Equipment Breakdown Coverage Explained
What is Equipment Breakdown Coverage?
Imagine this: You wake up one morning, stumble into the kitchen, press the button on your coffee maker—and nothing happens. You try again. Still nothing. Then, you notice your fridge isn’t humming. Your AC? Not working. In a moment of panic, you realize something more significant might be at play. This is where equipment breakdown coverage steps in.
Simply put, equipment breakdown coverage is an optional endorsement that may be added to certain homeowners insurance policies. It protects you from unexpected failures of essential home systems and appliances due to mechanical, electrical, or pressure-related issues. Think of it as an added safety net when your home’s vital systems unexpectedly fail—not because of age or wear and tear, but due to an unforeseen malfunction.
What Does Equipment Breakdown Insurance Cover?
This type of coverage depends on the carrier and policy but typically includes:
- HVAC Systems – Air conditioners, furnaces, boilers, and heat pumps.
- Electrical Systems – Circuit breakers, home wiring, generators, and smart home tech.
- Major Appliances – Refrigerators, washing machines, dryers, ovens, and dishwashers.
- Water Heaters & Plumbing Systems – Sudden malfunctions that aren’t due to old age or gradual deterioration.
- Electronics – Televisions, computers, and home entertainment systems (depending on your policy).
- Well Pumps & Home Elevators – If applicable, coverage can extend to specialized equipment like well pumps or even home elevators.
What’s Not Covered?
Equipment breakdown coverage isn’t a blanket policy for every household issue. It won’t cover:
- Normal wear and tear or aging appliances
- Cosmetic damages (scratches, dents, etc.)
- Improper installation or maintenance neglect
- Damages covered by a manufacturer’s warranty
In other words, if your ten-year-old refrigerator stops working because it’s simply reached the end of its lifespan, this coverage won’t help. However, if a power surge fries the internal circuitry? That’s when it steps in.
How is Equipment Breakdown Coverage Different from a Home Warranty?
People often confuse equipment breakdown coverage with a home warranty, but they’re not the same. A home warranty is typically a service contract that helps with repairs or replacements of appliances and home systems due to normal wear and tear. Equipment breakdown coverage, on the other hand, is an insurance add-on that protects against sudden, accidental failures caused by electrical or mechanical breakdowns.
Another key difference? Home warranties often require homeowners to use designated service providers, whereas equipment breakdown coverage allows for more flexibility in repair choices.
Is Equipment Breakdown Coverage Worth It?
That depends on your situation. Here’s a thought experiment: If your central AC unit failed tomorrow due to an electrical surge, would paying for a new one be a financial burden? If so, having this coverage could be a game-changer.
For just a small addition to your homeowners insurance policy, equipment breakdown coverage can save you from costly, unexpected repairs. While costs vary, most policies range from $25 to $50 per year, making it a relatively low-cost safeguard.
The Bottom Line
Equipment breakdown coverage can provide peace of mind if you rely on modern appliances and systems to keep your home running smoothly. It’s not meant to replace standard homeowners insurance but rather to fill in the gaps, ensuring that when the unexpected happens, you’re not stuck footing a hefty bill.
Not sure if this coverage makes sense for your home? That’s where we come in. At TGS Insurance Agency, we help homeowners like you find the right coverage to protect what matters most. Contact us today, and let’s make sure you’re covered for the unexpected.