Boiler and Machinery Insurance
Boiler and machinery insurance, sometimes referred to as "equipment breakdown" or "mechanical breakdown coverage," provides coverage for the accidental breakdown of boilers, machinery, and equipment. This type of coverage usually will reimburse you for property damage and business interruption losses. For example, this coverage would cover fire damage to computers. How Does Boiler and Machinery (BM) Insurance Work? Equipment breakdown insurance, which is traditionally known as boiler and machinery (BM) insurance, provides coverage for damage or loss resulting from unexpected mechanical breakdowns, electrical power surges, or other qualifying types of failure. It will pay to repair or replace the covered equipment or machinery, and it also generally covers ensuing property damage and business interruption costs, including lost income and extra operation expenses. Equipment breakdown insurance can help pay to repair or replace the freezer and grill, to rent the additional freezer, and to cover the lost income until the restaurant can open again – all up to the coverage limits. This coverage can be added to a commercial property insurance policy, a business owner’s policy (BOP), or a commercial package policy (CPP). It can also be obtained as a stand-alone policy. When a claim occurs, the process typically involves an investigation by the insurance company to determine the cause of the equipment failure and the extent of the damage or loss. The policyholder may need to provide documentation, such as repair invoices or proof of lost income, to support their claim. What Doesn’t Boiler and Machinery (BM) Insurance Cover? While equipment breakdown insurance is designed to protect businesses from financial losses related to sudden, internal breakdowns, there are some types of losses that are typically excluded from coverage. Here are some of the most common exclusions that may apply to this type of coverage: Wear and tear. Most policies exclude damage resulting from normal wear and tear, as this…