Mechanical failure
Breakdown of machinery, motors, compressors and pumps.
Business Insurance
Equipment breakdown the gap in property cover.
Property insurance covers what happens to your equipment. It does not cover your equipment simply failing.
Commercial property policies respond to external perils — fire, storm, impact. They exclude mechanical and electrical breakdown, which means a compressor that dies, a transformer that fails or a boiler that goes down is entirely outside the policy most businesses assume covers it.
What breaks, and what it takes with it
HVAC, refrigeration, boilers, electrical switchgear, production machinery and increasingly computer and telephone systems all fall within this cover. The failure itself is often the smaller part of the loss.
Spoiled stock, lost production and the cost of expediting a replacement typically exceed the repair. Good forms include spoilage and business interruption alongside the equipment itself, which is where the real value sits.
What it covers
The parts of a equipment breakdown insurance policy
Electrical failure
Transformers, switchgear, panels and electronic systems.
Spoilage
Refrigerated or perishable stock lost when equipment fails.
Business interruption
Income lost and expediting costs while equipment is replaced.
Working with us
What we do differently
We are an independent agency, so we place your equipment breakdown insurance across several carriers rather than fitting you to one company's product. That means a genuine comparison, and someone to call who is not a call centre.
- Confirm spoilage and interruption are included, not just the equipment
- List computer and telephone systems if the form allows it
- Match the interruption period to replacement lead times for key plant
Common questions
Equipment Breakdown Insurance, answered
Is this not covered by my property policy?
No. Property insurance covers external perils such as fire and storm and specifically excludes mechanical and electrical breakdown. Equipment breakdown is a separate cover.
What equipment does it cover?
HVAC, refrigeration, boilers, electrical switchgear, production machinery and often computer and telephone systems. The exact schedule varies by form.
Does it pay for lost stock?
Where spoilage is included, yes — and for many businesses that is the larger part of the loss. Confirm spoilage and business interruption are both present rather than assuming.
Related cover
Often arranged alongside this
Commercial Property Insurance
Property cover repairs the building and replaces the contents. Business interruption replaces what you could not earn while that happened — and it is usually the larger number.
Read moreManufacturers Insurance
A production line stopping costs more per day than most of the equipment on it. That is where the cover has to be strongest.
Read moreRestaurant Insurance
Kitchen fire, a walk-in that fails overnight, a slip in the dining room, and a licence to serve alcohol. A restaurant carries four different businesses worth of risk.
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