June 2005 It's Power Surge Season - Are Your Clients Protected? Warmer weather brings the increased risk of equipment damage from lightning, utility breakdowns and other causes of high voltage power surges. Storms and heavy demand for air conditioning lead to millions of dollars in losses because of overloaded electrical circuits. Do your clients have insurance protection that pays for business equipment damaged by power surges, lost income and related expenses? SURGES HAVE MANY SOURCES "The most obvious source of power surges is lightning," said William Bartley, P.E., the principal electrical engineer who establishes electrical standards at HSB, "but these high-energy pulses also can come from normal utility switching operations, or when a power line falls to the ground." IT CAN HAPPEN TO ANYONE Power surges are a leading cause of electrical equipment damage. HSB pays thousands of claims for equipment damage and related expenses due to manmade power surges each year in commercial locations. Virtually any of your clients could have a surge-related breakdown like these: High Rise, High Cost Air conditioning was lost in a luxury high-rise hotel when operators started chilled water pumps without opening all the valves and the chiller unit broke down. A temporary chiller system had to be hard-piped through the garage to the roof. Repair Cost Business Interruption Total Paid Loss $119,495 $476,945 $594,440 This example summarizes actual losses and coverage. For all terms, conditions and exclusions, consult the actual policy. Air Conditioning Losses Rise With The Temperature It's no surprise that summer is the peak time for air conditioning losses. HSB monthly claim data shows that air conditioning breakdowns occur most frequently in June and July as systems work hard to cope with heat and humidity. A compressor may be worth $20,000 or more. A centrifugal chiller might cost as much as $40,000 to replace. Lost income can total much more. But many air conditioning breakdowns can be prevented. Your clients can learn more about proper maintenance and operation by visiting the Equipment Care section of our website. Ten Facts About Power Surges Most people think of lightning and utility breakdowns as the cause of power surges. But damaging voltage spikes can also originate from other sources. What does turning on a light switch have to do with understanding power surges? How can your clients protect their equipment? And how can a utility blackout cause a power surge, anyway? Here are 10 facts you should know about electrical power surges. Electrical equipment is now a critical component of virtually every type of business. What percentage of equipment breakdowns do you estimate are caused by power surges and other power quality problems? Click your answer below: •  25-49% •  50-75% •  More than 75% Hartford Steam Boiler - One State Street - P.O. Box 5024 - Hartford, CT 06102-5024 Phone: 860-722-1866 - Fax: 860-722-5106 ©1996-2006 The Hartford Steam Boiler Inspection and Insurance Company. All rights reserved. <%=imagepath%>