As per API 580, failure is typically defined in terms of a breach in the pressure boundary — most clearly indicated by loss of containment. In Section 5.2, API 580 explains the fundamental focus of RBI:

“One objective of RBI is to determine what incident could occur (consequence) in the event of an equipment failure and how likely (probability) it is that the incident could happen. For example, if a pressure vessel subject to damage from corrosion under insulation develops a leak, a variety of consequences could occur.”

This leak constitutes a loss of containment and is therefore categorized as a failure.

Other options are not necessarily defined as equipment failures:

B (corrosion beyond allowance) is degradation, but failure only occurs if it breaches containment.

C (end of service life) is a lifecycle condition, not a failure by definition.

D (fire or explosion) are consequences of a failure, not the failure itself.