Fire remains one of the greatest risks across all industries, but is also one that is often underestimated. But which industries are actually the most prone to fire? And how do companies deal with the environmental damage after a fire? These are some of the questions the insulation specialist Rockwool International and Allianz Global Corporate & Specialty discussed in their knowledge exchange.
Rockwool and AGCS talk security and protection
Representatives from Rockwool International recently visited the AGCS headquarters in Munich to meet with AGCS risk consulting experts, specializing in fire prevention and protection in various industries and in many different countries.
Naturally the perspectives of an insurer and of an insulation producer are different, but during their discussion the participants discovered a similar approach and exchanged best practices.
AGCS as a sparring partner
As regards insurance, Rockwool International, as an AGCS client, outlined the factors that convinced them to switch from their long-term insurance partner to Allianz in 2009: AGCS had an excellent reputation, with clear financial security, and had a global reach with subsidiaries all over the world and a substantial network of engineers. They also stressed the extensive dialogue and outstanding collaboration with Allianz Global Corporate & Specialty. Cristina Bildsøe Møller, Insurance Manager at Rockwool International, emphasized: “We wanted a competentsparring partner for our discussions about risk topics, with a high level of expertise. Premium of course always plays a role but was not the main driver – we are prepared to pay for quality.”
Rockwool leading the way in fire protection
The Danish-rooted market leaders Rockwool International are setting a high standard in fire protection: a dedicated fire officer visits their sites all over the world, keeps track of all losses and sends out reports. The insurer is also doing its share; so to increase the frequency of site visits Rockwool International have decided to send their fire officer in those years where AGCS has not planned an inspection to a specific plant. This way every site is checked every 12–15 months. In addition they undergo an internal audit twice a year; and there tends to be competition among the different sites to achieve the best results. These are then published internally as an incentive to good practice. For fire protection standards the Rockwool Group stick to their “Rockwool Bible”, a fire loss prevention manual. Exceptions to this standard need to be approved by their Board of Management.
Rockwool Group are globally active, expanding vigorously in Russia where they are already constructing their fourth plant. Asia also presents an expanding market for both companies. The Rockwool Group have just built a new plant in India and have also acquired plants in China, Thailand and Malaysia. Geographical proximity is essential for Rockwool factories, as insulation materials are so large in volume that transport is very expensive. It does not make economic sense to transport standard products more than 400–600 km. So the company is present all over Europe with plants in Germany, the United Kingdom, the Netherlands, the Nordic Region, France, Spain, Poland, Croatia, Hungary and the Czech Republic. AGCS supports its client and visits about 10 of their plants a year, worldwide.
Active versus passive fire protection
One of the first questions that comes up in the discussion is: what does Allianz consider more important: active or passive fire protection?
Anders Hojman, a risk consultant from Copenhagen, explains that from an insurance perspective both systems are highly important in the fire protection mix. Active measures such as sprinkler systems require energy to keep the fire low or to help drive smoke away from the building. Passive measures simply avoid the danger of contributing to the spread of fire, with non-combustible materials, or stop the fire from spreading by creating permanent fire compartments and fire breaks. If they are made of non-combustible and non-smokegenerating components, they also help to keep the rest of the building free of smoke.
For various reasons, including economic factors, feasibility and availability, it is not always possible to use only non-combustible materials. If this is the case, the fire safety of a building needs to be improved by other measures such as fire breaks, alternative escape routes, sprinklers and smoke exhaust systems.
The earlier the insurer is involved the better
Rolf Grohs, a fire risk specialist based in AGCS's Munich office, elaborates: “Ideally the building construction uses only non-combustibles, but this is not always the case. However, most of our clients use non-combustible insulation. At Allianz it is very common to have a good dialogue with our clients about upcoming construction projects and this way we can give our clients tips on the best way to fire-protect their plants.”
He continues: “Looking at fire loads in both building construction and occupancy is essential. In case of a fire all these factors are important. Particularly, steel deck flat roofs containing large areas of combustible materials can easily support fire spreading all over the plant. It is our job to evaluate the overall risk situation – insulation certainly is one among many different issues to be considered.”
In which industries does insulation play the largest role?
The pharmaceutical industry, industrial production for electrical companies – from clean rooms to semi-conductors – and noise testing rooms are among the most vulnerable to fire risks. These industries are highly sensitive to smoke development that can contaminate a large area. In practice, business interruption due to smoke contamination causes bigger losses than material damage to goods, technology or the building itself.
But also, in the food industry, cold rooms are especially interesting from an insulation point of view as they require a lot of material, with really thick walls, which is quite expensive. Who would have thought of fire when considering cold rooms? In fact, there have been a number of fire cases in the food industry, many of them involving combustible-core sandwich panels. A recent example is a fire at the Heinz factory in Norwich in May this year.
The Rockwool Group are also concerned about the environmental damage caused by fire. How does AGCS deal with these? The risk consultants explain that any fire may lead to smoke development and environmental pollution due to contaminated water. This is why, for example in Germany, there is a requirement for the industry to collect all contaminated water.
Another question that comes up is: Do many companies go out of business as a result of fires? This certainly has happened to smaller and mid-sized companies which are highly dependent on one single production site and might not have considered their substantial business interruption risks, but it is very rare for AGCS's large industrial clients.
The industry tends to use better fire protection (including mainly non-combustible insulation materials) than private housing or even the public sector. AGCS risk engineers, who often play a consultative role with clients, say from their experience that their clients are aware of the importance of non-combustible materials, but some times wrongly assume that “flame-retardant” means that the material will not burn.
Miroslav Smolka, fire safety manager and public affairs specialist at Rockwool International comments: “There are large differences between fire regulations in different countries even within Europe (e.g. Germany and Poland). Hence a building or a component which is considered safe in one country would not be approved for use in another. It is very important to know about the local variations but also to stick to a high global standard and follow best practices. Just complying with local regulations is not always enough to prevent a major, devastating fire.”
Preventing devastating fires is what it’s all about. And much can still be achieved with the combined efforts of building owners and specialists from both their insurance company and the providers of fire protection solutions.