Statistics Review: Business Interruption Time after Equipment Restoration versus Replacement

Time is Money, and it’s Costly

When a business is affected by a major loss incident the primary goal is to get the business up and running, and back to pre-loss condition.  Time is money, and for that reason it is important to consider business interruption time, which can create an even larger loss than just the initial loss incident.  Restoration of equipment saves a significant amount of time, and therefore a significant amount of money for all parties involved, including the insurer, the insured, and the insured’s clients.  Replacement costs are a combination of the price to compose specifications, purchase, deliver, install, test, and train staff on the new equipment.  Each stage in the process creates additional business interruption time, adding delays and hard costs.

Restoration results in reducing these delays and hard costs.  When items are deemed restorable the task is to then deliver on how quickly the restoration work can be completed properly while gaining and maintaining the confidence of all parties involved, including the manufacturers.  The restoration process has proven time and again that business interruption time – and hence cost – is drastically reduced in comparison to outright replacement.

The following graph displays the clear time difference between restoring equipment as opposed to replacing it.  Based on seven real-life case studies from Newtron Group files, these examples demonstrate and substantiate the advantage of equipment restoration over replacement, illustrating how drastically business interruption time had been reduced.

The Importance of Business Continuity & Reducing Business Interruption

All Property Insurance professionals understand the importance of business continuity, and recognize that reducing business interruption by getting businesses back up and running as quickly as possible after a commercial loss is in the best interest of all parties involved.  There are many factors that can affect the amount of time it takes to get a business back up and running, however replacing equipment that can be restored should not be one of them.  As demonstrated in the actual case studies presented, time and costs can be cut in half or even less by choosing equipment restoration.

Time is of the essence when equipment is exposed to fire, smoke, contaminants or moisture.  As the clock ticks, deterioration and corrosion do not stop.  If items are left untreated after the exposure, this allows for deterioration and corrosion to turn restorable items into write offs.  Time wasted equals lost opportunities, and it is critical to get exposed equipment assessed and treated immediately after an incident is reported.

Who are you going to call before time runs out?

It is clear that equipment restoration should be considered immediately after a property loss.  It is important to have an experienced and qualified vendor for such service at your disposal 24/7/365 anywhere in the country.

Newtron Group is the most qualified and experienced large industrial and commercial equipment restorer in Canada.  They can be called into action at any time to assess the damage and provide trouble-free recovery services.  They can assist with getting businesses back up and running after a major loss incident, by providing efficient and quality restoration services for all electrical, electronic, mechanical, medical, and manufacturing systems, and help to avoid the costly replacement of such equipment.

Make sure you and your team are familiar with equipment restoration to ensure business interruption is controlled by downloading and reviewing a free copy of The Equipment Restoration Handbook. Download Now

Contact Newtron Group and request a lunch & learn or webinar to begin a relationship that will help your team to reduce business interruption time on your future claims.  Please call 1-800-238-3734 or visit www.newtrongroup.com