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Equipment Breakdown Insurance

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To see a demonstration by Mythbusters of Equipment Breakdown, please click here.

Risk Control

Equipment Breakdown

What is Equipment Breakdown?
Equipment Breakdown coverage delivers insurance for the breakdown of covered equipment that runs your physical plant or office building, which is often excluded from standard commercial property insurance.

All customers have some form of EB Exposure.

Equipment Breakdown Coverage covers the following type of equipment:

  • Boilers and Pressure Vessels
  • Production Machines
  • Miscellaneous Electrical Apparatus
  • Etc.

Examples of Covered Objects:

  • Switchgear
  • Air Conditioning, Refrigeration
  • Emergency Generators
  • Boilers, Air Compressors

Hot Water and Steam Systems

Side and front view of a boiler system.

  • Boilers play an integral role at manufacturing, healthcare, and assisted living facilities.
  • Boilers heat water for hot water or steam applications.
    • Hot water/steam can be used for heating and/or production purposes.
      • Sterilization
        • Autoclaves (40-80 PSI)
    • Hot water/steam is also used to heat water for domestic use.
    • Typical boiler fuels include:
      • Oil
      • Natural gas
      • Electricity

What is a boiler?

  • A closed vessel in which water is heated, steam is generated, steam is superheated, or any combination thereof, under pressure or vacuum by the direct application of heat, for use external to itself.

Low Pressure Boiler

  • Steam Boiler
    • Maximum allowable working pressure (MAWP) of 15 psi.
  • Hot Water Heating Boiler
    • Liquid boilers with a MAWP of 160 psi and/or maximum temperature of 250 degrees Fahrenheit. Hot water is circulated for heating purposes, then returned to the boiler.
  • Hot Water Supply Boiler
    • Boiler furnishes hot water to be used externally to itself at a pressure less than or equal to 160 psi or temperature less than or equal to 250 degrees Fahrenheit.

Cast Iron Boiler

Front and side view of a cast iron boiler.

  • A boiler that has hot gases of combustion flowing around cast iron sections that contain water.
  • Can be either steam or hot water.

Hot Water Supply Boiler

Front view of Hot Water Supply Boiler.

  • Produces hot water for use other than building heat.
  • H Code stamping
  • Domestic hot water
  • Heat Exchangers

Storage Hot Water Heater

Front view of Storage Hot Water Heater.

  • HLW Code Stamping
  • Max 210 degrees F
  • MAWP 160 psi

Potable Water Heaters (HLW)
General Requirements ASME Section IV

  • Temperature controls (Operating and High Limit)
  • Pressure temperature relief valve
  • Water supply
  • Expansion Tank
  • Bottom drain
  • Thermometer

Potable Water Heaters (HLW)

Valves for a Potable Water Heater. Tag for a Potable Water Heater.

Formal maintenance program:

  1. Periodic blow-downs of the water heater bottom drain.
  2. Test high temperature limit control and all operating controls on a periodic basis.
  3. When starting a water heater, make sure ignition operates properly.
  4. Keep boiler room clean - never use the boiler room for storage!
  5. Examine all valves and cocks for ease of movement and leaks.
  6. Examine safety valves for leakage and hand lift periodically.
  7. Clean fire surfaces of the boiler (semiannually).
  8. Brush out the tubes with a flue brush (firetube boilers).
  9. On an annual basis:
    1. Clean fire side.
    2. Check all refractory.
    3. Check piping insulation.
    4. Check electrical controls and terminals.
    5. Have the water heater examined by a National Board Commissioned Inspector employed by a jurisdiction or an authorized inspection agency.

Internal pictures of rusted equipment. A broken piece of equipment.

Electrical/Life Safety/Power Gen.

Front and side view of an emergency power generator.

  • Emergency power generation is usually restricted to lighting circuits, elevator, dedicated circuits, life critical systems.
  • Some electrical systems may incorporate a larger generator or several generators to feed emergency circuits at the main power distribution panels.
  • Provided at three phase, sixty cycle with voltages to power assigned equipment.
  • Generators are driven by diesel, natural gas, or propane fueled engines. Gasoline is rarely used.
  • In some instances, steam and/or gas turbines may also supply facility power.

Several large electrical boxes on a cement platform. 

Switchgear

Switchgears in a room.

Maintenance programs should include the following:

  1. Inspections for adverse environmental conditions, exposures, system changes, and the effect of heat, contamination, moisture, and deterioration on annual basis.
  2. Inspection, cleaning, resistance testing of breaker contacts, lubrication, exercising of molded type circuit breakers. Larger duty circuit breakers (225 amps or above) should be electrically trip tested to ensure proper operation of the trip elements and trip linkages.
  3. Routine Infrared Inspections.

Arc Blast to Switchgear

Results of an Arc blast to a Switchgear.

Electrical Distribution Failure

Results of Electrical Distribution Failure.

Large Power Transformer Failure

Results of Large Power Transformer Failure.

Electrical switch yard with a high voltage transformer (appears to have had an explosion internal arcing). The fire is from the oil which is typically internal to the unit.

Larger transformer could take several weeks or months to obtain. A written contingency plan or redundancy (emergency generator) will minimize the down time.

A/C and Climate Controlled Systems

Front and side view of an A/C and Climate Control System.

Air Conditioning plays an integral role at a majority of Real Estate, Health Care, Technology, Financial Institutions and other CNA Segments. Air Conditioning keeps people and equipment comfortable.

  • Air conditioning works by the removal of heat from a selected medium such as air or water.
  • Air conditioning is used to control the temperature and humidity of a selected space.
  • A selected space can be an operating room, waiting room, computer room, office space, or other spaces which require climate control.

Equipment Breakdown Risk Control Services

  • Jurisdictional Inspections
  • Customer Focused Risk Assessments
  • Infrared Scans
  • PrepWise

Hot Water and Steam Systems

What is considered a jurisdictional object?

  • North Carolina is a boiler and pressure vessel state.
  • All steam boilers and boilers rated at more than 120 gallons or 200,000 btu/hr input.
  • Hot water storage tanks that do not exceed 120 gallons.
  • Air tanks that do not exceed 5 cubic feet and 250 psi.
  • Low pressure boilers and pressure vessels shall undergo an external inspection biennially. They receive a 24-month certificate.
  • Hydropneumatic storage tanks shall undergo an external inspection every four years.

Selling Solutions

Equipment Breakdown Risk Control Works two ways

  1. Protects the Assets of our Insured.
  2. Protects the Business Continuity Plan for our Insured.

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