3 most common causes of business fires

There are 3 main reasons business owners suffer as much as hundreds of thousands of dollars in damages due to fire – and you can avoid becoming another one of those statistics!

Did you know, 43 per cent of businesses that experience a disaster like fire, never re-open?

And 29 per cent close within two years. (source: McGladrey and Pully 2004)Yes! It pays to take precautions.

While there are literally hundreds of potential reasons that fires start, the majority can be traced back to one of three common causes, according to Lumley Insurance National Risk Surveying Manager Lester Lai.

  • Electrical faults
  • Hot work
  • Arson

Here are some real life examples from Lumley Insurance:

In September 2007, the Myer Hobart building burnt down in broad daylight and according to the Tasmania  Fire Service’s report to the Coroner, the most likely cause of the blaze was “overloading” and “failure of electrical wiring” in a ceiling space.

In January 2008, a spark from a welder ignited nearby ethanol fumes at Drayton’s Winery in the Hunter Valley causing a massive explosion that killed two people.

In December 2011, the Nerang Tennis Centre in Queensland was destroyed by an arsonist in one of five suspicious fires on that day.

These fires could potentially have been prevented if these risk factors had been adequately addressed.

Risk 1: Electrical faults

One of the most effective ways to identify potential electrical hot spots is to commission a thermal imaging survey of your premises. This non-intrusive technique detects electrical system and equipment hazards, such as corroded connections, damaged wiring and overheated circuits that are usually not visible to the naked eye.

Another common cause of electrical fires is high density discharge (HID) lights, commonly used in warehouses. These lights are highly hazardous when used over combustible materials because of their propensity to blow fragments of hot shards of glass on the surrounding area. Installing double-shrouded bulbs or covers can help to avoid this problem.

It goes without saying that you should immediately replace any electrical hazards that are visible to the naked eye, such as frayed chords, and only use appropriate equipment in wet/damp locations.

Risk 2: Hot work

Poor supervision of hot work (like welding, grinding and cutting) which can create sparks or embers is responsible for countless fires each year. Implementing a hot work permit system ensures appropriate checks and measures are taken when doing hot work, such:

  • Removal (or shielding) of any combustible materials
  • Surveying the site for any potentially explosive gases/fumes
  • Ensuring the area is adequately ventilated
  • Incorporating a fire watch 30 minutes after the hot works have been completed
  • Have an appropriate fire extinguisher on hand
  • Only permit trained staff and tradesmen to complete hot work on your premises with full supervision by an authorised person.

Risk 3: Arson

The best way to prevent arson is to increase security. Pay special attention to letterbox openings which are a popular place to start a fire.

Probably the best visual deterrent against both arson and theft is a CCTV camera and good lighting.

Ultimately, the way your business addresses risks, including fire, will impact your company’s insurability and premiums – it’s well worth the extra effort!