Business insurance isn’t always straightforward, and sometimes you need to get down into the nitty-gritty to understand what insurance is being offered and which one is right for you. This is especially the case with Business Insurance options like Portable Equipment and Electronic Equipment cover, so let’s take a few minutes to compare the two and get our collective heads around the difference between them.
Your Ipad may depend on it!
Electronic Equipment
This coverage protects your nominated electronic equipment against loss, damage or breakdown while they are at a specific location. The definition of these events is important, and your insurer will explain each in detail in the PDS. You’ll need to let the insurer know exactly what equipment you’re insuring; this could include your computer, iPad, phone, printers or even your till. Basically, any electronic equipment that is owned, leased or managed by your business can be insured here, but it must be noted with the insurer and detailed in your insurance schedule.
There are a couple of types of cover within this option that you’ll need to choose from:
- BREAKDOWN – electrical or mechanical failure arising from internal defects which requires repair or replacement
- RESTORATION OF ELECTRONIC DATA – coverage for the discs, tapes or devices used to store data in a computer or electronic device
- INCREASED COST OF WORKING – the additional costs incurred by you to prevent a reduction in your turnover as a result of the equipment breakdown
Think of the above options in terms of levels; Breakdown is the first level and covers the equipment itself, Restoration is the next level and replaces the data stored within the equipment, and the final option covers the cost of replacing the equipment in the short term.
Be careful to read the exclusions and inclusions in your policy for any important things you should know about. For example, you should be aware that the Breakdown option doesn’t cover you for the replacement of expendable items like batteries, ribbons, or filters, nor does it cover maintenance work or damage following ‘gradual degradation’.
And one more thing to keep in mind: any fixed equipment with a motor will need to be covered under the Machinery Breakdown section of your policy, not Electrical Equipment. When in doubt, speak to your insurer.
Portable Equipment
This insurance provides repair or replacement for accidental loss or damage to business equipment not normally kept at a specific location, such as portable computers or tools. Portable equipment is primarily designed to cover the items you take with you on the job, especially tools and handheld electronic devices.
The three biggest things that separate Portable Equipment from Electrical Equipment cover are;
- Portable equipment includes items other than electrical. That is, tools can be covered as well.
- Portable equipment isn’t fixed or kept at a specific location. Desktop PCs and workshop machinery that stays in the garage or office can’t be covered here, only portable items can; things like cordless drills, laptop computers, knives, hand-held tattoo kits, iPads, cameras, etc.
Also note that some policies cover equipment that is fixed to a vehicle, while some don’t. This is especially important for contractors, tradesman or retailers, who often have heavy equipment fixed to the back of their vehicle. Insuring under a commercial vehicle policy may also be an option.
- Theft is included in Portable Equipment cover if it arises from forcible and violent entry to locked vehicles, including locked tool boxes securely attached to the vehicle or locked buildings. Theft of equipment securely attached to a vehicle by the use of locks or padlocks is also included.
Electrical Equipment protection, on the other hand, is more so designed to cover equipment breakdown and does not include theft.
Something else to understand with Portable Equipment is that insurers often differentiate between secure storage, and ‘open air’ or covered storage. That is, some insurers exclude coverage for theft of equipment if it is stolen whilst in a car, left in a yard, stored under an awning or anywhere that isn’t secured indoors. As always, check your PDS for clarification on exclusions.
The Verdict
Portable Equipment and Electronic Equipment coverage have some similarities, but when you drill down into the details they are both as unique as they are valuable.
Get a handle on the type of equipment you have, the risks you face in relation to that equipment and the cost of repair and replacement if something goes wrong. Small things often come with expensive price tags, but with the right insurance, you won’t need to pay the price twice.
