Water, Wastewater & Pump Systems Manufacturing worked example

Seal Failure Warranty Reserve at 9.2% expected seal failure rate over warranty term: a worked example

Push expected seal failure rate over warranty term up to 9.2% and the picture changes. This example computes every intermediate figure at that operating point. a pump manufacturer needs to provision for mechanical seal warranty claims across an installed fleet of pumps

The inputs for this scenario

  • Pumps under seal warranty: 300 pumps (unchanged)
  • Mechanical seal replacement cost per pump: 650 $ / pump (unchanged)
  • Expected seal failure rate over warranty term: 9.2 % (raised for this scenario; the documented default is 8)
  • Fixed claim administration cost: 5,000 $ (unchanged)

Working through the calculation

  • Applying the documented formula (Total seal warranty reserve = pumps under seal warranty x seal replacement cost per pump x expected seal failure rate + fixed claim handling cost) to the inputs above produces each figure below.
  • At this operating point the engine returns 22,940 $ for total seal failure warranty reserve cost, the number this scenario is built around.
  • At this operating point the engine returns 76.47 $ / piece for seal failure warranty reserve cost per unit.
  • At this operating point the engine returns 17,940 $ for variable seal failure warranty reserve cost.
  • At this operating point the engine returns 5,000 $ for fixed seal failure warranty reserve adder.

How this compares with the baseline

  • Against the tool's baseline example, where expected seal failure rate over warranty term sits at 8% and the headline result is 20,600 $, this scenario comes in 11.36% above the baseline at 22,940 $.
  • It computes the total warranty reserve and per-pump reserve for expected mechanical seal failures across a pump fleet. The value of this scenario is the size of the gap it exposes: that gap, priced out over a year, is the budget you can justify spending to close it.

Results at a glance

  • Total seal failure warranty reserve cost: 22,940 $ (headline result)
  • Seal failure warranty reserve cost per unit: 76.47 $ / piece
  • Variable seal failure warranty reserve cost: 17,940 $
  • Fixed seal failure warranty reserve adder: 5,000 $

Run it with your numbers

  • Every input above is editable in the live Seal Failure Warranty Reserve calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.