Your business may need to lease equipment to fulfill a special or expanded contract or to serve a temporary role while you decide on a permanent purchase or await repair of items your company owns.
In these cases, many companies turn to rental centers or equipment-leasing enterprises. Phones, furniture, specialty printers, refrigerators and a variety of production machines are all commonly leased. But who insures this property? Is it covered by your commercial property policy in case of a disaster? And what about business income protection if the equipment breaks down and takes your production down with it? There are many other things to consider, including theft, vandalism and electrical problems that cause damage to the leased machinery.
In some cases, you can amend your business insurance to provide the necessary coverage for leased equipment, and some lease contracts demand that. Without
the proper changes made to your insurance policy to comply with the lease’s insurance requirement, many commercial property insurance policies will not pay the amount needed to fully reimburse the lessor.
Your insurance agent can help you sort through the coverage requirements imposed by the leasing company and discuss what other property insurance changes might be valuable. Call to schedule a review before you sign the lease contract to make sure you have proper protection when it comes to leased equipment.
