All Member Open Forum

Hi All, 
This may be off topic, but I know many of you have  the answers. I also know that some of you will deal with this topic in the future.

I work for an a major commercial insurance company and I am trying to populate one of our mechanical breakdown claims expense estimators. We have to estimate this expense for companies we insure when we evaluate them and at the moment, there is a lot of guessing going on. 
Meaning when an insured customer has a major boiler breakdown requiring weeks or months  to replace or repair their boiler,  they turn to rental companies. There are many around the country that can supply a variety of sizes and types of boiler. 

The issue I am wrestling with is trying to get a feel for the costs of emergency boiler rental  expense around the country.  If any of you have had  any experience with this type of situation and would be so kind  to share the approximate expense incurred in your situation , per month and approximate boiler size (PPH or HP) ,and Type (watertube/firetube) ,  Also if you could include any installation and transportation charges and the distance that would help as well . Obviously, the further the distance the more the freight and  longer, more complicated installations will cost more, but I am just looking to come up with some educated guesses as to  how to approximate these values. Any help would be appreciated. 

As an aside, I find that something that is often overlooked at customers we insure is failure to install hookups for feed, steam, electrical, condensate  to be used in a boiler breakdown scenarios. This can save days, in terms of restoring steam supply via the rental boiler. Depending on what your downtime costs are per day, the benefit is clear. Wouldn't hurt to scope out a supplier and get a feel for the lead time for a boiler that would work in your situation. 

Regards

------------------------------
Hal Puckett
Equipment Breakdown Risk Engineer - Pressure Vessel Inspector, CMRP
Chubb Insurance
Bay Area, CA
------------------------------

Hi, Hal,

I don't think this is off topic at all.  Maintenance and Reliability Professionals should have a handle on these costs as part of the risk management process.  It's critical in deciding maintenance intervals, condition monitoring triggers, and run-to-failure strategies.

That said, it's not only boilers.  I had a situation where an old centrifugal chiller failed while its twin was being replaced, so the partial redundancy was lost.  As I remember  the 50 ton rental unit was about $20k per month turn-key (set-up and transport not billed separately).

My point is, the maintenance team should have a risk assessment and FMEA they can share with you.  Then everyone can understand up front what the consequences will be if a major item falls, and either add redundancy or plan for the contingencies. 

I sincerely hope this helps.

------------------------------
Daniel K Corman, CMRP
Houston, Texas, USA
------------------------------

Original Message:
Sent: 12-08-2021 10:46 PM
From: Hal Puckett
Subject: Emergency Boiler Rental Expense

Hi All,
This may be off topic, but I know many of you have  the answers. I also know that some of you will deal with this topic in the future.

I work for an a major commercial insurance company and I am trying to populate one of our mechanical breakdown claims expense estimators. We have to estimate this expense for companies we insure when we evaluate them and at the moment, there is a lot of guessing going on.
Meaning when an insured customer has a major boiler breakdown requiring weeks or months  to replace or repair their boiler,  they turn to rental companies. There are many around the country that can supply a variety of sizes and types of boiler.

The issue I am wrestling with is trying to get a feel for the costs of emergency boiler rental  expense around the country.  If any of you have had  any experience with this type of situation and would be so kind  to share the approximate expense incurred in your situation , per month and approximate boiler size (PPH or HP) ,and Type (watertube/firetube) ,  Also if you could include any installation and transportation charges and the distance that would help as well . Obviously, the further the distance the more the freight and  longer, more complicated installations will cost more, but I am just looking to come up with some educated guesses as to  how to approximate these values. Any help would be appreciated.

As an aside, I find that something that is often overlooked at customers we insure is failure to install hookups for feed, steam, electrical, condensate  to be used in a boiler breakdown scenarios. This can save days, in terms of restoring steam supply via the rental boiler. Depending on what your downtime costs are per day, the benefit is clear. Wouldn't hurt to scope out a supplier and get a feel for the lead time for a boiler that would work in your situation.

Regards

------------------------------
Hal Puckett
Equipment Breakdown Risk Engineer - Pressure Vessel Inspector, CMRP
Chubb Insurance
Bay Area, CA
------------------------------

Hi Hal,

I work for a company that rents equipment such as Chillers, Boilers and Power Generation equipment. Standard Rates do exist for all Products, but, pieces of equipment do not build a solution to the problem. Additional costs such as tie-in, installation & commissioning would be factored in to the offer. You raise a valid point on the tie-in point with much of the cost coming from the complexity of connecting to an established (and often old) system that did not factor such issues into initial design.

I would suggest reviewing the same with several Vendors in order to achieve an understanding on Market Rates for equipment rental

Regards,


------------------------------
John Pearson
Dubai, United Arab Emirates
------------------------------

Original Message:
Sent: 12-09-2021 09:42 AM
From: Daniel Corman
Subject: Emergency Boiler Rental Expense

Hi, Hal,

I don't think this is off topic at all.  Maintenance and Reliability Professionals should have a handle on these costs as part of the risk management process.  It's critical in deciding maintenance intervals, condition monitoring triggers, and run-to-failure strategies.

That said, it's not only boilers.  I had a situation where an old centrifugal chiller failed while its twin was being replaced, so the partial redundancy was lost.  As I remember  the 50 ton rental unit was about $20k per month turn-key (set-up and transport not billed separately).

My point is, the maintenance team should have a risk assessment and FMEA they can share with you.  Then everyone can understand up front what the consequences will be if a major item falls, and either add redundancy or plan for the contingencies.

I sincerely hope this helps.

------------------------------
Daniel K Corman, CMRP
Houston, Texas, USA

Original Message:
Sent: 12-08-2021 10:46 PM
From: Hal Puckett
Subject: Emergency Boiler Rental Expense

Hi All,
This may be off topic, but I know many of you have  the answers. I also know that some of you will deal with this topic in the future.

I work for an a major commercial insurance company and I am trying to populate one of our mechanical breakdown claims expense estimators. We have to estimate this expense for companies we insure when we evaluate them and at the moment, there is a lot of guessing going on.
Meaning when an insured customer has a major boiler breakdown requiring weeks or months  to replace or repair their boiler,  they turn to rental companies. There are many around the country that can supply a variety of sizes and types of boiler.

The issue I am wrestling with is trying to get a feel for the costs of emergency boiler rental  expense around the country.  If any of you have had  any experience with this type of situation and would be so kind  to share the approximate expense incurred in your situation , per month and approximate boiler size (PPH or HP) ,and Type (watertube/firetube) ,  Also if you could include any installation and transportation charges and the distance that would help as well . Obviously, the further the distance the more the freight and  longer, more complicated installations will cost more, but I am just looking to come up with some educated guesses as to  how to approximate these values. Any help would be appreciated.

As an aside, I find that something that is often overlooked at customers we insure is failure to install hookups for feed, steam, electrical, condensate  to be used in a boiler breakdown scenarios. This can save days, in terms of restoring steam supply via the rental boiler. Depending on what your downtime costs are per day, the benefit is clear. Wouldn't hurt to scope out a supplier and get a feel for the lead time for a boiler that would work in your situation.

Regards

------------------------------
Hal Puckett
Equipment Breakdown Risk Engineer - Pressure Vessel Inspector, CMRP
Chubb Insurance
Bay Area, CA
------------------------------