Builders' Risk Fires - Need for different controls

The surge in large loss fires in frame construction projects is not a new event. I began discussing this type of loss in 2000 following  a large fire in Ybor City. I did not learn about this from insurance sources, but from my work as a training officer in the fire department. The topic was “Conflagrations” and how they were outside the experience of most fire departments. Twenty years later this remains the case and despite paying the monetary losses, the insurance industry is also grasping at straws to deal with this exposure.

Genesis of the problem

The beginning of this problem was the unintended consequence of the widespread adoption of NFPA 13R and the building codes allowing all of the sprinkler givebacks for installation of a life safety sprinkler system. Adding additional stories to building, increasing the area, reducing the need for interior fire walls and exterior fire resistance, and allowing closer spacing of buildings changed the economics and layout of multi building developments. While the give backs may be effective and warranted when the building is finished, it aggravates the exposure during construction. The use of podium construction, one floor of concrete and upper floors of frame construction, made the fire spread even faster.

The economy of framing up the entire complex at the same time is a key exposure driver. Allowing a straight-line construction schedule is easier to manage and more efficient. The resulting vertical lumber yard was not a recognized hazard. The reduction in spacing, street width, exterior fire resistance compounded this hazard as a risk factor was not part of the risk assessment.

These are not completed buildings!

This simple observation is the root of the problem. When getting in insurance submissions for builder’s risk coverage, the application always highlighted the fact that the buildings would be sprinklered, have some fire detection and were located in a location with a responding fire department. Given the historic profitability of builder’s risk insurance, these look like a great risk on paper. The final product and the in-process product are not the same!

The sprinklers, detection systems, unit demise walls, fire resistive egress and other provisions that make the building safe when complete are completely absent when the building is at its most vulnerable. When the building is framed and not drywalled, it has the burning characteristics of a pile of idle pallets.

Water Supplies and Fire Department Response

The building codes require a specific fire flow for permitting a development. The International Fire Code has an upper limit of 8,000 gallons per minute. Given completed buildings with sprinkler systems this is a reasonable fire flow. This can be reduced by up to 75% for a sprinklered building. This means the top end of fire flow may be 2,000 GPM for a sprinklered project.

The ISO PPC is irrelevant for these projects. ISO caps its first alarm fire flow at 3500 GPM. It does not calculate fire flow requirements for sprinklered buildings or buildings under construction. Using PPC as a risk indicator is meaningless.

 A recent four-story frame hotel under construction was reported to be 64,000 square feet in area. When estimating the needed fire flow for this risk I included the attic as a separate story since the framing for the attic was also part of the unprotected fuel package. Using the fire flow formula from a National Fire Academy course “Fire Risk Analysis: A systems Approach” released in 1984, the fire flow for this structure exceeded 7,500 GPM. There are very few water supplies that can deliver this flow. There are very few first alarm assignments prepared to deliver this flow quickly. The fires simply race through the structure and the fire department tries to keep it from spreading to other buildings.

Many insurance companies try to address this issue by restricting their writings to the “better” ISO PPC areas or only in areas with paid fire departments. Unfortunately, the fire does not know it is supposed to move slower in different fire districts. The fire did not get the memo that it should behave differently if the responding fire department was paid or volunteer.

Solutions

For single building frame projects there is no immediate solution. As long as the building codes permits these types of buildings, they will burn in a predictable fashion, quickly and completely. This is a retention and re-insurance issue for the insurance carrier. For local fire departments these should be addressed as exposure protection hazards. The pre-plan can be summarized in two words, “Big Water”

For larger multi building projects the solution may be in mandating that buildings that expose one another cannot be in framing stage at the same time. To move along in the project, building must have the minimal exterior fire resistance required achieved before the adjacent structure goes vertical. This would change the available fuel package and make the available fire flow a more meaningful factor. Given the inherent complications of scheduling and the associated increased costs I am not confident that this will be seriously considered or implemented.

The current path of attempting to control ignition sources, increase supervision of the site, install the water supply system for the finished product, and preplan with fire departments are all great ideas. But absent changing the fuel package that is available, they will not materially impact the fire risk. There is limited ability to have adequate water or deliver it fast enough to control the fire.

Outlook

Until the risk transfer costs for this exposure drive behavior change, the number of these fires will be a constant in construction and insurance economics. As long as new companies continue to enter the inland marine market, the cost and availability of this risk transfer will not be the driving factor.

The building code must be changed to address this hazard. If code officials are satisfied that the current results are acceptable, the codes will not change the fuel packages available. Given the consensus process for code development, resistance from the construction trades and development interest would delay changes.