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MACHINERY BREAKDOWN INSURANCE THAT KEEPS YOU RUNNING
Why Machinery & Equipment Breakdown Cover Matters
In engineering and manufacturing, a single machine failure can stop production instantly. When a critical asset goes down — such as a CNC machine, press, compressor, chiller, packaging line, boiler, conveyor, injection moulding unit, laser cutter, or automated production cell — you can face repair bills, emergency call-outs, damaged stock, missed delivery dates, and contract penalties. Standard property insurance typically focuses on perils like fire, flood and theft. Machinery breakdown (sometimes called engineering breakdown or equipment breakdown insurance) is designed to cover sudden and unforeseen mechanical or electrical failure.
Insure24 arranges bespoke machinery and equipment breakdown policies for UK engineering manufacturers, covering everything from individual key machines to entire production lines — and integrating breakdown cover with business interruption, deterioration of stock, hired-in plant and associated liabilities where needed.
What Does Machinery & Equipment Breakdown Insurance Cover?
Policies can be tailored, but equipment breakdown cover is generally designed around the costs you face when machinery suffers sudden internal damage, electrical fault, or other breakdown that halts operations. The key is that the loss is not due to gradual wear and tear alone, but a sudden, unexpected event that causes the machine to fail.
Core Breakdown Cover
- Repair or replacement of insured machinery following sudden mechanical or electrical breakdown
- Emergency call-out and labour costs (subject to policy terms)
- Parts and materials required to restore the machine to working condition
- Overtime / express freight to speed up repairs and minimise downtime (optional on many policies)
- Electrical arcing / short circuit and motor burnout (where covered)
- Hydraulic / pneumatic failure and internal component damage
- Control systems and PLC-related breakdown (depending on equipment and insurer)
Downtime & Consequential Loss Options
- Business interruption following breakdown (loss of gross profit / revenue during downtime)
- Increased cost of working (e.g., outsourcing, temporary equipment, overtime, alternative premises)
- Deterioration of stock (e.g., chilled / frozen goods, temperature-sensitive materials)
- Loss of utilities caused by insured breakdown (e.g., compressor / chiller / transformer failure)
- Contractual penalties (sometimes available via extensions, or managed via BI design)
- Project delay risk for time-sensitive bespoke jobs (structured around downtime and mitigation)
Typical Machinery & Equipment We Can Cover
Engineering manufacturers use a wide range of assets — from heavy industrial plant to precision equipment. We can help you insure individual “key machines” that would cripple production if they failed, or design a schedule to cover many assets across your site.
Production & Fabrication Equipment
- CNC machines, mills, lathes, turning centres
- Presses, brake presses, stamping and forming equipment
- Laser cutters, plasma cutters, water-jet cutting systems
- Welding machines and automated welding cells
- Injection moulding and extrusion equipment
- Packaging lines, conveyors, sortation and automation
- Robotics and robotic arms (where insurable and specified)
Utilities & Site-Critical Plant
- Air compressors, dryers, receivers and compressed air systems
- Boilers, heating plant, pumps and associated systems
- Chillers, refrigeration plant and temperature control units
- Generators, transformers, switchgear and electrical distribution
- Dust extraction, filtration and ventilation systems
- Forklift charging infrastructure and industrial power supplies
- Cranes / lifting equipment (often aligned with statutory inspection requirements)
One-Off & Bespoke Machinery Projects
If you manufacture bespoke machinery for clients, we can also help structure cover around build, testing, commissioning and handover. This can involve combining machinery breakdown with contract works, products liability, and (where you design/specify) professional indemnity — to ensure your insurance aligns with real-world risk across the project lifecycle.
Common Causes of Machinery Breakdown in Manufacturing
The purpose of breakdown cover is to protect you from sudden, unexpected faults that cause internal damage. Understanding typical failure modes helps you select the right cover, values and extensions.
Mechanical & Component Failure
Mechanical breakdown can occur with little warning: bearing failure, shaft damage, gearbox issues, pump seizure, belt/chain failure, and hydraulic system faults can instantly stop production.
- Gearbox and transmission damage
- Bearing failure and overheating
- Hydraulic hose or valve failure causing internal damage
- Pump seizure and motor coupling faults
- Compressor internal failure
Electrical Failure & Control Systems
Modern manufacturing relies on electrical and electronic systems. Breakdowns can originate from motors, drives, control panels, power supply issues, arcing, short circuit and component failure.
- Motor burnout and drive failures
- Electrical arcing / short circuit damage
- PLC / control board faults affecting automation
- Transformer and switchgear issues
- Power surge / voltage fluctuation impacts (subject to policy)
What’s Typically Not Covered (And How We Help You Avoid Gaps)
Equipment breakdown policies vary by insurer and schedule, but there are common exclusions and limitations that you should understand before you rely on the cover. The goal is not to “catch you out” — it’s to ensure the policy is structured realistically for your machinery, maintenance and operating environment.
- Wear and tear, corrosion, erosion and gradual deterioration (unless sudden damage results and is covered)
- Poor maintenance or known defects not addressed
- Consumable parts (belts, filters, tooling) often limited unless damaged by an insured event
- Pre-existing damage or faults that existed before the policy incepted
- Manufacturers’ recall and warranty issues (typically addressed separately)
- Cyber-related causes (can be addressed via cyber/technology insurance where relevant)
We’ll help you identify the real-world exposures for your plant and align breakdown cover with your maintenance routines, age profile of machinery, and how critical each asset is to production.
Risk Management Tips: Reduce Breakdowns & Improve Insurance Terms
Insurers love well-managed engineering risks. The stronger your maintenance, inspection and contingency planning, the more competitive your premiums and policy terms can be — and the lower your chance of production-stopping failure.
Maintenance & Inspection
- Documented preventative maintenance (PPM) schedules for key machinery
- Thermal imaging and vibration analysis for motors and bearings
- Oil analysis for gearboxes and hydraulic systems
- Planned replacement for known weak points and consumables
- Service records retained and available for underwriting/claims
Downtime Planning
- Identify “single point of failure” machines and plan contingencies
- Keep critical spare parts (or supplier agreements for fast delivery)
- Outsource options and alternative production routes
- Backup power strategy where voltage fluctuation risk exists
- Business continuity plan aligned to your insurance indemnity period
Why Choose Insure24 for Machinery Breakdown Insurance?
- Engineering-aware broking: We understand the difference between routine maintenance and sudden breakdown loss.
- Proper scheduling: Help valuing machinery on a replacement-as-new or indemnity basis (as required).
- Downtime-first approach: Align breakdown cover with BI, increased costs and lead times for parts.
- Contract-ready: Support for client requirements, contract clauses and evidence of insurance.
- Fast support: Practical guidance if a key machine fails and you need to act quickly.
FREQUENTLY ASKED QUESTIONS
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What is machinery & equipment breakdown insurance?
Machinery and equipment breakdown insurance covers the cost of repair or replacement when insured machinery suffers sudden and unforeseen mechanical or electrical failure. It’s designed to cover breakdown events that are not typically insured under standard property policies (which focus on perils like fire, flood and theft).
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Does it include business interruption if a key machine fails?
It can. Many policies can be extended (or combined with business interruption cover) so you can claim for loss of gross profit/revenue and additional costs incurred while the machine is repaired. The right structure depends on how quickly you can recover, lead times for parts, and whether production can be redirected to other equipment or outsourced.
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What types of machines can be insured?
Typical items include CNC machines, presses, cutting equipment, compressors, chillers, packaging lines, conveyors, pumps, motors, switchgear, boilers and other site-critical plant. Insurers may require a schedule of machinery, values, and details such as age, maintenance and usage.
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Is wear and tear covered?
Wear and tear, gradual deterioration and corrosion are typically excluded. Breakdown policies are intended for sudden and unforeseen failures that cause internal damage. Good maintenance records can help secure better terms and support smoother claims handling.
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How is the sum insured calculated for machinery breakdown?
Sums insured are usually based on replacement cost (or the basis required by the insurer). For older equipment, the valuation approach can vary by policy and underwriting. We help you set realistic values for key machines and ensure schedules match what you actually have on-site.
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How quickly can Insure24 arrange cover?
Many risks can be quoted quickly once we have your machinery details (key assets, values, age profile, maintenance and claims history). For larger or more complex engineering schedules, underwriting may take longer — but we’ll keep it moving and aim for the most competitive, appropriate terms.