Due to their rising popularity, owning a modern nightclub can be highly profitable. Unfortunately, ownership also comes with major responsibilities, and the decisions you make can greatly impact your finances and the long-term success of your business. Read on to learn why your nightclub needs equipment breakdown insurance.
To reduce certain risks and prevent financial ruin, most nightclub owners purchase a comprehensive nightclub insurance package that includes several important policies designed to protect their interests. Equipment breakdown insurance is one such policy that all nightclub owners should possess. An equipment breakdown insurance policy covers the cost to repair or replace broken or damaged equipment, including electrical, mechanical, and computer equipment.
What Equipment Breakdown Insurance Covers
Equipment breakdown policies cover damages caused by certain internal forces, such as electrical shorts, power surges, motor burnout, mechanical breakdown, or operator errors. Not all types of equipment breakdowns are covered by insurance. For example, while your policy may cover computers, it will not typically cover software. If you experience a mechanical failure or power surge that causes the equipment in your nightclub to fail, you may be forced to close your club until repairs can be made. Here are just a few things that are typically covered by equipment breakdown insurance.
Your audio system is the bread and butter of your nightclub. Without it, you would lose your customers and, in turn, your livelihood. When your audio system fails, you will need to have it repaired or replaced immediately to prevent a disruption in operations. Equipment breakdown insurance can help.
While nightclubs are known to be dimly lit, you do not want to leave your customers in the dark. Having the right lighting in your club to set the mood is important to maintain a certain ambiance. When your lighting equipment breaks down, you will want to remedy the situation as soon as possible.
The heating, ventilation, and cooling system in your nightclub is what makes your venue comfortable and inviting. If your club is too hot or too cold, your customers will likely leave to look for a more comfortable place to party. Equipment breakdown insurance can help cover these types of expenses.
When customers walk up to your bar, oftentimes all they want is a nice cold beer. When your refrigeration unit fails, it becomes nearly impossible to keep drinks cold. In addition, you risk any food you have in your nightclub spoiling, which could put your customers at risk for food poisoning and other illnesses.
If you serve any type of food at your nightclub, you probably have commercial appliances, such as stoves and ovens. If these appliances break down, it would cost thousands to have them replaced. Equipment breakdown insurance helps cover the cost of repair or replacement for kitchen appliances.
Does Commercial Property Insurance Cover Equipment?
Many business owners are under the assumption that having a commercial property insurance policy will protect them from any type of equipment-related event that should occur. This is simply not true. Commercial property insurance only covers damage that is caused by external forces, such as a fire. In contrast, equipment breakdown insurance covers damage by internal forces, such as mechanical breakdowns, power surges, or user errors.
The Importance Of Equipment Breakdown Insurance
As a nightclub owner, you may be wondering if you really need equipment insurance or if you can get by without it. When making your decision, it is important to consider the impact that an equipment failure or breakdown could have on your business. If a piece of equipment should fail, causing your operations to come to a halt, would you have the funds and resources needed to remedy the issue without draining your bank account?
There are a number of reasons why all nightclub owners should have an equipment breakdown insurance policy included in their comprehensive nightclub insurance package. A policy covers exposures that are often excluded from most property insurance policies. In addition, insurance company inspections may help decrease the likelihood of accidents that involve insured equipment. Most importantly, having the right insurance for your business can provide peace of mind, which reduces your stress and allows you more time to focus on growing your business.
Creating A Comprehensive Nightclub Insurance Package
Equipment breakdown insurance is quickly becoming a must-have for businesses in all industries. It is even more important for businesses that deal directly with the public as paying customers expect to receive quality service when they visit your venue. While you cannot always anticipate the breakdown of your commercial equipment, you can prepare for the unexpected by having the proper insurance. In this way, you can reduce certain financial risks. For more information about why nightclubs need to get equipment breakdown insurance as part of their comprehensive nightclub insurance package, call the insurance experts today at MFE Insurance.