A manufacturing plant's electrical transformer fails due to an internal short circuit. The Commercial Property Special Form (open peril) will NOT pay this loss because:

Why this is the answer

Standard commercial property policies — even the broadest open-peril Special Form — contain an exclusion for mechanical breakdown, electrical breakdown, and latent defect. This exclusion exists because these losses are considered maintenance or wear-and-tear, not fortuitous events. Equipment Breakdown (formerly called Boiler & Machinery) coverage is a separate policy or endorsement that fills this gap. It covers sudden and accidental breakdown of covered equipment including boilers, pressure vessels, mechanical systems, electrical systems, and computerized equipment. Coverage includes direct physical damage to the equipment plus resulting damage to other property and business income loss. See FL Outline §I.C.2.