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Understanding Equipment Insurance vs. Equipment Breakdown Insurance

Tuesday, September 1st, 2020

No matter what kind of business you own, you probably use at least one piece of equipment to do your job each day. 

Maybe you own a landscaping company and your arsenal of tools includes lawnmowers, leaf blowers, hedge trimmers, and a variety of other equipment. Or maybe you’re a wedding photographer with cameras and camera equipment totaling tens of thousands of dollars.

Whatever your business is, you need to make sure it’s adequately protected. And usually, that includes having both equipment insurance AND equipment breakdown insurance. The problem is, business owners often conflate these two terms and they don’t realize they’re without important coverage until it’s too late.

To make sure this doesn’t happen to you, let’s talk about what both of these insurance terms mean.

Equipment insurance

Your commercial property insurance policy is responsible for providing the actual structure of your business with coverage, but also a lot of your equipment! So, if your business property (AKA equipment) is damaged by a covered peril, like a fire or theft, then this coverage could be used to replace it.

But what if your business equipment breaks down suddenly and accidentally? Does commercial property insurance cover equipment breakdowns? No–not usually! Instead, you’ll need what’s known as equipment breakdown insurance. 

Equipment breakdown insurance

If your equipment has been properly maintained but still breaks down, equipment breakdown insurance can be a gamechanger! While equipment insurance under your commercial property insurance policy can cover damage from external forces, equipment breakdown insurance can cover repair costs for breakdowns from internal causes. 

So, ask yourself if you could cover the cost of repairs for equipment breakdowns out of pocket? If not, this insurance is a great choice. 

By the way, in addition to equipment breakdown insurance, another insurance option you need to consider is flood insurance for businesses. We discuss commercial flood insurance FAQs in this post.

Commercial Insurance in Fargo-Moorhead 

For all of your commercial insurance needs in Fargo-Moorhead, give Fargo-Moorhead Insurance a call! In addition to our business insurance services, we offer comprehensive solutions for home, auto, life and health insurance, and much more.