Electrical breakdown
Equipment failure resulting from electrical breakdown is the most frequent cause of loss, accounting for 52% of all equipment breakdown claims.
Equipment breakdown
Everything breaks down eventually. But when the equipment that businesses and families depend on stops working, the effects can range from inconvenience, to loss of revenue or even business failure. Comprehensive Equipment Breakdown Coverage is a critical endorsement for any property policy.
What is equipment breakdown?
Equipment breakdown occurs when electrical or mechanical equipment stops working unexpectedly as a result of some catastrophic failure not associated with normal wear and tear. Equipment breakdown can affect commercial businesses, farming operations, as well as homeowners, and is classified into three categories or perils:
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Mechanical breakdown
Mechanical breakdown is the second most common form of equipment failure. It accounts for 36% of all equipment breakdown claims and results in 33% of loss in terms of total cost. -
Pressure systems breakdown
Pressure systems breakdown accounts for only 12% of all equipment breakdown claims. This type of loss can be highly disruptive for commercial businesses, farming operations, or homeowners when it occurs.
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Modern coverage for modern exposure
As technology advances and becomes more integrated into our everyday lives, equipment breakdown becomes increasingly disruptive. In addition, the more advanced the technology, the more complex and expensive it is to repair or replace. Most property policies don’t cover equipment breakdown. However, an equipment breakdown endorsement will protect the property identified in the underlying policy.
What’s at stake?
These charts demonstrate just how often equipment breakdown occurs, as well as the severity of costs associated with each peril.
Frequency of breakdowns
Electrical
52%
Mechanical
36%
Pressure
12%
Severity of breakdowns
Electrical
57%
Mechanical
33%
Pressure
10%
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Learn more about electrical breakdown