Do I need equipment breakdown coverage?

You likely have more costly appliances, equipment and electronic devices in your home now than ever before. Smart technology, security systems and connected homes are part of everyday life for many homeowners. More people have set up home offices and will continue to work remotely, and others upped their home workout game with the purchase of expensive gym equipment during the pandemic. Modern technology makes our homes more comfortable, keeps your household running efficiently and makes life more fun.

But when sophisticated equipment that you heavily rely on breaks down, your entire life can grind to a halt. Repairs are almost always inconvenient and usually expensive. Replacing or repairing your appliances and devices is costly. What if your homeowners policy can help with that?

Sounds too good to be true, right? Not if you have equipment breakdown coverage on your homeowners insurance policy. An equipment breakdown coverage endorsement added to your homeowners policy protects against certain mechanical and electrical breakdowns in your home.

What is covered under an equipment breakdown endorsement?

Equipment breakdown coverage protects many common household items and systems from mechanical, electrical and pressure systems breakdown. Here’s a list of what’s typically covered:

• HVAC systems
• Electrical systems
• Security systems
• Smart home monitoring devices
• Refrigerators
• Personal computers
• Washers and dryers
• Water heaters
• Pool and jacuzzi equipment
• Home electronics, including computers
• Garden tractors
• Well pumps and more

In addition to covering mechanical items, an equipment breakdown endorsement includes other benefits. Coverage to expedite repairs, spoilage coverage for the loss of perishable goods, pollutant cleanup and removal, coverage for the equipment if the repair needs taken care of off your property, additional living expenses, and safety, efficiency and environmental improvements can all be provided for under equipment breakdown coverage.

Is equipment breakdown coverage expensive?

An equipment breakdown endorsement to your policy typically increases your premium by less than $10 a month and provides $100,000 of coverage (subject to a $500 deductible) for each covered equipment breakdown.

Isn’t the equipment inside my home already covered?

Many homeowners mistakenly believe their appliances and home systems are covered for mechanical and electrical breakdown under their standard homeowners policy or a warranty.

Homeowners insurance policies
Homeowners policies protect against sudden and fortuitous losses usually from external perils, such as weather events, natural disasters, fire and theft. Typically, there are exclusions for direct loss of property due to mechanical and electrical failure.

Home warranties
Home warranties are expensive, and they only cover specific items up to very limited amounts (such as $2,000) for failure due to normal wear and tear. Even requesting service often comes with a fee.

Manufacturer warranties
Manufacturers’ product warranties might only cover products for a certain period, not the entire lifetime, and are often only pertinent to specific defects. They can also easily be voided.

What is not covered by an equipment breakdown endorsement?

Equipment breakdown coverage does not apply to equipment breakdown caused directly by perils such as the following:

• Wear and tear
• Rust or other corrosion
• Hidden or latent defect
• Mold
• Smog
• Settling or cracking
• Nesting or infestation of birds, rodents or other animals
• Processing of data by any computer system
• Scratching and marring
• Any other peril covered under the base homeowners policy

Maintaining your equipment with regular checks by trained technicians is the best way to keep things running smooth and reduce the chance of breakdowns.

What are some examples of losses that would be covered under an equipment breakdown endorsement?

A home’s hot water heater suddenly burst and requires replacement. Upon inspection, it is determined that the water heater was well within its useful lifespan and showed no signs of unusual wear and tear, corrosion or defect. As a result, the cost to replace the water heater with a new one with the same capacity, but more energy effective, would be covered.

A homeowner’s high-end amplifier used for his home theater system suddenly stops working. A technician has determined that the home theater has suffered an electrical failure due to a power surge not caused by lightning. As a result, the cost to replace the damaged electrical components to bring the amplifier to its pre-loss condition would be covered.

Equipment breakdown coverage provides an easy and cost-effective way to protect your home’s valuable equipment against mechanical, electrical and pressure system breakdowns. It’s a smart solution to bridge the coverage gaps of standard homeowners policies and other warranties.

Talk to your insurance representative today to find out about available equipment breakdown coverage options. Protect your home with just a few extra dollars added to your monthly premium.

_{No coverage is provided by this summary, nor can it be construed to replace any provision of your policy. You should read your policy for complete information on the coverages you are provided. If there is any conflict between the Policy and this summary, THE PROVISIONS OF YOUR POLICY SHALL PREVAIL.}