Fires in medical facilities can place complex and time-sensitive burdens on business owners and administrators. While your priority may be to keep your hospital or small clinic open without any business interruptions, the challenges and costs of rebuilding can force closures and financial instability. Attorney Bill Voss addresses the most common causes of fires in health care centers, and offers insight on potential insurance extensions that can strengthen your commercial property damage policy.
Common Causes of Fires in Hospitals and Health Care Centers
According to a recent report from the Federal Emergency Management Agency (FEMA) and the National Fire Protection Association (NFPA), U.S. fire departments responded to approximately 5,700 fires in medical facilities between 2012 and 2014. Nearly a third of these fires were unconfined, spreading beyond the room of origin and causing widespread structural damage. In addition to numerous deaths and injuries, fires in health care centers and hospitals resulted in nearly $5 million in property losses per year.
The major causes of these fires included:
- Cooking equipment. The vast majority of hospital fires were caused by food preparation, with cooking activities accounting for 68% of all hospital fires. These fires occurred most frequently during the day, peaking during lunchtime meal preparations (between 12:00 pm and 1:00 pm).
- Trash fires. Fires in incinerators, compactors, and trash bins composed 10% of hospital fires.
- Heating and fuel. Fuel burners, chimneys, and other heating elements caused 5% of all hospital fires.
- Electrical malfunction. Electrical fires, such as those sparked from faulty wiring or defective appliances, caused 22% of all unconfined fires over the two-year period.
Fire Insurance Claims for Medical Facilities May Be Underpaid
The best way to ensure fair coverage after a fire is to carefully tailor your policy to the specific healthcare services you provide, ensuring your policy limit will be enough even in a worst-case scenario. Without appropriate and adequate coverage, a fire damage claim may be underpaid or outright denied.
Insurance selections that may provide additional benefits to hospital administrators or solo practitioners include:
- Building ordinance coverage. Even if a fire is contained to a single area, hospitals and clinics are required to adhere to safety regulations that can prevent them from admitting patients until repairs are complete. Building ordinance insurance provides payment for the increased costs of building code upgrades and health department compliance.
- Equipment breakdown. The mechanical breakdown of specialized equipment such as CAT scan or MRI machines could easily put your claim over the policy limit. Expensive diagnostic equipment, patient beds, scanners, and other machinery may be covered under a separate deductible or protected under an endorsement for specialized medical equipment. If your medical facility leases medical equipment from a vendor or lending hospital, a rental insurance policy can ensure that you do not pay out-of-pocket if these items are damaged.
- Water damage. Once the fire has been extinguished, administrators may be forced to pay for the effects of flooding due to firefighting efforts. Check your policy to ensure that internal flooding costs will be paid for, or determine whether water damage from firefighting is covered under cleanup costs.
- Inland marine insurance. A fire that occurs offsite can still damage your property if it is on the move. Also called transportation and cargo insurance, inland marine insurance covers pay any goods or property damaged in transit to another location.
- Business interruption insurance. Business interruption insurance is vital for any commercial enterprise, as it replaces lost income while policyholders perform repairs. Business income coverage can help you retain employees and staff members, cover the costs of canceled procedures, and help retain patients until you are able to reopen.
If you need help getting payment for your losses after a fire, the Voss Law Firm can work to get you full and fair compensation to make repairs and reopen your doors. Simply fill out the form on this page today to get answers to your questions from our commercial insurance claim attorneys.