What is Equipment Breakdown coverage?
Chances are your fraternity facility is not properly insured for equipment breakdown and may be left exposed to high costs of claims if a loss occurs.
Don’t get burned by gaps in your fire/property insurance policy!
Electrical, mechanical, air conditioning, and production equipment, as well as heating boilers and pressure vessels, are key machinery and equipment.
Accidents and breakdowns that commonly happen to these kinds of devices are not covered by most fire/property insurance policies. In fact, these policies specifically exclude mechanical breakdown, electrical arcing, or damage due to a surge of electrical power or explosion due to centrifugal force.
These are the very types of accidents that have the highest probability of happening to your equipment — and that’s not all. Typical policies do not cover explosion, cracking, or burning (overheating) of steam boilers or pipes. Uninsured gaps like these could mean big losses — and possibly financial disaster.
Equipment Breakdown coverage, previously referred to as Boiler & Machinery coverage, takes the worry out of coverage gaps, and, for a typical property, costs less than you think.
In the event of an accident or breakdown to equipment, the following will be covered:
- Air conditioning system
- Electrical system
- Telephone systems
- Fire detection and security systems
- Communication systems
- Water heaters/tanks
- Refrigeration equipment
What else is offered?
A network of inspectors will help expedite repairs to get you back online quickly.
To minimize expenses, the claim specialists can help find substitute equipment.
To help you operate your equipment efficiently, the insurance carrier offers maintenance information and reference material.
Accidental loss can (and will) happen, thus the necessity for comprehensive Equipment Breakdown coverage. However, proactive maintenance of equipment and proper loss control measures will greatly reduce the likelihood of a loss.
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How would the Equipment Breakdown coverage help protect you?
Here are some examples that would be covered under the Equipment Breakdown policy:
- A chapter house’s aluminum electrical supply bus shorted out, severely damaging electrical wires and cables. Members had to be relocated.
Property Damage: $ 118,681 Relocation Cost: $ 72,152 Total Loss: $ 190,833
- A chapter house’s air conditioning motor breaks down during sweltering temperatures. Ninety-plus degree weather necessitated setting up four rented “spot coolers.” Overtime was required to get the motor back online.
Property Damage: $83,557 Extra Expense: $16,794 Total Loss: $100,351
- The low-water fuel supply cut-off did not operate in a chapter house’s cast iron heating boiler, resulting in a low-water condition. As a result, the boiler suffered severe overheating with cracking of several sections.
Property Damage: $19,750
- A chapter house’s air conditioning tubes break because of corrosion. Refrigerant leaks into the system and damages it further.
Property Damage: $31,108
- An air conditioner motor suffers winding burnout due to failure of the bearings.
Property Damage: $29,000
- High-voltage underground cable shorts to ground, causing damage to the transformer and cutting off power to the entire chapter house.
Property Damage: $59,233 Business Income Loss: $6,776 Total Loss: $66,009
A premium indication for coverage can be obtained by contacting
Holmes Murphy Fraternal Practice
13810 FNB Parkway Suite 300
Omaha, NE 68154
Phone: (800) 736.4327, ext. 4191
Fax: (800) 328.0522