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Warning: What the electrical and electronic
equipment companies are not telling you about the
new hazards you face!
By Leland J. Hendrie CLU
President, PHD Insurance Brokers, Inc. |
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How often have you seen a LED display
flashing 12:00 on you clock, microwave oven or other
electronic equipment? If you’re like most of us, this
happens so often that we begin to take it for granted. But
what does this mean to us? Is it just the time and trouble
to reset all of them? No! It is a lot more, and the
manufacturers are not warning you about the dangers you
face. The new technology such as interconnecting equipment
and other gadgets can cause electrical breakdowns and damage
equipment in interrelated systems that can cost you big
money.
What’s the problem? A momentary power loss
will instantly shut down any equipment without a backup
energy source. Power is lost by all components in a system
at the same time, instead of a pre-programmed shutdown
sequence. That’s a problem because equipment may require
that a certain sequence be followed during shutdown and
start-up.
Is this a problem for you or just for business? It is a
problem for both. Everyone, including business, runs their
equipment on electricity. The uncontrolled shutdown may
cause equipment damage. Even if it doesn’t, the system may
not be in the proper condition to re-start. When the power
is suddenly restored, equipment may start up simultaneously,
instead of following a necessary sequence, and further
damage may result and cause a breakdown.
The point is, unexpected power
interruptions can damage equipment, both when the power goes
off and when it comes back on again.
Electrical losses are rising. Breakdowns
that result from a lack of power are becoming very common.
Insurance company claim data shows that electrical losses
now surpass mechanical breakdowns. Refrigeration and air
conditioning losses have leveled out since the late 1980’s,
while electrical and electronic equipment losses have sky
rocketed since the early 1980’s. So, the next time you reset
that digital clock, think about what’s at stake here. Those
flashing lights are a warning – new technology brings new
risks that can cost you dearly.
Pool and Spa Equipment Breakdowns. You no
longer have to live in California, Arizona, Florida or other
states where homeowners use their pools or spas the year
around. People in the colder regions have put spas in their
homes or have their pools built within their home or in a
separate structure. |
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| What equipment does it take to
operate a pool or spa?
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Centrifugal pumps and motors
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Filters and filtration systems
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Water heaters
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Two-speed pumps for spas
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Heat pumps (compressors, fans,
heat exchangers)
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Spa air blowers
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Generators
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Automatic pool covers
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Doesn’t my homeowners or
business policy provide coverage for this? Most
homeowner and business policies provide a range of
protection; however, equipment breakdowns are usually not
covered. To fill this gap you need to consider enhancing
your homeowners or get an additional coverage if you own a
business policy.
What else can cause my risk of loss? The
change of seasons increases the chances for equipment
breakdowns. Air conditioning breakdowns are often traced
back to a lack of attention when the equipment was shut down
at the end of the cooling season. Likewise, heating
equipment is damaged because it is pressed into service
without proper maintenance. Most companies that provide
breakdown type coverage offer loss prevention tips that will
help you avoid losses. Ask you agent about this. Does he
even know?
Sometimes equipment breakdowns have
the most unlikely causes. Although there are many causes of
equipment breakdowns, accidents involving animals always get
people’s attention. You might be surprised how many
breakdowns are caused by animals and how much the damage can
cost.Electrical equipment is
exposed outdoors, or in cellars and conduits. Boilers in
basements and rooftop air conditioning units attract birds,
rodents, squirrels and other animals. Here are just a few
examples of those types of losses. |
- Snake shuts down city. A snake
squeezed into a breaker box in a municipal utility
substation, knocking out power to a city.
- A bat flew out of a voice
processor in an attorney’s office when it was released
by the troubleshooter who was trying to find out the
cause of the shutdown.
- A horse being treated for a leg
injury kicked the head of a shockwave therapy machine.
The veterinarian said sparks later shot from the
machine, which is used to help animals heal broken bones
and caused the coil, transducer and therapy head to be
damaged.
- Birds flew into high voltage
lines connected to a transformer for a community
building complex, disrupting the power supply and
damaging 14 roof top air conditioning units. Extensive
repairs were required to repair the air conditioners.
- Two dead lizards were found in a
main electrical panel and circuit breaker at a regional
wastewater treatment plant burning out the connections.
- A squirrel shorted out a utility
transformer and caused power to fluctuate inside a
nearby service station and mini-mart. The accident
damaged a snow cone ice shaving machine and a beer
cooler’s refrigeration compressor.
Electrical equipment is a leading cause of structure
fires
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Electrical equipment is a leading cause of structure
fires. When an electrical system breaks down, it’s
not only expensive to make repairs, but can be a disaster in
terms of fire loss as well.
Electrical equipment is a leading cause of
structure fires. When an electrical system breaks
down, it’s not only expensive to make repairs, but can be a
disaster in terms of fire loss as well.
The National Fire Protection Agency
reports that electrical malfunctions are a leading cause of
fires in homes and commercial buildings. From 1999-2002,
fires caused by electrical distribution or lighting
equipment killed 240 people and resulted in more than $1
Billion in damage, according to the NFPA.
What do you need to do now? Call your
agent and find out what you need to do to cover these types
of losses. For only a few dollars, coverage can be provided
to you regardless of whether you’re a homeowner or business
owner.
At PHD Insurance Brokers we are here to help you
understand and deal with this problem. Call us at (800)
640-4743 or (714) 534-6310 or visit us on our website
www.phdinsurancebrokers.com |
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