Overview: Boiler and Machinery Coverage

Boiler and Machinery coverage isn’t on the forefront of most people’s minds. It is the type of coverage that we only think about when something goes wrong. To lessen the chance of something going wrong, the Commonwealth of Virginia has statutory inspection requirements in place for pressurized equipment.

What is Boiler and Machinery coverage?

The Boiler and Machinery Policy is a type of property insurance providing coverage not included in the standard property policy.  There are three major types of claims covered in this policy.

  1. Explosion of Pressurized Equipment (i.e., furnaces used for heating, large hot water heaters, and air tanks that supply pressure for pneumatic equipment)
  2. Subsequent damage caused by a mechanical breakdown of equipment  (i.e., foreign matter causing a submersible pump impeller to seize up which in turn could cause the unit to overheat and fail)
  3. Loss due to electrical arcing (i.e., electrical arcing causing damage to a central air conditioning system or to electrical panels and transformers)

A key item to remember is that boiler and machinery coverage is needed even when you do not have pressure-fired equipment.  Standard property policies do not cover the types of claims listed above.

If you do not have boiler and machinery coverage, you could have a property loss that would be excluded in the standard property policy.

Who regulates boiler inspections?

Boiler inspections are required by law and regulated by the Virginia Department of Labor and Industry (DOLI). The Code of Virginia states that “all boilers and pressure vessels in the Commonwealth must be registered with the Department of Labor and Industry unless specifically exempted from the Code.”

Boiler inspectionHere are a few boiler inspection facts from the DOLI website:

  • High pressure boilers (steam boiler more than 15 psi or hot water boiler more than 160 psi) are to be inspected annually;
  • Heating boilers are to be inspected every two years;
  • Pressure vessels are to be inspected every two years;
  • DOLI licenses boiler inspectors;
  • The inspectors work for insurance companies or boiler inspection companies; and
  • It is the owner’s responsibility to make sure the certificate is up to date.

Who performs VML Insurance Programs’ (VMLIP) boiler inspections?

For members of VMLIP that have boiler and machinery coverage, these inspections are conducted by ARISE, Inc., an authorized inspection agency. If your boiler and machinery coverage is with VMLIP it is important that you verify that any inspector coming to inspect your equipment is an ARISE, Inc. employee.

IMG_5624_January13Inspection costs are included in the boiler and machinery premium and are designed to limit the possibility of the explosion hazard that is covered by the boiler and machinery policy.  It is important to note that while the inspection cost is paid for by your insurance premium, members are responsible for the fee collected by the DOLI to handle the filing costs associated with the inspection process. Also, if an inspector other than an ARISE, Inc. employee performs the inspection, additional fees could be incurred.

How to prepare for a boiler inspection

“Proper preparation of equipment for inspection is of utmost importance,” states Jerry L. Sturch, CSP, Chief of Engineering Operations at ARISE, Inc. “Failure to properly prepare the boiler could prevent the inspector from completing a proper inspection.”

Here is a brief list of preparations to perform prior to an internal inspection:

  • Shutdown the boiler and allow to cool for a minimum of 24 to 48 hours prior to opening;
  • Draw off all water from the boiler;
  • Implement proper lockout procedures;
  • Remove manhole covers and hand hole plates and/or washout plugs;
  • Remove inspection plugs/caps; and
  • Ensure that operating certificates are posted.

Sturch further explains, “External inspections of boilers are completed to determine if the operating controls and safety devices of a boiler are capable of protecting the boiler from operating in an unsafe manner and/or are capable of shutting down the boiler in the event of an unsafe condition.”

These are the areas that make up a complete external inspection:

  • Low Water Protection/Prevention;
  • Safety and Safety/Relief Valves;
  • Combustion Safety Controls;
  • Gage Glass;
  • Hot Water Heating System Trim (Includes Expansion Tank); and Make-up Regulator/Reducing Valve.

Boilers are an important part of our daily lives in the transfer of energy from fuels to the heat source. The purpose of boiler inspections, in addition to fulfilling a legal requirement, is to help you ensure that your equipment remains safe to operate.

For more detailed information about boiler inspections contact Greg Dickie, Director of Member Services or your underwriter at (800) 963-6800.

VMLIP offers more than just coverage.  We are partners in risk management. How does your insurer stack up?  Having all lines of coverage with VMLIP ensures that your organization is receiving comprehensive coverage and a wide variety of value-added services tailored to Virginia’s local governmental entities.  Call for a quote today: (800) 963-6800.  For more information on VMLIP visit: www.vmlins.org or follow us on Facebook.

** VMLIP blog postings are offered for VMLIP members to utilize in strengthening their risk management efforts.  See copyright information for clarification on sharing this information.

About VML Insurance Programs

Director of Communications, VML Insurance Programs
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