In a boiler and machinery policy, what does consequential damage refer to?

Consequential damage in a boiler and machinery policy primarily pertains to losses that arise as a result of an incident, rather than from the incident itself. This typically includes business interruption, where the operation of the business is halted due to damage to machinery or equipment. The loss of income during this downtime is a direct consequence of the equipment failure or damage, thus qualifying as consequential damage.

In contrast, other choices focus on different aspects of insurance coverage. Direct damage to equipment refers to the physical damage that occurs to the machinery itself, which does not encapsulate the broader impacts on business operations. Losses due to negligence could involve liability issues but do not address the specific financial repercussions stemming from machinery failures or interruptions. Lastly, injuries caused by machinery relate to liability and workers' compensation, rather than the operational and financial consequences that arise from a halt in business activities. Hence, the selection of business interruption effectively captures the essence of consequential damage as it relates to the impact of equipment failure on overall operations.