Click here for a printable version of this article.

November 2002: Reducing Property Losses

In a recent issue of the Record, which is a quarterly publication of FM Global, the system of Exposure Driven Engineering was reviewed.

Basically, Exposure Driven Engineering is a concept, which consists of conducting intermediate "mini" property surveys, which concentrate on hazards that are specific to a particular occupancy. The purpose is in an effort to minimize losses.

Normally, large, complex manufacturing facilities receive two property surveys per year, which are all encompassing. All features of a building and process are reviewed, regardless of the fire hazard or potential for a Business Interruption event. Considering the size and complexity of today's manufacturing and warehousing operations, a full property survey can be a multi-day task.

Multiple visits per year are not only limited to manufacturing facilities. Large hotels/motels, high-rise buildings, critical computer centers and some retail operations can have staggering dollar values associated with them, and can benefit from frequent visits.

Another concern is a large modern warehouse. As product demand changes, occupancy classification of the storage in the warehouse may change. It is not uncommon for a warehouse to have a commodity change due to public demand or changes in manufacturing. A fire suppression system designed to protect paper or wood products will not be able to protect plastic goods. Changes in storage arrangement (pallets vs. high rack storage) can also be an issue, as can multi-tenanted warehouses where there is very little control over occupancy.

Utilizing the Exposure Driven Engineering concept, the intermediate visits concentrate on the specific hazards rather than a complete building survey. Manufacturing processes can change quickly in occupancies such as semi-conductor manufacturing or any high-tech industry. New exposures can be introduced at any time, based on product specification change or new product introduction.

While Exposure Driven Engineering is a major step forward in property conservation, it is also important to remember that the basic Human Element programs are equally important, and account for the majority of fire losses.

In a five-year study by the NFPA on causes of fires in various occupancies, the following results were noted:

Industrial and Manufacturing

Cutting and welding operations, faulty electrical equipment, improperly operating heating and air conditioning equipment, smoking, cooking equipment and process equipment failure resulted in 56% of the reported fire losses. An additional 15% of the reported losses were the result of fires of incendiary or suspicious origin, exposure fires and natural causes.

Offices

Faulty electrical equipment, smoking, cutting and welding, heating and air conditioning equipment and cooking equipment resulted in 60% of the reported losses. An additional 22.6% of the reported losses were the result of fires of incendiary or suspicious origin, exposure fires and natural causes.

Hotels

Cooking equipment, heating and air conditioning equipment, smoking, electrical distribution systems and cutting and welding operations resulted in 66.3% of the reported losses. An additional 20.1% of the reported losses were the result of fires of incendiary or suspicious origin, exposure fires and natural causes.

Concepts such as Exposure Driven Engineering, employee training, plan review for new construction and/or manufacturing operations, proper maintenance of equipment and attention to the basic Human Element programs, all will result in reduced production downtime, and help to minimize property losses.

For more information on how Risk Logic can help you to minimize your exposures or conduct a comprehensive property survey, please contact us.