Chapter 6

any machine subject to accidental breakdown that could destroy a large part of the machine is eligible for coverage

• 1. Boiler and machinery declarations page
• 2. equipment breakdown protection coverage form
• 3 any applicable endorsements

covered cause of loss - a "breakdown" to "Covered Equuipment"

• pays for direct damage to covered property, determine
• the value in the event of loss, or the cost acually and necessarily
• expended in repairing whichever is less costly

pays for the extra costs the insured necessarily incurs to make temporary repairs

pays the actual loss of business income during the period of restoration and extra expense insured necessarily incurs to operate their business during the period of restoration

• coverage for business income is not provided
• insurer considers the experience of business before the breakdown
• probable experience the business would have had without the breakdown determine the amt of payment

• pay for spoilage damage to raw materials, in process or finished ones due to lack or excess of power light, heat, steam or refrigeration and certain conditions are met
• also pay for necessary expenses insured incurs to reduce the amt of loss

• if business income coverage and spoilage coverage are purchased, this coverage extends by including loss result from interruption of utility services
• interruption have to last at least consecutive period of time shown in Declarations and certain conditions are met

automatically provide coverge at newly acquired premises; begins at the time insured acquires the property and continues for a period not exceeding the number of days indicated in Declarations for new premises

coverage for certian increase in loss that are necessitated by the enforcement of any laws that are in force at the time of breakdown, which regulate the demolition as a result of a breakdown

pay for loss which is not payable under this coverage part; solely because of any error or unintentional omission in location of property as insured under this coverage part

if branded or labeled merchandise is damaged by breakdown, insurer may take all or part of property at an agreed or appraised value

same terms and conditions as Business Income and Expense; to cover insured's loss resulting from breakdown to covered equip at a premises shown in Declaration

• 1. Ordinance or law
• 2. Earth Movement
• 3. Water
• 4. Nuclear Hazard
• 5. War or Military Action
• 6. an explosion
• 7. fire or combustion explosion
• 8. depletion or erosion
• 9. breakdown caused by aircraft, vehicles, freezing by cold weather, ligtning, collapse, smoke, riot, civil commotion, vandalism, weight of snow, ice or sleet, windstorm or hail
• 10. neglegent by insured

• the most the insurer will pay for any and all coverages for loss or damage from any one breakdown
• unless a higer limit or included is shown in declarations, the payment is $25,000
• the amt paid - not in addition to limit of insurance for property damage

spoilage to covered property contaminated by ammonia

reduction in the value of undamaged stock of product which becomes unmarketable

insured's cost to research, replace, or restore damaged data or media

additional expenses incurred by the insured for the clean up of covered property that is damaged by a hazardous substance

• damage to covered property by water
• no coverage if resulting from leakage of sprinkler system or domestic water piping

• insurer will pay the amt of a covered loss in excess of deductible up to applicable limit of insurance as shown in Declarations for each applicable coverage
• apply separately to each applicable coverage
• if more than one covered equip is involved in breakdown, only one highest deductible applies for each of applicable coverages

• abandonment; appraisal; defense; duties in even of loss or damage; insurance under two or more coverages; legal action against the insurer; loss payable clause; other insurance; privilege to adjust with owner; reducing the insured's loss; transfer of rights of reovery against others to insurer; valuation;
• Additonal conditions of Business Income and extra expense coverage - annual reports, adjustment of premium, and coinsurance

additional insured; bankruptcy; concealment, misinterpretation or fraud; liberalization; mortgageholder; no benefit to bailee, policy period, coverage territory; preimium and adjustments; suspension

• to facialiate payment of insurance proceeds when both a Commercial Property Policy issued by one insurer and a Boiler and machinery Policy issued by another insurer in force on the same risk,
• upon a loss - disagreement btw insurers to where there is coverage or the amt of the loss to be paid

• failure of pressure or vacuum equipment
• mechinical failure - rupture caused by centrifugal force
• electrical failure - arcing that causes damage to covered equipment and necessitates its repair
• not include - malfunction, defects, leakage at any valve, damage to any vacuun tube, damage to any structure supporting the covered equip, functioning of any safety device, cracking of any part on internal comustion gas turbine

Net Income that would have been earned or incurred and continuing normal operating expenses incurred including payroll

• equipment build to operate under internall pressure or vacuun
• not include - media; insulating or refractory material; catalysts; vessles, pipping and other equip buried below the ground, structure or cabinet containing the covered equip; vehicle, aircraft, felt, wire, die, grinding disc, machine used solely for research, equip manufactured by insured for sale

property the insured owns or in insured's care and for which insured is legally liable

additional cost insured incurs to operate their business during the period of restoration

if an initial breakdown causes other breakdowns all will be considered one breakdown; all breakdowns at any one premises that manifest themselves at the same time and are the direct result of the same cause

period that begins at the time of breakdown or 24 hrs before the insurer receives notice of breakdown and ends 5 consecutive days after the date when damaged property is reapired with resonable speed and similar quality

• changes loss valuation from replacement cost to ACV
• the valuation will be as of time of breakdown
• insurer will not pay for damaged property that is useless to the insured

• completed and signed by named insured
• used to determine the amt of insurer's payment in loss of income coverage