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NOTE: This is an unformatted excerpt from our online fire protection training library.

Authorities and Requirements


Insurance Companies

Insurance companies have a vested interest in the application of fire safety, in that they may insure the people occupying the building, the property itself, or the business that takes place in a building. In some instances, the insurance company insures all three. In essence, they have an economic stake stake in the property.

There are many insurance companies in the land insuring properties and people. Insurance is a financial vehicle, one in which the insurance company receives a return on an exposure that they are willing to take when they “insure” a risk. An insurance company exposes their assets in “covering” the risk represented by a person or property. Thus, insurance can be viewed as an investment of funds that they collect from a group, a calculated gambleAn insurance company is betting that the people they insure will not have a loss. On the other hand, the insured party is betting that they will have a loss. So, there is the semblance of a "bet" placed. If the insured party is correct, they win the bet - but do they really? The insurance company pays the claim, but chances are the cash that the owner receives doesn't pay for things like lost customers, or loss of market share for a product lost in a fire. of sorts.

Many insurance companies are small and will not insure large properties, thereby limiting their exposure to financial losses. Often, a smaller insurance company will not have the staff or the technical ability to judge the protection criteria applied to a building. Consequently, they may rely on questionnaires filled out by the owner of the property, or they may use a service to collect information for them. One of these organizations is the Insurance Services Office (ISO), also known as the “rating bureau.”
NOTE: This is an unformatted excerpt from our online fire protection training library.

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