Equipment Breakdown Coverage
Definition:
Insurance that covers the sudden failure of mechanical or electrical systems.
Explanation:
This coverage extends to appliances, heating and cooling systems, and other equipment not usually covered under a standard policy. It can often be added by endorsement.
Example:
If your furnace breaks down due to a mechanical failure, equipment breakdown coverage may pay for replacement.
Why it matters:
This term affects how claims are handled and what payout a homeowner may receive.