What Is Home Equipment Breakdown Coverage?

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Out of all of the belongings you keep inside your home, your appliances and home systems are easily among the most expensive. They are also subject to loss and repairs. While your home insurance may protect appliances from outside perils such as lightning or windstorms, the most common risks like power surges or mechanical breakdowns (those that happen within your home) are not covered. This is where home equipment breakdown coverage comes into play. 

What Does It Cover

Home equipment breakdown coverage can be quite extensive. It covers: 
  • AC systems 
  • Water heaters 
  • Security systems 
  • Sump pumps
  • Steam boilers 
  • Dishwashers 
  • Garbage disposals 
  • Refrigerators 
  • Ovens
  • Washing machines 
  • Dryers 
  • Computer systems 
  • Riding lawn mowers 
  • Media systems 
  • PCs and laptops
  • Pool filtration systems 
  • Vacuum systems 
  • Among others 
In terms of monetary costs and losses, your insurance will help you cover things like:
  • The cost to repair or replace the equipment 
  • Cost of food spoilage 
  • Expedited repairs costs (for pieces of equipment are crucial and need to be fixed as soon as possible) 
  • Extra expenses such as temporary living expenses if you are unable to stay home during repairs. 

When Does It Come Into Effect

  • Motor burnouts
  • Power surges 
  • Short circuits 
  • Pressure systems breakdown 
  • Among others 
It won’t, however, cover damages caused by wear and tear. You are held responsible for making sure that your equipment is maintained correctly. Think of it this way: If the damage could have been prevented through maintenance, or if it’s something that was foreseeable, the insurance company won’t pay for it. 
Therefore, make sure to have your home systems checked regularly, and have someone take a look as soon as you notice they are not performing as usual. This will ensure you stay on the right side of your insurance coverage. 

How Much Can It Cost?

Home equipment breakdown coverage is not hard to obtain, and it doesn’t cost as much as you would think. Getting a policy is usually as simple as adding an endorsement to your home insurance (this means adding an extra feature for an additional price). 
While prices can vary, adding equipment breakdown coverage for your home can cost an additional $20 to $50 a year. This is not much when you consider that fixing a refrigerator, for example, can cost around $300. Now, imagine the cost if a power surge takes out multiple types of equipment simultaneously. That extra $50 a year doesn’t seem so bad now, right? 

Equipment Breakdown Coverage vs. Home Warranty

Many people have a hard time differentiating between equipment breakdown coverage and a home warranty. They do have some similar aspects, but one can be part of your home insurance policy, and the other one is a separate service that you get for your home. 
Home warranties cover specific equipment in your home (they sometimes work by areas, such as kitchen equipment only, for example), and in case of a breakdown, you can contact your plan provider to come to your house and fix the appliances for you. They are a service contract for your home. 
However, home warranties are often much more expensive than equipment breakdown coverage, with prices ranging around $500 annually. And, they can also have some extra costs associated with the repairs, such as deductibles and service visits fees. 
Therefore, equipment breakdown coverage is an excellent option if you want that extra layer of security for your home equipment but want to save some money at the same time. 

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