Assisted Living Facility Insurance for Equipment Breakdown

Nursing homes and assisted living facilities have implemented technology and equipment to improve the quality of care and comfort to their residents as well as their staff. However, because they depend on many types of electrical, mechanical and computer-controlled equipment to support facility operations, this is exemplary of the need for assisted living facility insurance for when equipment breaks down or malfunctions.


To gain a better perspective of the equipment subject to equipment breakdown, think of an interruption to a facility during a power outage. Electricity is so critical that many owners make sure that their facilities are equipped with emergency generators to support critical functions during electrical service interruptions. Having installed electric-generating capacity creates even more opportunities for equipment breakdown.


Business interruption can be costly and even lead to injuries


These hazards can be magnified when a facility contains elderly people in all different states of poor, and perhaps even failing health. In an instance where there is electrical arcing of generator windings or mechanical damage to diesel engine push rods and exhaust valves, the facility may require evacuating people until the situation is restored to normal.


For example, let us say that a 50-ton air conditioning unit suffers mechanical breakdown during the night at an assisted living facility. Temperatures inside the facility could climb above 90 degrees Fahrenheit, and a decision would likely be made to evacuate the residents to other care facilities. Eventually the air conditioning unit is replaced, and the insured is reimbursed for loss of income associated with temporarily relocating the residents. But the cost, without insurance could easily be around $50,000 in property damage and $100,00 in business interruption.


Electrical breakdown is generally the most frequent type of loss. An improperly cleared electrical arc can also destroy circuit breakers, motors and electrical control equipment utilized to support facility operations. This can lead to significant property damage and interruption of normal operations for days until repairs can be made or replacements can be installed.


Boilers, air conditioning, heating and ventilation equipment are all needed to provide comfort to residents. Although this equipment is considered quite reliable, it is also highly susceptible to the perils of equipment breakdown. Most jurisdictions require boilers and pressure vessels to be inspected by a qualified inspector. These services may be provided at no charge as part of equipment breakdown coverage as part of the assisted living facility insurance package.

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