Electrical Fires: How Can Insurance Brokers Help Landlords Mitigate the Risks?
A 2011-2014 survey found that faulty electrical appliances caused over 10,000 fires during that three-year period. The top most at-risk appliances were washing machines (14%), tumble driers (12%) and dishwashers (11%).[i] Household fire hazards are particularly worrying for landlords, who have responsibility for the safety of their tenants as well as a financial investment in the property. The primary objective will be in lessening the risk of a fire starting. However, it is impossible to completely remove the risk and so it is vital to know what to do in the event of a fire as well as having a plan in place for property recovery. Insurance brokers are well placed to discuss the risk of electrical fires with their clients, advising them on how to reduce the risks and keep their tenants safe.
Reducing the risk of an electrical fire
There are a number of things that can be done to reduce the risk of an electrical fire.
This list is not exhaustive and it is important that your clients discuss any concerns with a qualified electrician.
What should happen in the event of a fire?
While the risk of fire breaking out can be managed with careful safety measures, it is sadly impossible to reduce the risk to zero. Having a fire safety plan is a necessity to ensure that tenants can escape quickly and easily in the case of a fire.
The fire safety plans outlined above are vital to ensure that all building inhabitants are able to get to safety quickly in the event of a fire. However, fire can still be devastating, with homes and property being damaged; sometimes beyond repair. At this point, the insurance company underwriting the damage will have a huge role to play. Swiftly organising temporary accommodation is extremely important to help tenants recover from the trauma of a fire. Claims should be responded to quickly and efficiently so the occupants can get back into their home as quickly as possible.
Every landlord will need to adhere to all up-to-date legislation regarding fire safety and electrical appliances. At a minimum, this will include regular tests of any appliances provided by them, safety checks on the general wiring of the house, providing working smoke detectors and other fire safety equipment where applicable, fitting fire doors and ensuring that there is an easy route out of the property in the case of an emergency. Given that there will be different regulations in place depending on property size and purpose, you will need to encourage your clients to stay informed on all the criteria that is relevant to them. Emphasise that not following their fire safety obligations may invalidate their insurance.
Insurance Broker Obligations
A fire can be devastating to both tenants and landlords, even when no injuries are sustained. Reliable buildings and contents insurance will be essential for easing the worries in the crucial days and weeks following a fire. Ensure that your clients are fully covered and are not underinsured. A too-low estimate of contents and property values can result in claims not being paid out in full.
Pushing the insurer to respond to claims quickly will have a huge impact on your client’s well-being and that of their tenants. Having staff available to communicate with clients in the aftermath of a fire (or other emergencies) will make a big difference to your clients. It is worth bearing in mind that statistically, 83% of customers dissatisfied with their claims experience will plan to switch their insurance provider[ii]. It can be surmised that these negative experiences will also be passed on to friends and family, greatly affecting an insurance broker’s reputation. Aston Charles is able to help you to recruit the best insurance staff; brokers with experience in the industry as well as the interpersonal skills to be able to communicate with people in the aftermath of a trauma such as a fire.
Brokers should support landlords in their efforts to reduce the risks of fires breaking out and encourage an excellent safety plan for the protection of any tenants. A broker’s main responsibility is the peace of mind that comes with a comprehensive insurance policy, with excellent customer services personnel, ready to react swiftly in the event of a fire.
[ii] Accenture, 2014. The Digital Insurer Claims Customer Survey. Accenture, page 5.