The unfortunate truth is that most companies don’t put too much effort into thinking about their insurance, until they need it of course. One of the often overlooked portions of a comprehensive insurance program is equipment breakdown coverage, which is a subset of business property insurance coverage.
This type of insurance covers the physical assets of your business and the building contents. Items covered would include furniture and equipment, inventory, and supplies. Here again, you might not necessarily realize the importance of having this type of coverage until a key piece of equipment breaks down. Then you have to scramble to get it back up and running again or try to find another solution. In addition to the unsatisfied customers you will have, here are just a few examples of the hard-cash outflows that an uncovered equipment breakdown can cost your business:
- Lost Revenue: Your business is missing out on an opportunity to maximize its revenue potential when your equipment isn’t working. Even when the equipment has been fixed, you might never be able to make up for the lost revenue.
- Unproductive Employees: Employees who are not performing their assigned function are not contributing to the company’s overall revenue. They might be idle, spending time trying to find parts, or using precious business hours to schedule repair or replacement for the broken equipment.
- Delay in Parts Delivery: It can be difficult to get parts delivered quickly, depending on where the equipment was originally manufactured. If your equipment is a bit older, the parts challenge gets even harder.
- Cost of Repair Services: It can be hard to get a repair service to show up in a timely manner, and can be even more expensive for an emergency repair request. The delay and costs can be extensive if the piece of equipment requires a technician skilled in a particular process.
- Lost Inventory: Businesses that deal in goods that can spoil will lose even more revenue if they are not able to process the available inventory in a timely manner.
- Safety Issues: Employees could be injured by malfunctioning equipment.
- Environmental Concerns: The equipment breakdown could lead to the release of harmful substances into the air or water source.
- New Equipment: When the breakdown is major, there will be extensive costs and delays involved in procuring new equipment, and having it delivered and installed.
The best way to protect your company and try to minimize the financial impact is to have a comprehensive insurance package that includes equipment breakdown coverage.
About Haughn & Associates
Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.