Boiler and machinery insurance (also known as Equipment Breakdown Insurance) is coverage that provides protection for businesses against financial losses resulting from the failure of equipment, machinery, or systems.
Additional Considerations
Coverage for Equipment Breakdown: Boiler and machinery insurance covers the cost of repairing or replacing various types of equipment, including boilers, heating and cooling systems, electrical systems, machinery used in manufacturing processes, and other mechanical systems. It applies to situations where the breakdown is caused by mechanical failure, electrical malfunction, pressure vessel rupture, or other sudden and unforeseen events.
Property Damage: In addition to repairing or replacing the damaged equipment, this insurance can also cover damage to other property or structures resulting from the equipment breakdown. For example, if a malfunctioning boiler causes a fire that damages a building, the insurance may cover the repair or replacement of the building as well.
Business Interruption Coverage: Some boiler and machinery insurance policies also include coverage for business interruption losses. This means that if the equipment breakdown leads to a temporary shutdown of the business, the policy may provide compensation for lost income, extra expenses incurred during the downtime, and ongoing operating expenses.
Loss Mitigation
Expenses for Inspection and Preventive Measures: Some policies may cover the costs associated with inspections, maintenance, and preventive measures to reduce the risk of equipment breakdown. This proactive approach can help businesses identify and address potential issues before they lead to major breakdowns.
Coverage for Extra Expenses: In the event of equipment breakdown, businesses may incur extra expenses such as renting replacement equipment or relocating operations temporarily. Boiler and machinery insurance can cover these additional costs.Types of Businesses Covered: Boiler and machinery insurance is relevant for a wide range of businesses, including manufacturing companies, commercial properties, hospitals, schools, and more. Any organization that relies on critical equipment and machinery can benefit from this type of coverage.
Risk Management: Insurers often work with businesses to assess their risks and provide guidance on risk management practices. Implementing safety protocols and maintenance routines can help reduce the likelihood of equipment breakdowns.
Are you looking to buy another company? Folding its property, customers and employees into your organization is no small feat. Even if you plan to keep it as a subsidiary, you need to do full due diligence on the insurance aspect of the deal. This rundown can help you prepare so your transaction doesn’t fall through or saddle you with regret.
Cyber insurance provides more than just financial recovery, offering risk mitigation tools like incident response planning, breach response services, cybersecurity training, and pre-breach assessments to help businesses prevent and manage cyber threats. However, coverage for global operations, biometric privacy claims, and newly acquired entities varies by policy, so businesses must carefully evaluate their plans to ensure they receive both proactive security support and financial protection.
For real estate and property management clients, balancing the cost-saving benefits of higher insurance deductibles with lender requirements can be challenging. Strategies such as deductible buy down policies, indemnity agreements, and reimbursement policies help insureds reduce premiums while meeting lender expectations. Additionally, effective collateral management, including alternatives like letters of credit and third-party trust arrangements, is critical for clients navigating the increasing costs and evolving requirements of loss-sensitive insurance programs.
Request a Risk Assessment today!