A fire in your Colorado or Denver business can be extremely costly. In addition to the costs associated with fixing the damages, there is also a good chance that your day-to-day business activities will be interrupted during the repairs. To avoid potential expenses related to workplace fires, it is important that you have adequate fire coverage. Fire coverage is included as part of most property insurance policies for commercial buildings. However, it is important that you understand your policy to make sure it provides all the protection you need and that you are paying the right amount in premiums. Please contact Orcutt Insurance Group to discuss fire protection and your business.
Types of Coverage
There are two primary factors that come into play when dealing with fire protection. Make sure your coverage incorporates them both to make sure you won’t be left holding the bill.
Commercial Property – This is the portion of your policy that kicks in to cover the building itself and the equipment/business property in it. When there is a loss to physical assets caused by a fire, this is what pays for replacement and repair costs.
Commercial Casualty – In the aftermath of a fire, there may be a time period where you may not be able to conduct business, often due to damaged workspace. This part of your policy will cover loss of revenue during the recovery period after a fire.
Based on your policy, these coverages will offer different levels of protection. Review your situation to make sure that the amount of coverage is comparable to your potential risks.
Fire Sprinkler System Credit
You can greatly reduce your premiums for fire coverage by installing a sprinkler alarm system. With some insurance providers offering 10-60 percent discounts, systems can quickly pay for themselves. However, to get your full credit, you have to make sure that your system is reviewed.
According to the Insurance Services Office, Inc. (ISO), many organizations receive partial to no credit on their Fire Insurance for having a fire sprinkler system in place. This is because the facility and the sprinkler system have not been properly inspected in order to provide full credit. Yet, at the request of your insurance company, ISO can inspect your facility and develop an accurate credit on your Fire Insurance, which will reduce your overhead costs and, in turn, increase your bottom line.
Fire Sprinkler Evaluation Process
The ISO fire sprinkler evaluation process consists of a review of the following areas:
- System design based on the requirements of occupancy
- Available water supply
- System installation and components
- System testing
- Inspection of areas of the building without sprinklers
- Building conditions affecting the sprinkler operation
Necessary Testing and Certifications
The following must be reviewed or completed before receiving an ISO credit:
- Main Drain Test
- Copy of the Underground and Overhead Piping Hydraulic Test Certificate
- Dry Pipe Trip Test Results (systems with dry pipe valves only)
- Fire Pump Performance Test Results (systems with fire pumps only)
- System Design Criteria Evaluation (through a review of the sprinkler plans, hydraulic calculations or hydraulic data plaque information)
Thank you for your consideration.
The Orcutt Group Team