Boiler and machinery insurance protects your business from financial losses and damage caused by broken equipment. It’s also known as equipment breakdown insurance.
This coverage applies regardless of how much it costs to repair or replace the equipment, ensuring that any damage and losses from equipment failures are covered.
In addition to boilers and furnaces, this insurance also covers various types of equipment, such as office machines and elevators.
It addresses all risks related to business equipment, helping to keep your operations running smoothly.
Companies choose this insurance to safeguard their equipment, just like they use liability insurance to protect their workers financially.
What Damage Does Boiler And Machinery Insurance Cover?
As mentioned earlier, this insurance covers different types of business equipment. It is designed to help companies protect the equipment they use regularly.
Boiler and machinery insurance is relevant to many industries, not just manufacturing. It is divided into five main categories, which include:
Mechanical Breakdown
This insurance covers manufacturing equipment like machines, water pumps, engines, copiers, generators, ovens, cash registers, and other machines used in business. It helps pay for repairs and replacements of this equipment.
Electrical Issues
Businesses often face electrical problems with their machinery. This insurance covers issues with transformers, short circuits, cables, and power surges.
Boilers And Equipment
It covers any valves, gauges, and boiler equipment.
Technology
This category is often chosen by technology companies. It covers issues with phones, computers, voicemail systems, security systems, and fire alarms.
Air Control
It covers HVAC systems, air conditioning units, and refrigeration equipment used by many companies. Modern technologies haven’t been around long enough to completely understand how equipment can get damaged.
However, boiler and machinery insurance is the ideal choice for any business needing specialized coverage.
What Does Boiler And Machinery Insurance Not Cover?
While this insurance is meant to protect businesses from financial losses caused by unexpected damage to their equipment, there are some types of losses it does not cover. These include:
- Corrosion and rust.
- Natural disasters like floods and earthquakes.
- Wear and tear.
- Computerized attacks.
- Deliberate acts.
Damages to your business equipment or machinery caused by fire, vandalism, theft, lightning, and other covered events are included in the boiler and machinery insurance policy.
Benefits Of Boiler And Machinery Insurance
Boiler and machinery insurance offers more than just financial help for damaged equipment. This policy helps keep the company financially stable by covering different costs and losses linked to equipment damage. Some benefits of boiler and machinery insurance include:
- Coverage for replacements and repairs of damaged equipment, including the cost of parts and labor.
- Lost income due to damaged equipment.
- Costs that are sustained due to the time taken for equipment repairs.
- Damaged inventory or replacements of perishable goods damaged due to spoilt equipment.
Thanks to these benefits, companies can succeed and bounce back more easily from the repairs and replacements of damaged equipment.
Who Should Buy Boiler And Machinery Insurance?
This insurance is important for any business that depends on electrical systems, machines, or other equipment to function.
It helps businesses recover quickly and reduces the financial impact of unexpected breakdowns. The following types of companies should think about getting boiler and machinery insurance:
- Hotels and resorts.
- Manufacturing companies.
- Food service businesses.
- Shopping centers and retail stores.
- Construction businesses.
- Health care facilities.
- Educational companies.
- Commercial buildings.
- Agricultural companies.
Businesses like these often face unexpected equipment damage, which can stop operations and cause financial problems due to repair costs.
For this reason, it’s important to invest in this insurance policy to protect your business financially.
How Much Does Boiler And Machinery Insurance Cost?
The cost of this insurance varies depending on the insurance company and several factors that affect pricing. The level of risk linked to these factors determines how much you will pay for coverage. These factors include:
- Type of business
- Equipment safety and maintenance records
- Previous claim history
- Value and age of equipment
- Coverage limits and deductibles
Each insurance company uses these factors to set the price of this insurance. If these factors pose high risks, your business may have to pay higher premiums.
Therefore, it’s important to manage these factors to qualify for lower rates.