This form of insurance provides important mechanical breakdown coverage generally not available under any other insurance policy. A boiler and machinery policy can protect an insured against the effects of catastrophic property loss, such as steam boiler explosion or an expensive breakdown of machinery and equipment.
It’s not just the physical damage caused by the explosion or breakdown that’s of concern. While repairs are being made, valuable time and profits are lost. Business interruption coverage protects against this. Often, extra expense coverage is required to keep the business in operation regardless of cost. Consequential Damage and Refrigeration Interruption insurance protects against spoilage as the result of a breakdown. Many times these business interruptions, extra expense and spoilage losses can be much more extensive than the damage to the equipment itself.
Equally important is the valuable inspection service that boiler and machinery insurance provides. Not only does this service satisfy most jurisdictional inspection requirements, but it also benefits the insured by providing sound loss control recommendations that can help assure efficient operation and longer equipment life.
It is our opinion that virtually every commercial business has some type of Boiler and Machinery insurance exposure. Keep in mind that mechanical breakdown coverage encompasses much more than just boilers and pressure vessels. It also can include refrigeration equipment, air conditioning equipment, various types of piping, turbines, engines, pumps, compressors, blowers, gearing, shafting, electric motors, generators, transformers and assorted other types of mechanical and electrical equipment. In fact, many policies are written for insureds who do not own or operate boilers or pressure vessels, but yet have sizable mechanical and electrical exposures.