Subrogation & Recovery Alert
The most recent edition of the NFPA Journal, the Magazine of the National Fire Protection Association, highlights the unique dangers for large buildings under construction and renovation from significant fire damage to those buildings and surrounding properties. The cover story for the September/October 2017 NFPA Journal points out a recent spate of large and costly fires that raises specific concerns for the public, firefighting professionals, property insurers, and subrogation professionals.
The article discusses a $110,000,000 fire at an apartment complex under construction in Waltham, Massachusetts; a fire at a former mill building in Colorado undergoing conversion; a fire at an apartment complex in Raleigh, N.C.; an apartment building fire in Oakland, Calif.; a fire at an apartment complex in Overland Park, Kan.; and a fire at a large warehouse under construction in Bethlehem, Pa. All of the fires occurred in the last several months and involved significant damages. The article focuses on potential issues regarding causes and prevention, including an increased awareness of NFPA 241, Safeguarding Construction, Alteration, and Demolition Operations, a new version of which will be published in 2018. It is also a resource for evaluating potential claims from such fires.
For subrogation professionals, the statistics cited in the article were eye-opening: in a recent NFPA report, the world’s leading fire safety organization found that between 2010 and 2014 there was an annual average of 8,440 fires in buildings under construction or being renovated or demolished. The numbers document that there were nearly two dozen such fires every day, which resulted in an average of 13 civilian deaths per year and over $300,000,000 in direct property damage. Even more surprising was the finding that cooking and heating equipment used by work crews caused more fires in buildings under construction or being renovated or demolished than did hot work involving a torch, burner, or soldering iron. Hot work accounted for 6 percent while cooking and heating equipment accounted for 27 percent of such fires.
Both the statistics from 2010 to 2014 and the recent number of large fires in 2017 suggest that there are, on average, two dozen potential subrogation opportunities each day in such fires.
While not all of those opportunities will result in recoveries, proper early investigation and analysis will increase the chances of doing so.