My Queue

There are no Videos in your queue.

Click on the Add to next to any video to save to your queue.

There are no Articles in your queue.

Click on the Add to next to any article to save to your queue.

There are no Podcasts in your queue.

Click on the Add to next to any podcast episode to save to your queue.

You're not following any authors.

Click the Follow button on any author page to keep up with the latest content from your favorite authors.

Growth Strategies

Broken Promises

Breakdown insurance can assure a quick fix.
Magazine Contributor
2 min read

This story appears in the June 2004 issue of Entrepreneur. Subscribe »

It's an old type of insurance with a new name and a growing need: Equipment breakdown insurance (traditionally called boiler and machinery insurance) has become an important part of a sound risk management strategy for all types of companies.

Historically, this specialty insurance covered boilers and production machinery, explains Mark MacGougan, assistant vice president for product development with Hartford Steam Boiler Inspection and Insurance Co. in Hartford, Connecticut. However, says MacGougan, the term equipment has come to mean much more than that, ranging from telecommunications systems to cash registers: "The way technology has evolved, just about every business is more dependent on equipment than they were even five or 10 years ago."

The policy can also cover related property damage, lost business income and other costs incurred due to the breakdown. MacGougan points out that, for many companies, the cost of lost business due to a breakdown is much more than the cost of repairing the equipment. Covered hazards range from electrical-related damage to mechanical breakdown.

An increasing number of small-business insurance policies include equipment breakdown coverage, but many still do not. Read your policy, or check with your agent to see if you're covered. If you're not, or if the coverage is insufficient, shop for a different package; or consider a stand-alone policy.

Jaquelyn Lynn is a freelance business writer in Orlando, Florida.

More from Entrepreneur

David provides constructive insight to help businesses focus on their company growth, build brand awareness and know when and how to raise money.
In as little as seven months, the Entrepreneur Authors program will turn your ideas and expertise into a professionally presented book.
Create your business plan in half the time with twice the impact using Entrepreneur's BIZ PLANNING PLUS powered by LivePlan. Try risk free for 60 days.

Latest on Entrepreneur