Unit 14

Front 1

Boiler and Machinery Policy:

Back 1

Coverage is risks of direct and indirect loss arising from "accidents" to "objects" (such as boilers,generators,engines,pumps,compressors, and turbines)

Front 2

Policy Consists of:

Back 2

Declarations

Common Policy Conditions

Coverage Forms

Object Definitions Form

Any Endorsements

Front 3

Three coverage forms:

Back 3

Boiler and Machinery

Small Business Boiler and Machinery

Small Business Boiler and Machinery Broad Forms

Six object Definitions forms:One or more required with Boiler and Machinery form
Small business forms contains object descriptions as part of coverage provisions

Front 4

Boiler and Machinery Form:

Back 4

Coverage

Exclusions

Limits of Insurance

Deductibles

Conditions

Definitions

Front 5

Coverage Section States:

Back 5

Insurer will pay for direct damage to covered property from a covered cause of loss

Covered Property includes-

Property owned by insured

Non-owned property in care, custody shown in declarations which is in use or connected and ready for use at specified location.

Front 6

Accident exclusions:

Back 6

Depletion, deterioration for cost of temporary repairs and to expedite permanent repairs or replacement.Leakage at any value, fitting,shaft seal, gland packing, joint or connection

Front 7

Under a policy with the Boiler and Machinery form, with no endorsements, states"covered" or "not covered" for the following incidents. Under Boiler and Machinery insurance: "The insured suffered windstorm water damage of the air conditioning unit, a covered object"?

Back 7

Not covered; exclusions delete coverage.

Front 8

Under a basic Boiler and Machinery Form, with no special endorsements, which of the following losses would be covered?

Back 8

Property owned by another in the care of the insured was damaged in an accident to an insured object, resulting in a claim by the owner of the property.

Front 9

Describe the deductible in a Boiler and Machinery Insurance Policy.

Back 9

The deductible is deducted from the amount, which would otherwise be paid for each accident,The standard deductible is $500; higher deductibles are optional,If more than one object is involved in a single accident, the highest deductible applies.

Front 10

Which of the following are specifically excluded from the "accident" definition in a Boiler and Machinery Insurance Policy?

Back 10

Leakage at any valve, fitting, joint or connection,Depletion, deterioration, corrosion, wear and tear,Breakdown of any vacuum tube, electronic computer or data processing equipment.

Front 11

What extensions of coverage are available under the Boiler and Machinery policy?

Back 11

Automatic Coverage-(90 days automatic coverage)

Defense-(defend the insured against claims or suits)

Expediting Expenses-(cost of temporary repairs etc)

Front 12

What coverages are automatically provided as an extension of Part A?

Back 12

Expediting expenses,Defense cost for claims or suits arising out of covered occurrences, Automatic coverage for 90 days.

Front 13

Under a policy with the Boiler and Machinery form, with no endorsements, states"covered" or "not covered" for the following incidents. Under Boiler and Machinery insurance: "In an accident involving a covered object, a visitor on the insured's premises suffered injuries and sued the insured"?

Back 13

Not covered; bodily injury liability is an optional coverage,which must be added by endorsement, if desired.

Front 14

What exclusions are in a Boiler and Machinery Coverage Form?

Back 14

Flood,Lightning, Any increase in loss from enforcement of law regulating repair, alteration, use, operation, construction or installation.

Front 15

Under a policy with the Boiler and Machinery form, with no endorsements, states"covered" or "not covered" for the following incidents. Under Boiler and Machinery insurance: "The insured suffered water damage to carpeting and floor when an accident occurred to the air conditioning unit, a covered object"?

Back 15

Covered (subject to a limit of $25,000) covered property.

Front 16

What is the suspension condition of the Boiler and Machinery form?

Back 16

Whenever an object is found to be in or exposes to a dangerous condition, an insurer may immediately suspend the insurance against loss from an accident to that object.

Front 17

Extensions of coverage:

Back 17

Expediting Expenses

Automatic Coverage

Defense

Supplementary Payments.

Front 18

Expediting Expenses:

Back 18

Reimbursement for cost of temporary repairs and to expedite permanent repairs or replacement.

Front 19

Automatic Coverage:

Back 19

90 days automatic coverage at newly acquired locations.

Subject to highest limit and deductible as stated in declarations for same type of object

Front 20

Defense:

Back 20

Insurer will defend insured against claims and suits arising out of covered occurrences

No dollar amount limit

Front 21

Supplementary Payments:

Back 21

Liability Claims

Insurer pays all litigation cost

Same type of supplementary payments under other liability policies

Front 22

Boiler and Machinery Policy Exclusions:

Back 22

Increase loss due to law enforcement, war, nuclear hazards, fire explosion,Windstorm,hail,freezing,lightning,aircraft,vehicles,sinkhole collapse,smoke,sprinkler leakage or weight of ice, snow or sleet,Flood,Accidents while being tested,lack of power,light,heat,steam or refrigeration, indirect loss.

Front 23

Boiler and Machinery Policy Limits:

Back 23

Minimum Basic: $500,000(direct loss from one accident.

Claims defenses and supplementary Payments(no subject limit).

Front 24

Boiler and Machinery Policy Limits: Continued

Back 24

Limitations: $25,000-Maximum amount available for expediting expenses.$25,000-Limit for additional expenses of cleanup,repair,replacement, or disposal or property for damaged caused by substance declared hazardous by government.$25,000-Limit for damage caused by ammonia contamination.$25,000-Limit for damage by water

Front 25

Boiler and Machinery Deductibles:

Back 25

Subtracted from any amounts to be paid for each accident.

If more than one object is involved in a single accident, the highest deductible applies.

$500 is the Standard.

Front 26

Boiler and Machinery Conditions:

Back 26

Valuation Clauses and Suspension Conditions

Front 27

Valuation Clauses:

Back 27

Provides replacement cost for all covered property.

If replacement is not made in 18 months of accident ACV applies.

Front 28

Suspension Conditions:

Back 28

Contains provisions giving any company representative the right to immediately suspend insurance against any loss or accident to that object when object is found to be in or exposed to dangerous condition. Written notice of suspension is mailed to insured's last know address.

Front 29

Objects Definitions Forms:

Back 29

Some types of Coverage forms: Boilers (Steam,hot water,Fired tube, water tube,cast-iron types) Refrigerating Equipment, Air-conditioning,Generators,Pumps,Engines,Machinery,Compressors,Transformers,Turbines

Front 30

Boiler and Machinery Indirect loss coverage Endorsements:

Back 30

Loss form interruption to insured's operations caused by an accident to an insured object is available on either a "Valued" or "Actual loss sustained" form: Valued Business Interruption endorsement, Actual Loss Sustained business Interruption Endorsement, Extra Expense Form.

Front 31

Valued Business Interruption Endorsement:

Back 31

Pays agreed dollar limit for each day of total interruption or proportionate part of limit for partial interruption. States daily limit and total dollar limit based upon 90times,100times,126times,153times,180times,216times,270times, or 360 times daily limit. Deductible may be expressed in days (such as two-day deductible or stated dollar amount

Front 32

Actual Loss Sustained business Interruption Endorsement:

Back 32

Covers actual lost profits and necessary continuing expenses incurred through interruption period. 100% coinsurance required, amount of insurance in related to annual net profits plus fixed expenses as contained in required annual reports. Same as for valued-may be expressed in days or stated dollar amounts.

Front 33

Extra Expense Form:

Back 33

Coverage for extraordinary expenses to maintain ongoing operations over and above normal expenses. A schedule of limits apply to the total amount of coverage depending upon the period of restoration. Deductible is expressed in dollar amounts.

Front 34

Boiler and Machinery Miscellaneous Options:

Back 34

Limited coverage endorsement, Actual Cash Value Endorsement, Additional Expediting Expenses, Water Damage and Ammonia Contamination Endorsement, Bodily Injury Liability Endorsement, Consequential Damage Endorsement.

Front 35

Limited Coverage Endorsement:

Back 35

When the object is a boiler, fired or electric steam generator this endorsement redefines "accident" to cover only "sudden and accidental tearing asunder" of the object as opposed to "sudden and accidental breakdown" in coverage form.

Front 36

Actual Cash Value Endorsement:

Back 36

Available to change loss settlement from "replacement cost" to ACV

Front 37

Additional Expediting Expenses, Water Damage and Ammonia Contamination Endorsement:

Back 37

Permits increasing the $25,000 limit for each to any desired higher amounts.

These increase do not increase the per accident limit, only increasing the amounts available within such limit for those exposures.

Front 38

Bodily Injury Liability Endorsement:

Back 38

Provides excess coverage for this exposure over any other liability insurance. (This exposure is generally excluded and covered by insured's general liability policy)

Front 39

Consequential Damage Endorsement:

Back 39

Covers loss due to spoilage from lack of power, light, steam, heat, or refrigeration caused by accident to covered object.

Type of property covered must be stated in endorsement. Form of indirect loss.

Front 40

Boiler and Machinery Small Business Forms:

Back 40

Small Business B and M Form & Small Business B and M Broad Form: Two small business forms are subject to limitations as types of business and insurable objects. Property damage limit is 80% of building replacement value. (80% replacement value not over $500,000,000)

Front 41

Small Business Boiler and Machinery Form:

Back 41

Boilers and Pressure vessels for property damage and business interruption, air conditioning and air compressing units for property damage and business interruption.

Covered property and covered cause loss same in boiler and Machinery policy.

Standard Deductible of $500 per accident.

Front 42

Small Business Boiler and Machinery Form: Continued.

Back 42

Business Interruption includes extra expense and covers on an "Actual Loss Sustained" Basis for 25% of limit that applies to property damage losses as a additional amount of insurance.

Exclusions, internal limits, conditions same as in Boiler and Machinery policy; except no coinsurance clause; no coverage for increase loss expenses due to hazardous sbustances

Front 43

Small Business Boiler and Machinery Broad Form:

Back 43

Property damage and business interruption/extra expense applies blanket to all objects. Spoilage coverage optionally may be included, subject to a limit of $5,000, $10,000, or $25,000 and separate deductible of $500.Internal limits for hazardous substance (other than ammonia) and ammonia contamination each $25,000 per accident.