Stay out of the cold with homeowner equipment breakdown coverage

BY ADAM CULLER

Losing power due to inclement weather often tops many homeowners’ lists of worstcase scenarios during the dead of winter.

But when critical household systems break down without warning in the colder months, homeowners typically face similar dilemmas to those caused by unexpected power outages.

“As much as we would like them to, HVAC systems won’t last forever,” said Lisa Whitus, personal and commercial lines underwriting manager for Virginia Farm Bureau Mutual Insurance Co.

“If your heating system breaks down and you’re not financially prepared, you could be looking at a real issue between the repair costs and having to scramble to keep your house warm while you come up with the money to fix that system.”

Whitus explained that repairing and replacing HVAC systems may costs tens of thousands of dollars in some cases, an undertaking many homeowners cannot afford. While breakdowns caused by fire or certain weather events are covered under most standard homeowner policies, common losses caused by electrical and mechanical failure or neglect are not.

Not limited to HVAC systems, homeowners can endorse their policies with equipment breakdown coverage, which also protects policyholders from sudden failures on plumbing and electrical systems, as well as appliances and other household items.

Equipment breakdown coverage is designed to pick up where standard coverage leaves off. It covers electrical and mechanical breakdowns and failures that occur inside the endorsed equipment. The endorsement also protects homeowners’ wallets from the staggering repair rates that generally follow losses caused by faulty equipment.

Coverage can be purchased on a wide range of equipment, including air conditioning and electrical distribution systems, furnaces and heat pumps, kitchen appliances, and water heaters and water treatment systems.

Electronics, solar energy systems, gym equipment, health monitoring systems and tools also can be endorsed.

“Equipment breakdown coverage provides excellent value to policyholders because the coverage is relatively inexpensive, especially when you compare it to the outright cost of repairing or replacing appliances and full home systems,” Whitus added.

“Your insurance policy is in place to protect you from catastrophic loss, and losing your entire heating, plumbing or electrical system certainly qualifies.”

Protecting commercial buildings

Equipment breakdown coverage also may be purchased through business owner policies, sometimes referred to as BOP.

Because commercial buildings vary in size and usually are larger than homes, they may be outfitted with commercial-scale equipment or multiple units. The large size further increases the price of fixing and replacing faulty equipment.

To best cover your building’s assets, purchasing equipment breakdown coverage is highly advisable.

“If you own commercial property like an office building or a retail store, this endorsement covers a building’s regular systems— your central air unit, your heat pump or hot water heater—just like it would on a homeowner policy,” Whitus noted. “If you’re just a tenant in a building, unless your lease makes you responsible for certain equipment, you’d have no need for this coverage.”

To learn more about equipment breakdown coverage, visit vafb.com/ equipment-breakdowncoverage or call your Farm Bureau agent.