Endorsements Used to Modify the Equipment Breakdown Protection Coverage Form

Summary: The Insurance Services Office (ISO) program for boiler and machinery contains miscellaneous endorsements used to modify the boiler and machinery property damage forms. The endorsements are described in alphabetical order. Following is a brief description of each form.

Alphabetical Guide to Endorsements:

Actual cash value BM 99 59
Amendment of declarations BM 99 51
Pressure of vacuum equipment BM 99 55
Production machinery exclusion BM 99 57
Refrigeration interruption coverage BM 15 39
Report of total insurable value BM 99 53
Turbine units explosion coverage BM 99 52

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Actual Cash Value BM 99 59

When an insured or the insurer, for underwriting reasons on older equipment, wishes to insure property loss by covered accidents on an actual cash value (ACV) basis rather at full replacement cost, endorsement BM 99 59 07 01 is used. The endorsement contains a schedule of locations and covered equipment to be insured for ACV. Under this endorsement, the insurer agrees to pay the amount spent by the named insured to repair or replace covered property that is directly damaged by a breakdown. But this payment will be the lesser of: the cost to repair or replace the damaged property with property of same kind, capacity, size or quality; or, actual cash value of the damaged property.

The valuation of covered property will be as of the time of breakdown. And, the insurer will not pay for damaged property that is obsolete and useless to the named insured.