8 Reasons Why You Need Equipment Breakdown Insurance

1. Equipment You Depend On
   Car Washes depend on environmental heating and cooling systems and electrical equipment. Yet this equipment is subject to sudden and accidental breakdown caused by:
   • Power ling surges
   • Improper start-up
   • Insulation failure
   
    
2. What’s More likely: An Equipment Failure or a Fire?
   Ask yourself: What’s more likely: a power surge that damages electrical equipment or a major fire? You’re probably adequately insured for fire. Shouldn’t you insure for what’s more likely to occur?
   
   
3. Equipment Breakdown Insurance Covers More Than Just Repair Costs
   Equipment Breakdown Insurance helps protect you from the costs associated with losses to your building’s equipment. It pays for:
   • Costs to repair or replace equipment damaged by breakdown
   • Other costs or expenses to limit the loss or speed business restoration.
   • Business income loss (when coverage is selected).
   
    
4. Protection for Many Types of Equipment
   Equipment Breakdown Insurance covers many types of equipment that Car Washes typically have:
   • Electrical equipment like electronic controls
   • Mechanical equipment like motors and generators
   • Modern office equipment like phone systems
   • Heating systems and boilers
   • Air conditioning and refrigeration systems including fans and blowers
   
    
5. Mandatory Inspections
   Most states and many local governments require that boilers or pressure vessels be inspected by commission inspectors. With HSB providing these inspection services, you can avoid local inspection fees in a majority of jurisdictions. Only the certificate fee would be your responsibility.
   
    
6. Complements Your Property Insurance
   Property insurance does cover equipment for standard perils, such as fire. However, property insurance isn’t designed to cover the causes of equipment failure. You need Equipment Breakdown Coverage for hazards such as:
   • Short circuits
   • Electrical arcing
   • Motor burnout
   • Mechanical Breakdown and others
   
    
7. Losses Can Be Costly
   When equipment fails, it often leads to a variety of unanticipated expenses. To assess the value of Equipment Breakdown Insurance, consider the following:
   • Investment in electrical equipment and machinery
   • Income for the period you have to shut or slow down because a breakdown interrupts business.
   • Extra expenses you may incur to rent spares or rush repairs.
   It adds up doesn’t it? Considering what’s at stake, every business needs Equipment Breakdown Coverage. Additionally, the Travelers policy has added the benefit of eliminating any hourly deductible and including coverage for direct damage to underground piping.
   
    
8. Typical Losses
   Equipment breakdown is not infrequent. Here are some loss examples for Car Washes. They were glad they had Equipment Breakdown Insurance!
   
   • The conveyor system broke down, repairs took four days Total loss: $4,397
   • Loss was to a copper finned hot water heating boiler. High limit (temp) switch failed, boiler overheated, tubes ruptured. Total loss: $5,657
   • Tow 20 HP motors used for the automated section of the car was were damaged beyond repair due to a power surge. Total loss: $15,000

For information on the NECA insurance program for its members, please click here.