From FNOL to Resolved: Steps for Business-Critical Equipment Claims

“Business-critical equipment” means something different to every commercial policyholder, depending on their industry. For a technology company, it might encompass data centers and computer systems. In a medical facility or dental office, it could include X-ray and sterilization equipment. For others, it’s gas pumps, ATMs, car washes, printing presses, production line machinery, or broadcast equipment. 

No matter the industry, one thing remains constant: business-critical equipment included in claims demands specialized expertise to ensure quick and accurate resolutions. To help you navigate these losses, use the roadmap outlined here along with expert support. 

When production line machinery fails at a manufacturing company, work can come to a standstill for a while without a plan in place.  

Stabilize the Equipment 

Claimed equipment may need to be cleaned and stabilized via a restoration process before it can even be assessed. This step is not the same as restoring the equipment to its pre-loss condition, but it does ensure that items can be safely and accurately tested. 

Experts may employ cleaning techniques such as wet or dry cleaning, ultrasonic cleaning, moisture removal, vacuum-based contamination removal, steam cleaning, or the use of abrasive cleaners. However, because improper cleaning can cause further damage and increase losses, this critical step should always be entrusted to trained professionals. 

Verify the Cause of Loss and Scope of Damage 

Failing to verify the cause of loss and the extent of damage in business-critical equipment claims can expose your carrier to costly indemnity leakage through unnecessary repairs or replacements. It may also cause the policyholder to have to wait for replacements when a repair would be quicker and just as effective to return equipment to pre-loss condition. Partnering with an objective, expert vendor for onsite assessments is key to ensuring accurate settlements. 

These experts can determine whether the reported cause of loss genuinely caused the equipment failure or if another peril, such as wear and tear, is responsible. They may also identify equipment that remains non-damaged, as policyholders may assume all equipment has been affected when some items included in the claim may still be fully operational. Without an unbiased professional to test and verify the damage, you risk unnecessary repairs or even replacing equipment that’s functioning as designed. 

Although this dental X-ray equipment was included in a claim and reportedly damaged by water, TechLoss Consulting & Restoration’s expert onsite inspection determined it to be fully functional and free from any contamination. 

Identify the Most Appropriate Solution 

After establishing what impacted your policyholder’s equipment and to what extent, you can begin considering solutions for returning any damaged equipment to pre-loss condition if coverage is afforded. 

At this stage, it’s crucial not to default to replacing all damaged equipment, even if the policyholder’s contractor or equipment supplier recommends it. Instead, work with experienced, objective consultants who thoroughly assess whether repairs are a viable option while considering cost and availability. When replacements are necessary, ensure you have a clear understanding of Actual Cash Value, Replacement Cash Value, and that any replacements meet Like Kind and Quality standards to match the original equipment.   

TechLoss found that this gas pump had been damaged by high voltage surge, but that it could be restored to pre-loss condition via replacement of the pin pad assembly and credit card reader, rather than a full system replacement. 

Get Them Back To Pre-Loss Condition 

Once you’ve determined the best course of action for a covered loss, having an assessment partner who can act as an extension of your team can be invaluable. From sharing vendor research and quotes to coordinating repairs and arranging loaner equipment, the right experts can help you move a claim forward smoothly through resolution and beyond. 

Your All-in-One Partner for Business-Critical Equipment Claims 

Not every business-critical equipment claim requires the same level of support. That’s why partnering with an assessment provider who can scale their services to meet your specific needs is so valuable. Whether you need a desk review to verify pricing, a detailed onsite inspection, vendor recommendations for market-value repairs or replacements, ongoing support through litigation or subrogation, or something in between, having the ability to choose makes all the difference. 

TechLoss Consulting & Restoration, part of Alpine Intel’s suite of services, gives you that flexibility. Their experts are equipped to assess electrical, mechanical, and electro-mechanical equipment losses impacted by various perils, offering claim solutions that are swift and actionable even amid catastrophic incidents. No matter what “business-critical equipment” means to your insureds, you can count on TechLoss for tailored support to meet the unique demands of each claim. Submit an assignment to get started. 

Alpine Intel’s content is meant to inform and educate readers using general terms and descriptions. They do not replace expert evaluations that determine facts and details related to each unique claim.