What is equipment breakdown coverage? How does that work?
What is equipment breakdown coverage? Homeowners insurance protects your home and belongings against unexpected events like fire, theft, and natural disasters. However, standard policies often do not cover household appliances’ and home systems’ mechanical or electrical failures. This is where Equipment Breakdown Coverage (EBC) comes in.
What Is Equipment Breakdown Coverage?
Equipment Breakdown Coverage is an optional add-on (endorsement) to homeowners insurance that covers sudden and accidental mechanical, electrical, and pressure system failures of appliances and home systems. It helps homeowners repair or replace essential equipment that stops working due to internal malfunctions rather than external perils like fire or water damage.
Unlike a home warranty, which typically covers wear and tear, EBC specifically protects against unexpected mechanical or electrical breakdowns, making it a valuable addition to a homeowners policy.
What Does Equipment Breakdown Coverage Include?
EBC typically covers:
1. Major Home Systems
- HVAC Systems – Central heating and air conditioning units, furnaces, and heat pumps
- Electrical Systems – Circuit breakers, panels, and wiring (if damaged by an internal failure)
- Plumbing Systems – Water heaters, boilers, and well pumps
2. Household Appliances
- Kitchen Appliances – Refrigerators, ovens, dishwashers, and microwaves
- Laundry Machines – Washing machines and dryers
- Other Home Electronics – Televisions, computers, and home security systems
3. Smart Home Technology
- Home automation systems
- Smart thermostats
- Home security and monitoring systems
4. Backup Power Systems
- Generators
- Solar energy systems (if they malfunction due to a covered failure)
5. Specialty Equipment
- Pool and spa equipment
- Home elevators and chair lifts
- Deep well or sump pumps
What Isn’t Covered?
While EBC is comprehensive coverage, it does not cover:
- Normal wear and tear or aging of equipment
- Improper maintenance or installation issues
- Cosmetic damage (e.g., scratches or dents)
- Losses covered by a manufacturer’s warranty
- Equipment damaged by external events like fire, flood, or natural disasters (these are covered under standard homeowners insurance)
How Much Does Equipment Breakdown Coverage Cost?
Adding EBC to a homeowners policy is relatively affordable, typically ranging from $25 to $50 per year for $50,000 or more in coverage. The deductible is usually $250 to $500, much lower than typical homeowners insurance deductibles.
Is Equipment Breakdown Coverage Worth It?
EBC is worth considering if you:
✔ Own expensive appliances and home systems that would be costly to replace
✔ Rely on HVAC systems, water heaters, or smart home technology
✔ Want coverage beyond a home warranty, which often has limitations and exclusions
✔ Prefer a single, comprehensive policy rather than multiple warranties for different appliances
Final Thoughts
Equipment Breakdown Coverage provides a layer of financial protection for homeowners by covering costly repairs and replacements due to unexpected mechanical or electrical failures. A small premium can save thousands of dollars in repair or replacement costs. Before adding EBC, review your current homeowner’s insurance policy, compare coverage options, and determine if it fits your needs.
Would you like to learn more about how this coverage could benefit your home? Contact your insurance provider for details! Contact us today at (541) 318-8835 or click here for a quote!
