Insurable Interest

by: Aaron Whitaker

Every homeowner that has had to replace a major appliance (be it washer, dryer, refrigerator or otherwise) knows just how expensive it can be. When you need to replace these appliance before their time, it’s only adding insult to injury. That and the fact that the standard homeowners policy specifically excludes equipment breakdown. Unexpected breakdown of appliances is more than an annoyance, it can cause major financial disruption.

Equipment Breakdown, Home Insurance, Portage Home Insurance

Equipment Breakdown-

This coverage is designed to cover all mechanical, electrical, electronic or fiber optic equipment on the insured premises from losses due to sudden mechanical breakdown. It is not designed (and will not cover) losses to equipment caused by wear and tear, etc. They can also include up to 150% of coverage to allow for more efficient equipment to be installed after a loss. Most equipment breakdown coverages have a limit of $100,000 with a deductible of $500, and are settled on a replacement cost basis. The coverage generally cost about $25 annually. 

The Risk-

In the USA, intentional damage done to the electrical infrastructure is on the rise. Power sub stations and distribution sites are being tampered with at an increasingly alarming rate due to theft of the expensive equipment used to provide power to our homes and businesses. These crimes might not hit close to home, but the power blackouts and surges they cause can do significant damage to your home’s most expensive equipment.

Air conditioner, furnace, generator, appliances, security system, water heaters, pool pumps, and more are all at risk of surge or sudden mechanical breakdown. Even your lawn mower is included under sudden mechanical breakdown of equipment. Mechanical breakdown and failure or interruption of power or other utility service which occurs away from your home’s premises are both excluded from a standard home policy.

Losses from power surges originating from outside your home can result in costly repairs or replacement of equipment in the home. The likelihood of more than one piece of equipment being damaged by said surge is great, and should be taken into account.

Final Word-

Equipment breakdown is inexpensive and covers a wide range of equipment and appliances. It fills a gap in the standard home policy that many could benefit from. Take a quick walk around your house and add up the cost of replacing your appliances. Most would agree that it’s a small price to pay to add the coverage for peace of mind.

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About the author:

Aaron WhitakerAaron Whitaker joined Whitaker-LaChance in 2014 as a Personal Insurance Customer Service Representative. He brought with him extensive customer service experience from working in a retail professional camera store and computer electronic store for three years in Chicago. Aaron manages all personal insurance placement, marketing, account service and claim management. His expertise is in working with our clients to make sure their insurance program takes care of them through all the changes in life. Aaron is a graduate of Kalamazoo Home School Association and attended Columbia College in Chicago, where he studied Graphic Art Design. He is an avid photographer and enjoys fishing.

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