, EB denotes Equipment Breakdown.
  • The next two digits designate the specific insurance category. The numerals "15" apply to Equipment Breakdown Protection Coverage forms and endorsements.
  • The next two digits are the form or endorsement number within the insurance category.
  • The last four digits are the edition date of the form or endorsement expressed in month and year format. These digits are not used in this analysis.

Note: Endorsements previously identified as "BM" are now identified as "EB." The Equipment Breakdown Protection Coverage Form Archive lists and describes endorsements used with previous editions of this coverage form.

EB 15 39-Refrigeration Interruption Coverage

This endorsement covers the named insured's refrigerated property that spoils because lack of or excess refrigeration due to a breakdown of covered equipment that occurs at either owned or non-owned locations. It covers the expenses incurred that reduce the loss. It is subject to the insurance company receiving an annual report of values and includes a coinsurance condition that is triggered if the annual report of values is late or is not submitted at all. The coverage contains its own limit and deductible.

EB 99 51-Amendment of Declarations

This endorsement is used to change the original entries on the declarations to reflect changes in limits, coverages, deductibles, and conditions.

EB 99 52-Turbine Units Explosion Coverage

Turbine units only receive the restricted coverage described in this endorsement. The premises where located and the specific unit must be scheduled. The coverage is different, but if accepted, the premium savings is substantial.

EB 99 55-Pressure or Vacuum Equipment

This endorsement restricts coverage. It replaces the definition of covered equipment to include only equipment intended to operate under internal pressure or vacuum. This equipment must be subject to mandatory inspection by state or municipal entities that authorized insurance company inspection personnel can do.

Using this endorsement results in a lower premium because the breakdown coverage provided is so limited.

EB 99 56-Limited Coverage for Specified Equipment

This restrictive endorsement limits coverage for the scheduled described covered equipment while maintaining the broader coverage for other equipment and premises. A limit of loss, a complete description of the equipment and premises, and the number of days for business income coverage must be entered on the endorsement schedule.

This endorsement changes coverage from a blanket to a scheduled basis for the premises listed.

EB 99 57-Production Machinery Exclusion

This endorsement restricts coverage. It amends the definition of covered equipment to exclude production or process machinery and related equipment.

EB 99 58-Spare Equipment and Parts

This endorsement allows the named insured to separately cover spare parts and equipment that are not functioning or that are not available for use. Such property is subject to the details entered on the endorsement schedule. This lets the named insured fully cover equipment and parts that are important to its operation while still providing some limited coverage for spare equipment and parts.

The endorsement must be read carefully to be certain that all scheduling matches the endorsement's wording.

EB 99 59-Actual Cash Value

This endorsement changes the Property Damage Valuation from replacement cost to actual cash value. It may be limited to only damage at scheduled premises and/or caused by scheduled equipment.

Because this is a restricting endorsement, any scheduling must be very specific in order to eliminate confusion.

EB 99 60-Suspension/Reinstatement of Coverage

This endorsement immediately suspends coverage on any equipment the insurance company considers unsafe. The suspended equipment is identified and the date on which the suspension began. The suspension can only be lifted by the attachment of this endorsement to the policy. The suspension is immediate, but equipment is not reinstated until the endorsement that reinstates coverage is issued.

EB 99 61-Valuation of Specified Property

This endorsement is used to change the valuation for the covered property listed on the endorsement schedule. The new valuation is its fair market value, reduced by any salvage obtained and labor, materials, or expenses that are not incurred in its sale.

EB 99 62-Covered Equipment Deductible Waiver

f covered equipment sustains a second loss within two years of the first loss, the deductible for the second loss is waived. The waiver is for the equipment only. The waiver does not apply to any related property damage. In addition, if the deductible for the first loss is less than the deductible for the second loss, only the amount of the first deductible is waived.

EB 99 63-Off-Premises Equipment Coverage

This endorsement extends coverage to apply to damage to covered property caused by equipment that is taken off premises. As a condition of coverage, the equipment must be at a fixed location, be ready for use, and under the named insured's control.

EB 99 64-Optional Valuation Coverage

This endorsement replaces paragraph (1) of the Valuation condition but only for equipment that is less than five years old. It allows the named insured to replace equipment that is considered a total loss with equipment that is equivalent in purpose instead of the same kind of equipment. The insurance company pays only actual cash value if the equipment is not replaced. This allows the named insured to carry a lower amount of coverage on equipment that it will not replace with identical equipment. This might be particularly useful with rapidly-changing-technology-type-equipment such as computers and communication equipment.

EB 99 65-Product Withdrawal Coverage

This endorsement covers expenses related to the withdrawal of defective products.

EB 99 66-Solidification Coverage

This endorsement covers the damage that occurs because items solidify following a covered breakdown. It does not cover the loss of value to the solid item, just the damage caused when it occurs.

Examples are molten metal that cools and adheres to processing equipment or concrete that hardens and adheres to a mixer when agitation stops.

EB 99 67-System Installation Coverage

Installing some equipment can take many months. This endorsement covers damage to equipment while it is being installed and during testing. It also covers loss of income because of such damage. Optional coverages are available, based on entries on the endorsement schedule. Once the installation is complete, this equipment's value should be added to the policy's per breakdown coverage.

Equipment Breakdown Protection Insurance - The Bottom Line

To find out exactly what type of equipment breakdown protection insurance you need and how much coverage you should have, speak to an insurance broker that is experienced with commercial property insurance to go over your options.

Types Of Small Business Insurance - Requirements & Regulations

Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.

Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.

Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.

Small Business Information

Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.

Small Business Insurance Information

In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.

The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.

Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.

According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.

Types Of Small Business Insurance

Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:

  • What type of business am I running?
  • What are common risks associated with this industry?
  • Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
  • Does my state require me to carry this type of insurance?
  • Does my lender or do any of my investors require me to carry this type of policy?

A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:

Business Insurance Policy Type What Is Covered?
General Liability InsuranceWhat is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.
Workers Compensation InsuranceWhat is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.
Product Liability InsuranceWhat is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.
Commercial Property InsuranceWhat is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.
Business Owners Policy (BOP)What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.
Commercial Auto InsuranceWhat is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.
Commercial Umbrella PoliciesWhat is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.
Liquor Liability InsuranceWhat is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.
Professional Liability (Errors & Omissions)What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.
Surety BondWhat is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).


Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.

Business Insurance Required by Law
Small Business Commercial Insurance

If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.

Your insurance agent can help you check applicable state laws so you can bring your business into compliance.

Other Types Of Small Business Insurance

There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:

  • Business Interruption Insurance
  • Commercial Flood Insurance
  • Contractor's Insurance
  • Cyber Liability
  • Data Breach
  • Directors and Officers
  • Employment Practices Liability
  • Environmental or Pollution Liability
  • Management Liability
  • Sexual Misconduct Liability

Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.

Also learn about small business insurance requirements for general liability, business property, commercial auto & workers compensation including small business commercial insurance costs. Call us (855) 767-7828.

Additional Resources For Commercial Property Insurance

Read up on small business commercial property insurance, including how business property insurance protects your company's building's and/or their contents from damage, destruction, theft and vandalism.


Commercial Real Estate Insurance

Rental property owners, real estate developers and property managers should keep an accurate survey of each property they own or that is in their care. This survey should include inventories of furnishings and equipment at those properties. These documents establish the extent of their insurable interest, facilitate the arrangement and placement of insurance and minimize controversy and confusion if a loss occurs.

Insurance coverage on property, general liability and professional or errors and omissions liability should be arranged and placed for every real estate and rental property risk.

The main goal of any commercial property insurance program is to protect the insured's real and business personal property. Buildings and their contents property usually represents a significant portion of its total assets, regardless of the size of the business. A commercial property program can provide the coverage you need if a loss should occur.

The ISO Commercial Property Building and Personal Property Coverage Form is an insurance industry standard that provides this needed coverage. As a result, it should always be reviewed and used as a benchmark for comparison when evaluating any commercial property coverage form.

This policy treats business personal property as more than just the contents of a building. When there is a limit of insurance on the declarations, property can be covered if inside the building or structure or within 100 feet of the building or premises and either in the open, or even in or on a vehicle.

There are many endorsements available to tailor the ISO Commercial Property Coverage Forms. Some are mandatory for all policies while others are mandatory for specific classifications and types of business. Others are optional and permit a standard form to be customized to meet a specific risk's coverage needs. Endorsements broaden, restrict, delete, modify, or add coverage.

These policies can provide the following additional coverages for small specific limits of insurance: debris removal, preservation of property, fire department service charge, pollutant clean up and removal, increased cost of construction and electronic data.

Minimum recommended small business insurance coverage: Building, Business Personal Property, Business Income and Extra Expense, Employee Dishonesty, Money and Securities, Accounts Receivable, Computers, Signs, Valuable Papers and Records, General Liability, Employee Benefits, Umbrella, Hired and Non-owned Auto & Workers Compensation.

Other commercial insurance policies to consider: Earthquake, Equipment Breakdown, Flood, Computer Fraud, Forgery, Contractors' Equipment, Fine Arts, Cyber Liability, Employment-related Practices, Automobile Liability and Physical Damage, and Stop Gap Liability.


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