Electronic equipment insurance: what it covers and who carries it
Cover for computers, point-of-sale systems and specialised electronics against damage and breakdown.
This is usually a section inside a business pack, not a policy sold on its own. Which sections a policy includes is shown on its schedule, and insurers group and name them differently. Business pack insurance
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In short
- Electronic equipment cover responds to damage and breakdown of computers, point-of-sale systems and specialised electronics.
- It commonly extends to reinstating data and to the increased cost of working while systems are down.
- It is about the hardware and its immediate consequences, not about a cyber incident.
Electronic equipment cover exists because modern trading equipment fails in ways property policies were not written for, and because replacing the box is rarely the end of the loss.
It sits closest to machinery breakdown, and is frequently confused with cyber cover, which answers an entirely different question.
Also called: electronic equipment insurance, electronic breakdown, computer cover
Hardware, data and downtime
The base cover is accidental damage and breakdown of the equipment described. Most wordings extend to the cost of reinstating data from backups, and to hiring replacement equipment so the business keeps trading.
For photographers, IT businesses and retailers running point-of-sale, the downtime extension is frequently the part that matters.
The line between this and cyber
This cover responds when equipment is damaged or fails. Cyber liability responds when systems are attacked, data is exposed or a business is extorted, whether or not any hardware is harmed.
A laptop dropped in a car park is this policy. The same laptop encrypted by an attacker is the other one.
What people get wrong about it
The first error is assuming portable equipment is covered away from the premises. Portability is usually a specified extension, not an assumption.
The second is expecting data reinstatement without backups, when most wordings pay to restore from a backup rather than to recreate what was never kept.
The third is treating the cover as cyber protection, which it is not.
Questions
- Is my laptop covered when I take it to a client site?
- Only if portable equipment away from the premises has been included. Cover that is limited to a specified address does not travel with the device.
- Does it cover a ransomware attack?
- No. That is what cyber liability is written for. This cover responds to physical damage and to equipment failure.
Occupations that commonly carry it
Ordered by how central this cover is to each occupation in the graph. A pattern in the data, not a statement that any business is required to hold it.
- Photographers — Commissioned photography on location and in studio, carrying valuable equipment.
- Videographers — Video production and filming, on client sites and in public places.
- IT consultants — Advice, implementation and managed support for business technology.
- Graphic designers — Brand, print and digital design work delivered as artwork and files.
- Marketing consultants — Campaign strategy, media buying and content services for client brands.
- Copywriters — Written content and advertising copy produced to a client brief.
- Interior designers — Interior specification, documentation and procurement for homes and workplaces.
- Software developers — Custom software and application development delivered under contract.
- Web designers — Design and build of websites and online stores, often holding client data and hosting.
- Auto electricians — Diagnosis and repair of vehicle electrical and electronic systems.
- Surveyors — Cadastral and construction setting-out surveys, and the plans that depend on them.
- Manufacturers — Making and finishing goods for sale, where the product carries liability past the gate.
Sources
- Moneysmart (ASIC) — General guidance on business insurance from the regulator’s consumer site. A starting point, not a definition of this cover.