How Does ATM Insurance Work?

Author Justin Gilmore

When you buy an ATM machine or start an ATM business, you have an excellent opportunity to generate a healthy passive income. The tradeoff, of course, is that wherever you store large quantities of cash (like an ATM), that place becomes a potential target for theft. Any ATM machine not owned by a bank is not subject to FDIC protection, so if your machine is burglarized, damaged or stolen, it’s up to you to cover your losses. This is why ATM insurance is always a good idea to cover any ATM machines you own.

Why Do You Need ATM Insurance?

If you keep your ATM machine inside your own brick-and-mortar business, you might assume it’s covered by your business insurance—but that’s not always the case, and even if it’s covered, it might not cover everything. In addition, if you maintain ATM machines off-site or in standalone locations, they probably aren’t covered at all. ATM insurance greatly reduces the risk of loss in these situations, and the cost of the premium is an easily managed business expense.

How Does It Work?

As the name suggests, ATM insurance is specifically written to cover potential loss and damage to ATM machines, as well as the cash inside them. It works pretty much the same as any other coverage you might maintain on your home or your business. You purchase enough insurance to adequately cover loss for each machine you own, and your premium is based on how much coverage you need, any add-ons you want and any specific risks you need to mitigate.

What Does ATM Insurance Cover?

Like any other form of insurance, the terms of ATM coverage can differ widely according to the company issuing it and how much you’re willing to pay. Some policies are far-reaching, covering everything from stolen cash to employee dishonesty to physical damage. Some policies may cover only the cash inside the machine and not the machine itself. For the greatest peace of mind, look for ATM insurance that provides robust coverage for any/all of the following:

  • Burglary—cash stolen from the ATM itself
  • Mysterious disappearance—for when the entire ATM is somehow removed
  • Physical damage or property loss—covers repairs or replacement of the ATM itself
  • Robbery—if you or your employee is/are robbed while servicing the machine
  • Employee dishonesty—covers you if an employee steals cash from the machine while servicing it

It’s important to note that some policies will cover these issues comprehensively, while some will offer certain types of coverage as add-ons or riders—and some things may not be covered at all. Always read the coverage “fine print” thoroughly before agreeing to buy the insurance.

Other Options

Like other forms of insurance, not all insurance will automatically cover every conceivable type of theft or damage. A couple of add-ons you might want to consider:

  • “Jackpotting”—If a hacker reprograms the machine to empty itself of cash, it might not be covered as “theft” under typical insurance because it records as a legitimate transaction. A jackpotting rider will cover this loophole.
  • Contingency coverage—If you have your ATM serviced and stocked by a security company, that company should carry its own cash-in-transit insurance that covers them if your cash is stolen while in their possession. If for some reason their insurance fails to pay, contingency coverage will kick in to absorb the loss (not unlike uninsured motorist coverage for your car).

National ATM Wholesale is naturally concerned for the safety of our customers, their property and their business. If you need recommendations for quality ATM insurance for your machines, reach out to us at 1-866-295-2329.