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Mid-market insurance
HVAC manufacturer insurance is a programme covering makers of heating, ventilation, refrigeration and climate equipment for property, people and product risks. It matters because a faulty unit can damage a whole building.
Part of: Manufacturing insurance
In short
UK makers of HVAC, ventilation, refrigeration and heat pump equipment usually need property and business interruption, machinery breakdown, employers' liability, products liability and cargo or stock throughput cover. Fire and water damage caused by units in customers' buildings drive the products risk. Design, sizing and selection often bring a professional indemnity need, and installation or commissioning brings site liability. GB F gas bans and certification rules, pressure equipment rules and warranty terms all need reading alongside the policy.
A maker of air handling units, fans, ventilation and heat recovery units, chillers, heat pumps, refrigeration or climate control equipment usually needs property and business interruption, machinery breakdown, employers' liability, public and products liability, and transit or marine cargo cover. Many also need professional indemnity, because they select, size or design systems rather than just supplying boxes, and contract works or site liability cover for installation and commissioning.
The defining risk is that the products are electrical, often pressurised, and installed inside other people's buildings. A fan motor fire, a failed condensate drain or a refrigerant leak can damage a building and its contents far beyond the value of the unit. The manufacturing insurance guide covers the wider programme; this page covers what is specific to HVAC and refrigeration makers.
| Exposure for an HVAC manufacturer | Cover that usually responds |
|---|---|
| Fire at your factory from brazing, test rigs, refrigerant charging or stored insulation | Property damage and business interruption |
| Fire in a customer's building started by a unit's motor, heater battery or controls | Products liability |
| Water damage from leaking coils, condensate trays or humidifiers | Products liability for damage to other property, subject to terms |
| Units that run but miss their stated duty, noise or efficiency | Professional indemnity or a financial loss extension, if design or selection was involved |
| Damage during installation or commissioning on site | Public liability plus contract works or erection all risks |
| Breakdown of test rigs, press lines or coil manufacturing equipment | Machinery breakdown with loss of profits if bought |
| Imported compressors and controls lost or damaged in shipment | Marine cargo or stock throughput |
| Employee injury from lifting, sheet metal work, brazing or refrigerant exposure | Employers' liability |
| Recall or retrofit campaign for a faulty component | Product recall cover (see the recall toolkit) |
| Attack on connected controls, remote monitoring or the ERP system | Cyber, including system outage |
| Regulatory investigation or claims against directors | D&O and management liability |
Changes in refrigerant rules can also affect insurance. A move to lower GWP refrigerants, some of which are flammable, may change fire risk at the factory and in the field, so tell insurers when the product range changes.
Illustrative example 1: rooftop unit fire. A heater battery control fails on a rooftop air handling unit and a fire damages the roof and the floor below. Products liability usually responds to the building damage and any injury. The cost of replacing the unit itself is not normally covered.
Illustrative example 2: underperforming system. A manufacturer sizes ventilation units for a new office using the client's brief. After occupation the building overheats and the client claims the cost of extra cooling. There is no physical damage, so the claim is financial and usually sits with professional indemnity, provided design or selection was declared.
Illustrative example 3: commissioning leak. During commissioning a joint fails and refrigerant and water escape into a data room below. Public liability usually responds to the third party damage, and contract works cover to the works, subject to who carries the site risk under the contract.
Review when you launch a new product family such as heat pumps, change refrigerant, start offering installation or maintenance, sign a framework with a contractor that asks for PI or collateral warranties, open export markets or buy another business. These are the points where the policy and the business tend to drift apart. An insurance programme review checks activities, limits and contract terms together. See also manufacturers insurance and the sister page on machine tool and industrial machinery makers.
Apex arranges insurance programmes for HVAC and ventilation equipment manufacturers; a broker reads every enquiry.
Usually yes, if the leak is caused by a defect and damages other property, such as ceilings, stock or equipment, subject to the policy terms and any excess. It does not normally pay to repair or replace the unit itself, and gradual leaks may be treated differently, so check the wording.
If you design systems, size or select equipment for a project, or give performance advice, a client who suffers financial loss without physical damage may claim against you. Products liability does not usually cover that. PI, or a carefully worded financial loss extension, is the usual answer where design is a real part of the work.
Government guidance says company certification is needed to install, repair, maintain or decommission stationary refrigeration, air conditioning or heat pump equipment for others. A manufacturer that only builds and ships sealed units may not need it, but one whose engineers commission or service equipment on customer sites usually will.
Not usually. Repairing or replacing your own defective product under warranty is a business cost rather than an insured liability. Insurance may respond to the consequences, such as damage to a customer's building, and recall cover can help with recall campaigns, subject to terms.
Send us your current schedules or renewal pack and we will review the whole programme and tell you plainly what to keep and what to change. No fee and no obligation. Or call 0117 325 0027.
Book a programme review Get a quoteApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information, not advice on your individual circumstances, and it does not guarantee that cover will be available or on what terms.
