Bearing generally fail when they are loaded in a way for what they are not designed. For example when a simple ball bearing is loaded axially, the bearing cage is likely to fail. The balls in a ball bearing also fail due to crushing and fatigue. Generally ball bearings rarely fail due to radial overloading due to high safety factor kept while designing them.

I saw this topic on the day it was posted and wanted to reply then but work has been really busy lately. Good thing you tagged me in zaveri. It was a good reminder.
Anyway:

1. This is a very good question. There are four main reasons why a bearing would fail. Firstly, 'Poor Fitting'. During installation, if the right tools and method are not used you can end up damaging the bearing or even the shaft. This is evident where bearings are pressed unto a shaft where you should not press on the outer race of the bearing or you can risk damaging the balls even before the bearing is put into service. In this case a Bearing Induction Heater can be used. This heater expands the inner race of the bearing which can then be easily slipped unto the shaft. Furthermore to installation, the dimensional clearances of your shaft or bearing housing is critical to your bearing life. High interference fits can put too much strain on the bearing balls and this high pre-load can even damaging them in the process. So it is important also to design your shaft and housing with the proper clearance. Usually the bearing manufacturer would recommend the ideal tolerances. Then there is 'Poor Lubrication'. Wrong or poor lubrication can reduce the life of a bearing. Preventative Maintenance is important. Sadly most places you go don't take PM serious and therefore poor lubrication is a big reason why bearings fail prematurely. 'Contamination' is also another cause of bearing failures. It is important to seal your bearings from contamination. If you are using oil lubrication you should frequently filter or change your oil. Lastly there is 'Fatigue' which is caused by overloaded bearings or bearing that were not properly sized for the application.
2. The answer to your second question is stated above. In this situation you described what can cause the bearing to seize is contamination from particles or water from the outside. Improper lubrication creates too much frictional resistance and since its in 24/7 service it can get very hot and thermal expansion can seize the bearing. Type of lubrication whether oil or grease should also be considered. In my experience I have found that bearings that are spinning at high rpm tend to push the grease away from itself due to the high centrifugal forces. You may want to consider oil in this application. If the bearing balls deform or wear out badly the shaft would seize since it is the balls that transfer the rotational motion.

CE Designer

I saw this topic on the day it was posted and wanted to reply then but work has been really busy lately. Good thing you tagged me in zaveri. It was a good reminder.
Anyway:

Thanks for your time and to you to give an understandable explanation.We are missing your contributions.
I have a little doubt.Which "FIT" among the three fits were very efficient for power transmission purposes?

dear,
about your second question, as you mentioned that bearing is fully immersed in grease. so its obvious that the chance of wear between internal and external race with ball bearing is less or too low.
So now as you also mentioned that the machines is working 24 x 7, so its clear that we cannot consider static load carrying capacity.
So this is the case of dynamic lad carrying capacity, means the bearing will fail only because of fatigue failure.
So simply if the dynamic load carrying capacity of bearing is less or start decreasing because of fluctuating load as compared to the dynamic load acting on the bearing, then the bearing will fail.

I hope its clear to you , if any doubt fell free to ask....