A policyholder has an equipment breakdown policy with a $200,000 limit. After a boiler explosion causing various damages, how much will the insured collect under the policy?

The equipment breakdown policy provides coverage up to its specified limit, which in this case is $200,000. To determine how much the insured will collect, we must consider the nature of the damages and whether they total up to the policy limit or not.

If the total damages incurred from the boiler explosion amount to $175,000, then the insured would collect precisely that amount under the policy. The limit of the policy signifies the maximum payout available, but if the damages don't reach that limit, the insured only receives compensation for the actual incurred losses.

Therefore, in this scenario, the insured would collect $175,000 because it accurately reflects the damages sustained while also being less than the policy limit. This ensures that the policy serves to reimburse the policyholder for their actual financial loss, which aligns with the principles of risk management and insurance.