On 18 July 2018, the IING hosted a very informative and topical workshop, A Rational Approach to Risk in a Water Tight Environment, hosted by Rob Hodgkiss, Head of Risk Engineering at Bryte Insurance.
The workshop, which was awarded 4.5 CPD hours, was very well attended by many representatives from the local market, and also as far afield as Brits and Rustenburg. A total of 96 delegates were in attendance.
Rob started the days’ proceedings discussing lessons learned in the Cape Drought environment, and also from the fires near Knysna last year. He mentioned new firefighting strategies employed by municipal teams that have changed from Offensive (contain and fight) to Defensive (contain and protect surroundings).
The drought situation has prompted him and his department to investigate and consider possible alternatives to conventional water-based sprinkler systems that are highly dependant on sufficient water supply, adequate pressure, correct selection and installation and regular maintenance.
Rob also gave examples of various new types of active fire protection systems that are making their way into the marketplace, for example, Pressurised Water Mist systems, Tri-Fluid and Point-of-Ignition systems.
These systems are effective in situations where water is scarce, or the ever-increasing scenario where water pressure or supply of water from the municipalities is unreliable, rendering conventional water-based systems as unpredictable as the supply.
The benefits of new active systems that Rob has identified, and already considered and accepted as alternatives in his day to day work, include rapid intervention at ignition source, vastly reduced water consumption as opposed to traditional systems. Although regular maintenance is still required, it is less complicated than the conventional systems.
Rob also highlighted various Passive Fire Protection mechanisms that could also be considered to reduce the rate of ignition or spread of fire within premises. One of the main factors, and possibly one of the highest sources of building fires, is Incandescent and vapour lighting replaced by LED and CFL lighting. These are more cooling running lighting solutions that substantially reduce the risk of ignition.
Other Passive interventions include Wired Glass, composite lightweight concrete divisions, treatment of steel structures with intumescent paints, thermosetting plastics and treatment but preferably elimination of thatch and timber.
One of the keys to rationally approaching risk is looking at the human behavioural element. In considering risk management, how aware is management as well as the all the staff of fire safety, fire safety management system, impairment systems, and hot work permit requirements in their workplace?
Do they perform self-audits, looking in their environment at potential risks, external audits, swopping stations to check for potential dangers that the accustomed eye may overlook within their workspace? Does the company practice Fire Team drills to attack a potential fire while it is still reasonably possible to do so and extinguish it before it is out of control?
Finally, after presenting examples of the various new technology systems, along with video footage of them in action, participants were encouraged to engage with business sectors, educational facilities, risk engineers, and local municipalities to consider developing codes, standards and solutions around alternative prevention measures to decrease the client’s risk and dependence on traditional water-intensive measures.
Following a break, Mark Thorpe, Senior Risk Engineer at Bryte Insurance, presented to the delegates several factors to consider when looking at risk, mainly construction, occupancy, external hazards and natural hazards.
Mark elaborated on what considerations to give when determining the nature of the building. Is it made from combustible or non-combustible materials? What types of internal fire separations are in place? Party walls and internal communication, for example, open foyers with communication between the floors on a multi-storey building? Building cladding: does the building have advertising hanging over the outside, which renders the slab extension useless?
Occupancy of the building and regulations about the nature of occupancy is extremely important. In the same building, different risk types may attract different requirements to comply with local building codes, which needs to be considered when looking at the client’s risk.
Mark then also explained the standard building code requirements of fire extinguishers required in an area, when sprinklers are generally required and so on, and possible factors to consider in relation to each particular risk. For example, in an office of predominantly women, have two 4.5KG extinguishers instead of a single and heavy 9KG one.
Active fire detection systems are required in terms of regulations when a building height is more than 30m and over 5000m2. The implementation of evacuation procedures and communication of such procedure or plan is significant. All need to be considered and communicated to risk carriers to accurately underwrite a risk.
Mark also explained the Hot Works permit and the applicable purpose behind this requirement. The hot works permit is not just a certificate, but a plan of action around the immediate site where the hot works are to occur and refers to the clearing of potentially flammable materials, erecting screens to prevent sparks from grinding, clearing any potential tripping hazard around the work site.
It is a best practice that the client provides their broker with a copy of the Hot Works Permit to keep offsite. The worst thing that can happen to this permit onsite is to get destroyed in a fire, which means there is no copy for the client to produce to authorities or risk carriers.
There were several factors advised for delegates to consider, not only in respect of mitigating fire risks but something more likely to affect many of our clients: crime. What can we consider and advise clients to minimise their risk in respect of criminal elements?
What type of commodity is at risk; is it high or low in nature? What level of human intervention is in place; how many guards per shift; are they contracted or represent own staff? What communication link do they have access to in the event of an emergency; how long will it take for back-up to arrive?
Although in many instances the guarding is relatively acceptable, it is advisable to still have a linked alarm as a back-up. Chances are guards will not hang around too long in the face of danger to themselves, and having no alternative security will render the building unprotected.
Location and monitoring of CCTV footage are also critical. It is beneficial to have off-site storage rather than on-site as hard drives are regularly stolen to remove video evidence.
Visible deterrents like security gates and burglar bars will make a visible statement that the risk of the extended time it may take to break into the premises may dissuade criminals and drive them to consider another location for their activities.
External Hazards that could affect the risk is also vitally important to consider. What external conditions can affect risk? Does the neighbour’s housekeeping or storage outside his building pose a potential threat to your client? What happens in the communicable area between neighbours? Are there flammable materials stored there, are vehicles parked there after hours etcetera that might pose a risk of communication of fires from one building to another?
How is the risk located in relation to open parks, informal settlements or airports, which pose a higher risk of impact from aircraft, particularly from single-engine planes?
Now more than ever in the thought process of most of the industry professionals after the events of October and December 2017 are natural hazards. Are the risks located within floodplains, on or around hail bands, and are they in areas susceptible to high winds, and potential tornados?
What do clients with large mobile asset risks, e.g. motor dealers, do in the seasons for potential hail storms? Do they have sufficient hail netting for vehicles in the open?
How are clients protected against lightning surges to prevent damage to electronic equipment?
These are seemingly simple questions to professionals in the insurance industry, but very easily overlooked by clients. It is our responsibility to inform and educate the clients as to what best practice is to manage their risks effectively.
The highly informative and thought-provoking session was rounded off by our IING President, Anton Coertzen, concluding that Insurers in this industry should be returning to proper insurance practices.
As an industry, we are far too inclined to walk away from risk due to claims history, rather than to understand risk and to underwrite it accordingly.
Insightful last words from our IING President: “A bad loss ratio does not necessarily mean a bad risk.” Thus, are we as an industry genuinely treating customers fairly?