Alarming The Insurance Company

The perspective from the Risk Insurance Industry; The most common problems we see, and recommendations to overcome them.

Presented by: Nicole LeBlanc

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Alarming The Insurance Company

• The Inspection Process

• Insurability

• Common Problems and Recommendations

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The Inspection Process

• Types of Occupancies We See

• Types of Occupancies Where We See Fire Alarms

• Types of Occupancies Where We Require Fire Alarms

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Types of Occupancies We See

• Commercial properties

• Three main areas of focus: fire, crime, liability

• “Jack of all trades”

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Types of Occupancies Where We See Fire Alarms

• Habitational

• Assembly

Do NOT typically see in:

• Retail/Mercantile

• Manufacturing (unless sprinklered)

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Types of Occupancies Where We Ask For Fire Alarms

• Life Safety

− Habitational

− Restaurants with apartments above (suppression system tied in to alarm panel)

• Property

− Water damage in sprinklered buildings (look for alarms on pressure, flow and gate)

− High valued stock

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Insurability

• The “soft sell” approach

• AHJ for insurance purposes only

• Can be tied to rating depending on insurer

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Rating Sample (Illustrates the Weakness of the Insurance Industry in Understanding Fire Alarms)

Requirements

− Detectors installed throughout entire building in accordance with NFPA standards

− Alarm signals are transmitted in a reliable manner− System is inspected semi-annually by a reliable service organization− Detectors and transmitters are listed and receiving equipment either

listed or capable of operating in a satisfactory manner. (A listed central station is acceptable.)

− Duplicate power supplies and circuit supervision are provided in accordance with NFPA standards

• Full Protection (system fully in accord with NFPA standards) – 20%

• Partial Protection (system not fully in compliance with NFPA standards) – 10%

* For buildings classified as sprinklered multiply these credits by 0.50

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Common Problems Seen By Insurance Inspectors And What We Can Recommend

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Absence of alarm protection where required

• Solution: Contact a reputable fire alarm company to have a CFAA or ECAO licensed technician install alarm protection in accordance with the OBC and CAN/ULC-S524

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: System not maintained

• Solution: Contact a reputable fire alarm company to schedule annual servicing in accordance with OFC and CAN/ULC –S536

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: No sticker on the panel, sticker out of date, company no longer in business, or multiple stickers with no clear indication as to who is maintaining.

• Solution: Request copy of the CAN/ULC -S536 inspection report.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Customer does not have, or can not locate a copy of the last inspection report.

• Solution: Co-ordinate with the customer, co-operate with insurers requesting copies of reports/information. Lack of compliance to produce report = recommendation. Non-compliance of recommendation = cancellation.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Lack of communication between customer, alarm company, and insurer.

• Solution: Develop and strengthen insurance and contractor relationships.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Battery operated smoke detectors

• Solution: Hardwired detectors.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Speaker system that is tampered with in residential apartments.

• Solution: Silence function.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: System only sounds locally, where insurance requires monitoring.

• Solution: Supervision/Connection to a ULC listed monitoring station.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: System is monitored by a non-ULC listed supervisory station.

• Solution: Use of a ULC listed supervisory station in accordance with CAN/ULC-S561 as required by OBC.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Limited number of enforcement agencies

− Fire Inspectors (OFM, municipal fire services)

− Insurance Inspectors

− Fire alarm technicians

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: We don’t know what we don’t know

• Solution: More education for the insurance industry on fire alarm systems.

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Common Problems Seen by Insurance Inspectors and What We Can Recommend

• Problem: Fire alarm technician, insurance inspector and OFM disagree.

• Solution: Consistency would be ideal and generally our recommendations do support each other however where a system may be otherwise grandfathered insurers have the right to request upgrades/retrofits for insurability purposes.

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Alarming The Insurance Industry

Questions?