What is a “Boiler?” What is a “Pressure vessel?”
The Maine Board of Boiler and Pressure Vessels defines them as follows:
“Boiler” includes power boilers and low pressure boilers and means a closed vessel in which water is heated, steam is generated, steam is superheated, or any combination thereof, under pressure or vacuum for use external to itself by the direct application of heat. “Boiler” also includes fired units for heating or vaporizing liquids other than water where these units are separate from processing systems and complete within themselves. As used in the Board’s rules, the “boiler” includes only those units that are not exempt under 32 M.R.S.A. 15102(1). When referring to power boilers, “boilers” includes boiler external piping.
“Pressure vessel” means a container for the containment of pressure, either internal or external. This pressure may be obtained from an external source, or by the application of heat from a direct or indirect source, chemical reaction, or any combination thereof. As used in the Board’s rules, “pressure vessel” includes only those units that are not exempt under 32 M.R.S.A. 15102(2).
Boilers and pressure vessels (called “objects” for insurance purposes) are vulnerable to breakdown due to pump failure, low water cut-off mechanism failure, control failure, scale build-up and inadequate controls or safety devices. The effect that such a breakdown can have on an agency’s operation and budget should not be underestimated. Repair costs can soar and lack of heat or hot water can shut down a facility and your agency’s operations. An explosion of a mal-functioning boiler or pressure vessel can also put people’s lives at significant risk. Due to these life safety concerns, certain categories of these objects are required to be inspected by the Boiler Division of the Department of Professional and Financial Regulation. To view the Board of Boilers and Pressure Vessels full set of rules, please visit http://www.maine.gov/sos/cec/rules/02/chaps02.htm.
Boiler and machinery insurance (sometimes called equipment breakdown insurance) is available through Risk Management Division. Such insurance serves two purposes. It provides for any State-mandated inspection services and it covers loss resulting from the sudden and accidental breakdown of these objects when such an accident physically damages the object. Realistically, the policy is purchased more for the inspection services than for the actual coverage. Inspections and prompt attention addressing recommendations resulting from inspections prevent losses and injuries from happening in the first place an objective that we all share!
What the boiler and machinery policy does not cover is just as important as what it does cover. It does not cover depletion, deterioration, corrosion, erosion or wear and tear, unless a sudden and accidental breakdown occurs. It will not pay for the cost to repair any defect to an object from which water, other liquid, powder or molten material escapes, unless the defect itself is caused by a sudden and accidental insured event. These are the major exclusions, but there are others. Also, loss payment is contingent upon the actual repair or replacement of the insured object.
Renewing each July 1st, the State's boiler and machinery insurance program is a combination of commercial and self insurance. In a nutshell, here is how that works: Through a competitive bidding process (which takes place every three to five years), Risk Management Division purchases a commercial property policy which includes the boiler and machinery insurance. In order to generate significant premium savings, this commercial policy has a $2,000,000 per accident deductible. Using a self insurance policy, we then reduce this deductible down to one of $500 per occurrence, which becomes the responsibility of the agency suffering the loss. This insurance is not automatic meaning it does not cover objects which have not been reported to our office by your agency and for which a premium has not been paid. The current premium charged is $100 annually for each boiler and $30 annually for each pressure vessel. The per accident limit on the boiler and machinery coverage is $3,000,000.
Call Risk Management Division for individualized insurance advice if your agency:
- Purchases or constructs a new building containing an inspectable object.
- Owns and operates boilers and pressure vessels that are required to receive a State inspection and you have not yet purchased coverage.
- Suffers a loss to a boiler or pressure vessel.
To view additional information, please visit the Risk Management publications web page to view the bulletin entitled "Boilers & Pressure Vessel Inspections".