nursing home insurance rates

Equipment Breakdown and Facility Coverage Rates

Nursing homes have implemented advanced technology and new equipment to improve the quality of care and comfort they provide to their residents and staff. However, relying on an assortment of electrical, mechanical and computer-controlled equipment to support operations presents its own concerns, which means your clients have a need for equipment breakdown insurance in the event of an equipment malfunction.

Electricity is such a critical part of the equation since it determines whether most equipment will function when needed. As a backup, many owners make sure that their facilities are equipped with emergency generators to support critical functions during electrical service interruptions. The need for additional policies must be factored in, as this will increase the nursing home insurance rates for your clients.

Business interruption can be quite costly

Society’s growing demand for power has extended to the health sector, which is more and more dependent upon electricity to operate safely. Business interruption, in addition to any necessary repairs that must take place, can be extremely costly, especially if conditions require moving residents to an alternate location for any amount of time. For example, if the air conditioning units fail to function during intensely hot weather, the elderly, many of whom may be in poor or even failing health, would require relocation to a properly functioning facility.

An improperly cleared electrical arc can also destroy circuit breakers, motors and electronic 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. Plus, the cost without insurance could be in the area of around $50,000 in property damage and perhaps $100,000 in business interruption.

Boilers, air conditioning, heating, and ventilation equipment are also needed to provide comfort to residents and others visiting or working at the facility. Although this equipment is generally quite reliable, power outages are not all that uncommon.

Sensitive business machinery is highly susceptible to the perils of equipment breakdown. Most jurisdictions require boilers and pressure vessels to be regularly inspected by a qualified service technician. These services may be provided at no charge as part of any equipment breakdown coverage. Brokers should take the time to secure the best nursing home insurance rates for clients faced with the possibility of costly equipment malfunctions.