Filed Under:Risk Management, Loss Control

Don’t Forget Fire In Property-Protection Plans

Simple preventative steps can go a long way to keeping an organization’s assets from going up in smoke

As risk managers implement property-protection plans in preparation for an above-average hurricane season—that follows hard on one of the most active tornado seasons in U.S. history—it is no surprise that the seemingly more mundane threat of fire has been put on the back burner.

Yet while risk managers’ focus has rested, rightfully so, on the immediate threats presented by an overactive weather pattern, fire remains one of the most-costly commercial-property loss drivers. 

Although the incidence of fire has shown a steady decrease over the last 30 years, the average cost-of-fire loss has increased, according to the National Fire Protection Association (NFPA). Agents, brokers and insurers can help risk managers keep fire safety a top priority throughout the year by identifying those areas most vulnerable to fire loss and helping risk managers maintain an active fire-prevention strategy.

A good first step in addressing vulnerable areas is to identify the locations and causes of fire that inflict the greatest amount of property damage. According to the NFPA, some of the most common points of origin for fire in commercial occupancies are: 

  • Attic spaces and roof assemblies, which account for only 3 percent of fires in office occupancies but result in a disproportionate 15 percent of direct property damage.
  • Flammable liquids in industrial and manufacturing occupancies, which account for 10 percent of fires and 12 percent of direct property damage.
  • Electric wire and cable insulation, which contribute to 6 percent of fires and 7 percent of direct property damage in industrial and manufacturing occupancies.


Once a problem area is identified, what are the next steps? First, risk managers should conduct an evaluation of their property’s sprinkler systems. NFPA research shows that the average loss per fire was 60 percent lower in office occupancies when an automatic-suppression system was present.

However, suppression systems are not one-size-fits-all, and the system must be appropriate for the occupancy being protected. Some of the key questions to ask during the sprinkler evaluation include: 

  • Are all areas of the building protected properly, and is that protection properly maintained?
  • Are combustible concealed spaces, such as those above a ceiling, protected by a sprinkler system? If not, perhaps the existing system can be extended into this area or a new system can be installed to provide such protection.
  • If there is an existing system, has it been serviced recently to verify that it is functioning? It is a well-known fact that a properly maintained sprinkler system is highly effective in containing or even extinguishing a fire.
  • Has the configuration of the area, or the material being stored there, recently changed; and, if so, does the current sprinkler system provide the same level of protection?

One of the most important aspects of any fire-protection program is to ensure that any installed sprinkler system is properly inspected, tested and maintained. According to the NFPA, three of the top causes of sprinkler-system failures are: 1) system shut off; 2) inadequate maintenance; and 3) obstruction to distribution. For locations where there is a properly trained maintenance staff, system-maintenance costs can be kept to a minimum by completing some inspection and testing activities in-house. 

One activity that can help prevent the most common cause of sprinkler-system failure—a shut water-supply valve—is inspection of the fire-protection control valves to ensure they are open. Fire-protection valves must be “indicating,” meaning that they must offer some visual indication of their open or shut status. Monthly inspection of these system-control valves to ensure the valves are open does not take a lot of time and is the best way to guarantee a building’s sprinkler system will work when needed. 

By simply standing on the facility floor and looking up, the entire sprinkler system can be easily inspected for any potential obstructions to sprinkler discharge by looking at the sprinklers and making sure that there is at least 18 inches of clear space below them. Providing 18 inches of clear space below the sprinkler will ensure that an adequate water-spray pattern develops.

Two additional preventative measures that can be completed by in-house maintenance staff are the semi-annual alarm and annual drain testing. The alarm test is completed by opening a test connection causing water to flow past the waterflow switch. The system should go into an alarm condition within 90 seconds. If it does not, the switch can be adjusted; or if no alarm is received at all, the system should be inspected thoroughly to determine why it malfunctioned. 

The drain test is a simple evaluation of the water-supply-control valves:

  • Record the static or non-flowing pressure from the rmanently attached pressure gauge.
  • J Then, open the two-inch drain valve to discharge the water and record the residual or flowing-pressure.
  • Next, close the drain valve and note how much time it takes for the pressure to return to the static level previously recorded.
  • Finally, compare pressures to previous test results to determine if there is deterioration in the water supply. 

If it takes a long time for the pressure to return to normal, this could be an indication of a partially closed water-supply-control valve. For more sophisticated testing and maintenance such as testing dry pipe systems or fire pumps, companies should hire a licensed contractor.


Closely tied to regular inspection and testing of the suppression systems is the proper storage and maintenance of materials. The amount and type of flammable and combustible liquids present varies depending on a company’s occupancy and operations—but be assured that the majority of companies have exposure to this risk. 

These chemicals present a significant exposure to loss since they ignite easily, burn intensely and result in fires that can be difficult to control and extinguish and can quickly overwhelm a fire-suppression system. An important step in avoiding catastrophic loss involving these liquids is to prevent ignition and fire by using appropriate equipment and handling procedures.

The first level of protection for a flammable liquid is to use an approved safety container. These containers are made of rugged materials, have self-closing lids and are designed to limit spills with leak-proof covers and limit ignition by means of flame arresters in the pour spout. The next level of protection is to limit the amount of liquids in the point-of-use area by only permitting the quantity needed for each activity.

These liquids, even in small quantities, can significantly increase the hazard of an otherwise properly protected area. It is important that this hazard be recognized and properly controlled. If more than four or five one-gallon or larger containers, or 12 or more smaller containers are needed, a storage cabinet should be used to safely store these liquids. The cabinet should be specifically designed to limit vapor production and should be properly grounded to prevent static electricity from igniting vapors.

With all the focus on weather-related losses, it’s easy to forget that fire is still a major risk. But by focusing attention on the major causes of fire and developing a basic strategy to address the root cause of fire in their clients’ facilities, agents, brokers and insurers can help risk managers establish a fire-prevention program that will help reduce the incidence of fire.

A simple and straight-forward inspection, testing and maintenance program for sprinkler systems in each facility will ensure proper operation of the system and increase the likelihood that the system will function as intended in the event of a fire. Even as hurricane season gets into full swing, don’t forget fire! 

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