Clear Fire Divisions Increase Insurability

September 19, 2019

Nearly all egg producers over a certain size have had to move to a layered property program. This means that multiple carriers join forces to build up the limits needed to adequately protect against a single loss event.

One major factor that plays into the rating of insurance by the carriers that insure risks above a primary property limit of $5,000,000 or $10,000,000 is the estimate of a probable maximum or foreseeable loss (PML). The higher the PML, the higher premiums climb further into upper layers of your property insurance.

With newer cage-free and larger conventional caged layer buildings’ values tipping the scales at $20,000,000 or higher, insurers who attach to a property program excess of $10,000,000 are concerned that they will be affected by a single barn fire. In the past, most carriers were shielded unless a fire or windstorm spread damage throughout a complex.

It is for this reason that Palomar encourages increased distance between buildings, firewalls in egg corridors, and firewalls and doors between dry storage and the processing areas of processing facilities.

Firewalls in Egg Corridors

When  planning construction of new layer barns, please remember to include cinderblock firewalls in the egg corridors between barns and between barns and processing or packing facilities. If no firewalls are present, retrofit firewall assemblies, i.e. two layers of fire rated sheet rock on each side of the wall. Also add a fire-rated door in the corridor.

Firewalls between Dry Storage and Processing/Egg Cooler Areas

Firewalls should also be included between dry storage areas and the processing and cooler rooms in a processing plant. If there is no firewall present, the recommendation is to add 2 hour fire rated assemblies.

To sum it up, when planning construction, make every effort to include fire stops, including firewalls and automatically closing fire doors, into plans to limit an accidental fire to a clearly defined section of property. Also, consider plans to systematically retrofit fire breaks for existing facilities.

A Refresher on Distance between Buildings

A 260,000 bird, $15M layer barn is a huge exposure. But building them 100 to 125 feet apart is not nearly as concerning as placing these large buildings only 40-60 feet apart.

While a 50 foot separation guideline is still in place, Palomar recommends 75 feet at a bare minimum, preferably 100 feet.  Simply put, insurers prefer as much distance as practical.

It requires more carriers to achieve the limits many egg producers need. Increasing separation distances, building firewalls, and using fire doors to help confine fires to specific areas should help attract more insurers and invite better terms over time.

In sum, the more a producer can demonstrate fire separation, the more attractive the risk to insurance carriers.


If you have questions about fire separation or the state of the current insurance market for agricultural and other property risks, please reach out to the Palomar UEP Team at or directly to any of our team members:

Brett Cohrs: 770-709-7712

Carolyn Grubaugh:  770-709-7713

Des Yawn: 770-709-7704

Evan Strother: 770-709-7715