RIMS executive report includes tips on reducing fire, earthquake, flood risk

RIMS announced Wednesday the release of an executive report on property loss control, which provides advice on fire prevention a well as earthquake, flood and wind risk.

“Although fire remains the most common threat to property, natural hazards such as windstorms (hurricanes, typhoons and tornados), earthquakes, freezing temperatures and floods can also cause loss,” according to the report, titled Introduction to Property Loss Control.

“Regardless of whether a risk manager chooses to retain loss or transfer it to an insurer, the likelihood and severity of losses can be reduced by applying proactive property loss control measures.”

The report is based in part on the notes of Thomas J. Repking, who died in 2011. According to an obituary on the website legacy.com, Repking was a mechanical engineer who worked in the insurance industry. The other contributor to the executive report was Donna Galer, a former executive vice president and chief administrative officer of Zurich Insurance Company Ltd.’s general insurance segment worldwide.

The report noted the use of sprinklers is an important part of a property loss control plan.

“Overall, the sprinkler system and the water supply must be adequate to the hazard in order to be effective,” according to the report. “Although the probability of the automatic system failing is low, human error can be a factor. For example, personnel can forget to reopen sprinkler valves after testing, or inadvertently block sprinkler valves or damage a connection to the water supply.”

Both the U.S. National Fire Protection Association and Factory Mutual Insurance Company (FM Global) “have each developed recommended standards for maintenance and inspection of sprinkler systems and water supplies,” RIMS noted in the report.

To mitigate earthquake risk, the report advises risk managers to ask whether the building code been changed with respect to earthquake resistance since a facility was built, and whether a building was constructed to protect contents as well as to avoid structural failure.

To mitigate against flood risk, the report advises risk managers to develop a “flood-mitigation strategy throughout the facility that addresses overall layout, electrical and mechanical systems, and vital utilities, and applying it during all phases of the site’s lifespan, including design and construction.”

In the section on wind, the report notes that a “very small breach” in a building envelope “can destroy a large area of the interior.”