A pressurized industrial boiler ruptures inside a manufacturing plant, damaging the boiler itself and surrounding equipment. The plant carries a standard commercial property policy with the Special causes-of-loss form. Which statement is MOST accurate?
a.Coinsurance will increase the payment by 25% under the Agreed Value clause, adding a bonus to the boiler settlement once the plant shows it insured the equipment to at least 90% of its replacement cost
b.Loss from steam boiler or pressure vessel rupture is typically excluded and requires a separate Equipment Breakdown (Boiler and Machinery) policy or endorsement
c.The Special form automatically covers the rupture as a windstorm loss, because the pressure released from the vessel is treated as a wind-driven force under the named windstorm peril in the form, so no separate equipment breakdown coverage is needed
d.The Civil Authority extension will respond to the boiler damage and pay to replace the ruptured vessel
Explanation
Standard commercial property forms exclude loss caused by the explosion of steam boilers, steam pipes, steam engines, or steam turbines owned, leased, or operated by the insured. To insure these exposures (and the broader category of mechanical and electrical breakdown), the insured needs a separate Equipment Breakdown / Boiler and Machinery coverage form or endorsement.
Law Reference: Equipment Breakdown (Boiler and Machinery) coverageThis topic, taught in full in the California Property & Casualty Broker-Agent guide. California Property & Casualty Broker-Agent Study Guide — 2026 Edition — PDF + EPUB, $24.99 · 14-day refund →
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