What it does
The Equipment Breakdown Cause of Loss endorsement (CP 10 46) lets the insurer suspend breakdown coverage immediately on any "covered equipment" found in, or exposed to, a dangerous condition, by written notice. CP 10 47 is the form used to document that action. Its Schedule identifies the premises, building, covered equipment and effective date, and shows whether it is a suspension or a reinstatement.
- Suspension: coverage for loss caused by "breakdown" of the identified equipment, including otherwise covered consequential loss such as business income, is suspended from the effective date.
- Reinstatement: coverage for that equipment is restored from the effective date once the condition is corrected.
Quoting and selling notes
- A suspension is serious. A breakdown of that equipment, and the resulting shutdown, is uninsured until reinstated. Work with the client to complete repairs and arrange re-inspection quickly.
- Check the effective dates on any suspension notice and diary for reinstatement.
- Suspension under CP 10 46 earns the insured a pro rata premium refund for the suspended coverage.
