Fire Performance Network Tim Humphreys ABI Fire Performance Network

Recent developments in fire insurance claims Insurers are very concerned about the increasing cost of fire losses, which rose by 16% between 2007 and 2008 to £1.3bn Business Interruption claims cost a further £200m per year Insurers are reporting more multi-million pound claims Insurers agree that the number of fires is decreasing but the average cost of fire is increasing

Slide 1 – Cost of fire claims notified in the UK, £M, 1988-2008

Slide 2 – Deaths from fires 1996-2006

Slide 3 – Number of Fires in UK, thousands, 1981-2007

Slide 4 - Average Cost of a fire claim 2002-2008

Fire and Recession The is a link between recession and certain types of crime, for example burglary During the last recession (1990-93) the number of arson fires increased from 53,000-80,000 Recession is also likely to increase the number of fraudulent and malicious cases of arson Around half of all fires at business premises are caused by arson and about a fifth of house fires are caused by arson

Proposals to reduce arson We all need to work together to reduce arson Police and FRSs need to work more closely together to target arsonists and to bring them to justice The insurance industry should focus more resources on detecting arson and publicising cases of arsonists that have been caught and had their claims turned down Insurance and FRS investigators should work more closely together to minimise the chances of successful fraudulent arson

The case for sprinklers Insurers agree that sprinklers are key to minimising fire damage once a fire has started England allows unusually large buildings to be built without sprinklers Insurers would like to see the more widespread use of sprinklers but the competitive insurance market means they cannot require them across the board The cost/benefit case for sprinklers should be re examined against the background of the increasing cost of fire claims Cost/benefit case should include the costs to wider society and economy of fire Governments of the UK should commission this work, overseen by a broad stakeholder project Board

Other factors Insurers are also concerned about increasing response times; possible allocation of resources away from the commercial estate and firefighting tactics Modern methods of construction and the performance of these buildings during fires

Performance Indicator We think it would be helpful for Chief Fire Officers to include the economic cost of fire in their areas as an indicator of performance For this to be effective a credible measure of the economic cost of fire in FRS areas needs to be developed This would need to be more sophisticated than the current data available from, say, to Entec work on the economic cost of fire The FPA could also supply tailored data to each FRS on the cost of fires in their areas

What is the ABI doing about the increasing cost of fire? We have developed a draft policy paper on fire issues which includes proposals to reduce the number and cost of fires The paper will be launched in Parliament on Thursday Proposals include setting local targets to reduce economic losses FPA to provide local FRSs with details of large looses in their areas National campaigns to reduce arson Insurers, business groups and others promoting fire risk management in businesses Review of the evidence base on the benefits of sprinklers overseen by an independent Project Board Widely endorsed guidance on the benefits of sprinklers A task force to look at the fire performance of MMC buildings

Questions Is it desirable to have a agreed economic cost of fire indicator? Can we improve currently available data? How can we work together towards a common understanding of the economic cost of fire and how can we reduce it?