A resounding yes, of course! That is unless you are still operating your business like how your great grandfather used to run his business!
Many business owners has the misconception that their business risk is fully covered by purchasing a commercial property insurance, add in a cyber insurance policy to cover online malicious attacks from external threats, or even throw in a business interruption insurance policy in case the shop is damaged by fire or flood. Your commercial property insurance covers damages caused by covered external cause, such as a fire, but a Machinery and Equipment Breakdown Insurance covers damages caused by covered internal forces, such as power surges, electrical shorts, mechanical breakdowns, motor burnout or operator error..
Take for example, if you are operating a restaurant that serves walk-in & online orders, your business will suffer if electrical power is cut off due to a power surge. Loss of electricity would mean that you cannot process online orders, and the restaurant would not be able to prepare, cook, serve and sell food. Prolong power cut off can also cause food wastage due to spoilage.
In this example, equipment breakdown insurance may help pay for:
- Business income you lost while the power was out (if you are not already covered under business interruption insurance)
- The cost to repair your walk-in refrigerator and to replace a computer that were damaged by a power surge that occurred when the electricity was restored
- Costs associated with the time and labour to repair and replace your damaged equipment
- The cost to replace food inventories that has been spoilt due to power cut off