But You Can Improve Your Underwriting Resume

While insurers tighten their underwriting guidelines around separation between buildings, the question begs: What do we do if we have barns, manure, and processing buildings less than 50 feet apart? If your buildings have separation issues, focus on strengthening these three areas:

1. Ignition Source Risk Management
2. Spread Prevention Measures
3. Emergency Pre-Planning

Even if your buildings are a minimum of 50 feet apart, it’s a good idea to double down on risk management right now. With the size of modern layer barns, 50 feet might not be sufficient. And anything that can be done collectively to strengthen the risk profile of the industry benefits everyone.

Ignition and Combustion Source Risk Management

The best way to prevent fire spread is to prevent fires period. If nothing combusts, nothing burns. Here are some tips from Global Risk Consultants to help improve your Ignition/Combustion Prevention Program:

1. Adhere to a Consistent Hot Works Program: Use a hot works permitting process for all work done in your facilities, every time. Few things are worse than the fire started the ‘one time’ the hot works protocols weren’t followed.
2. Schedule more Frequent Infrared Thermographic Scanning: It is required under the UEP insurance program to scan every year. Our program provides the service every other year. If your buildings are closer together, consider purchasing your own scanner and implementing twice yearly or quarterly scans of key equipment.
3. Enforce No Smoking Regulations: Having a “No Smoking” policy can protect the health of your employees and your birds. An errant butt tossed into an overgrown bit of weeds and grass near a pile of pallets during a dry summer could be devastating.
4. Create a Checklist for Housekeeping and Removal of Unnecessary Combustibles: Speaking of pallets and weeds, keep unnecessary combustibles away from your most precious assets and keep vegetation at minimal heights. Take a walk around your property and consider what is needed that could be stored more safely or sent to the landfill.
5. Implement Electrical Preventative Maintenance: Global Risk Consultants makes this suggestion, “Maintain good electrical preventative maintenance practices, such as eliminating use of over-loaded outlets, excessive extension cords, make-shift lighting or improper use of portable heaters.  The NEC (NFPA 70) can be used as a guide.”
6. Keep Your Flammables in a Safe Space: Use approved cans and cabinets and designated areas to help keep gasoline and other fire-loving liquids from causing major damage.
7. Practice Regular Conveyor Cleaning and Maintenance: Review and improve preventative maintenance measures related to motors, belt conditions, etc., to prevent ignition and spread of fire.  Regular inspections and maintenance schedules are key.
8. Manage Your Manure: Rotating manure in manure storage barns and cleaning manure out as often as possible can help reduce the likelihood of heat buildup and combustion.

If you can’t pick up your buildings and move them, the next best move is to make maintenance around potential combustion and ignition sources as air-tight as possible.

Taking care to implement and enforce programs around these housekeeping and combustion-preventing practices will not only improve your resume for underwriters but should, hopefully, have an overall positive effect on your operation as a whole.

For further reading on the helpful side benefits of safety and risk management see this interesting article from Charles Duhigg, the author of bestselling business book The Power of Habit about the potential for safety to transform a business: How ‘Keystone Habits’ Transformed a Corporation.

Palomar will address Spread Prevention and Emergency Pre-Planning in upcoming UEP Newsletters.

An important reminder…

Not to beat the same drum too loudly, but remember to review any new construction plans with your insurance agent or carrier. The underwriting landscape shifts often. Although 50 feet is the current standard, some insurers are considering 75 feet as the minimum, especially as layer barns increase in capacity and continue to be built mainly by utilizing frame construction.

Fifty feet begins to look awfully narrow when structures balloon in size – especially when those structures are built with wood-frame construction.

We realize that insurance is only one factor in these decisions, but unlike much that is unpredictable in the egg industry, it is clear that better rate consideration, insurability, and greater market options will be available to those who increase distance between buildings.

To discuss these and other insurance issues further, please reach out to the UEP Team at Palomar Insurance Corporation, the endorsed provider for the UEP for over 30 years. Des Yawn desy@palomarins.com or 770-709-7704. Carolyn Grubaugh caroling@palomarins.com or 770-709-7713. Brett Cohrs brettc@palomarins.com or 770-709-7712.