Boiler and machinery insurance protects companies from costly physical and financial damages caused by the breakdown or malfunction of boilers and other manufacturing equipment.

A term that dates back to the 19th century, boiler and machinery insurance was created in a time when factories were dependent on coal-fired boilers to generate steam and power machinery.1 Today, businesses may need it if they use boiler and machinery services, air conditioning, refrigerators, and electronic equipment.

The insurance, now also called equipment breakdown insurance, is much more inclusive and covers a wide range of mechanical and electrical machines, such as industrial turbines, furnaces, photocopiers, and heating and cooling systems.

What does boiler and machinery insurance cover?

Boiler and equipment insurance covers breakdowns of vital production equipment. This includes everything running from boilers, to A/C’s and pressure equipment. Because so many businesses rely on this equipment, even a small slowdown can have a major impact on production.

However, many people make the mistake of turning to commercial property insurance, only to find out that it doesn’t cover malfunctions and damage to their machinery. That’s where boiler and machinery insurance comes in handy.

For the insurance to cover you, the damage has to be extensive enough to require repairs or replacement. This is often the rule insurers enforce to prevent businesses from taking advantage of the policy.

Types of damage covered by boiler and machinery insurance

Most equipment breakdown policies broadly define the covered equipment, so almost all equipment that is owned, leased or operated by a company is covered. They can also cover:

  • Mechanical breakdown — This includes motors, generators, elevators, water pumps, and specialized production and manufacturing equipment.
  • Technology — Electronics including computers (ruling out software that requires cyber liability insurance), communications systems, security systems, and fire alarm systems.
  • Electrical issues — This term refers to transformers, electrical panels, and cables that can cause damage due to surges and/or electrical arcing.
  • Air control — Air conditioning and refrigeration, including refrigerants.
  • Business losses from equipment malfunction — Examples include loss of business income due to a power outage or a power surge that damages a computer.

Boiler and machinery insurance vs. equipment breakdown insurance

The term “boiler and machinery insurance” is interchangeable with “equipment breakdown insurance.” It is an older term, created for a different time and people—one when steam boilers were humanity’s primary power source.

Boiler and machinery insurance generally covers these categories of equipment:1

  • Pressure vessels
  • Refrigeration systems
  • Pumps and compressors
  • Heating and air conditioning systems
  • Turbines
  • Electronic data processing systems
  • Engines that use electrical or mechanical energy or are under steam pressure

Equipment breakdown protection is an updated coverage that extends beyond boiler-powered machines to office equipment, elevators and security systems. Because these technologies weren’t around when boiler and machinery insurance was created, a separate policy for equipment breakdown protection is needed.

In fact, equipment breakdown insurance provides businesses with several protections from equipment damage and failure, such as loss of perishable food products in a restaurant’s refrigerator, medical bills if a third party is injured by an equipment breakdown, and cost of temporary repairs.

Boiler and machinery insurance vs. commercial property insurance

Commercial property insurance protects you and your firm from damages caused by an external event, such as a fire. However, commercial property insurance excludes coverage for malfunctions and damage to equipment, short circuits, electrical arcing or power surges. Boiler and machinery insurance addresses that gap in protection.2

As a result, it insures you for the cost of repairing and replacing machinery and equipment due to sudden and accidental breakdowns, as well as contingent losses caused by physical damage.

Another way to describe boiler and machinery insurance is protection from damages triggered by internal forces such as power surges, electrical shorts, mechanical breakdowns, motor burnout or operator error.

Thimble: Protecting your business

When it comes to protecting your small business, you need to think beyond equipment breakdowns. There are daily liabilities a business needs to be wary of. So where can you go for that type of protection?

Meet Thimble–the faster, smarter, more affordable way small businesses can purchase general liability insurance. We provide easy-to-buy policies by the hour, day, or month. It’s insurance for companies on the go, and who never know when their next job might be.

Download the Thimble mobile app and click “Get quote,” answer three quick questions, and voila! You’re covered. In less than 60 seconds, you can go from being exposed to liability to being protected on the job.

The bottom line is that your equipment may break down and fail you. But you can get to work with confidence knowing that Thimble won’t, with coverage for the common risks that come with any business.


  1. FM Global, Sept. 17, 2019. “Boiler and Machinery Benefits all Businesses.”
  2. US Legal. “ Boiler and Machinery Insurance Law and Legal Definition”