Friday, September 25, 2015 Des Moines, IA. 12:45 1:45 p.m. OLDER BUILDING SYNDROME: IT DOESN T GET BETTER WITH AGE

Transcription

1 Friday, September 25, 2015 Des Moines, IA 12:45 1:45 p.m. OLDER BUILDING SYNDROME: IT DOESN T GET BETTER WITH AGE Presented by Carl Morello AVP Safety and Health Zenith Insurance Company Thorough loss control is critical to minimizing risks for farm and agribusiness operations that are faced with the reality of an aging infrastructure older buildings and unique wear and tear exposures. This session will discuss the importance of risk control. It will then look at some of the more common issues relating to roofing, plumbing, HVAC, and electrical. It will also review actions that can be taken to minimize such risks and consequently ensure proper insurance coverage for the most costeffective premium. Copyright 2015 International Risk Management Institute, Inc. 1

2 Notes This file is set up for duplexed printing. Therefore, there are pages that are intentionally left blank. If you print this file, we suggest that you set your printer to duplex. 2

3 Carl Morello AVP Safety and Health Zenith Insurance Company Carl Morello is AVP of safety and health with Zenith Insurance company. Prior to joining Zenith, he was vice president of loss control with Sequoia Insurance and was in loss control and a home office business manager with The Hartford. He received a B.S. in civil engineering from Roger Williams University and an M.S.M. M.B.A. in management from Albertus Magnus College. 3

4 Notes This file is set up for duplexed printing. Therefore, there are pages that are intentionally left blank. If you print this file, we suggest that you set your printer to duplex. 4

5 Building Updates and Aging Critical Systems: The Agent s Role as Adviser and Risk Manager Presented by Carl Morello, P.E., ARM, ALCM, AFIS Wines wines Fine arts fine arts Antique antique furnishings furnishings Improvement with Age What doesn t? What Doesn t? Most buildings most buildings do not do not 2 5

6 Why Buildings? 1. Electrical 2. Plumbing 3. Heating, ventilation, and air-conditioning (HVAC) 4. Roofing Critical systems 3 Building Age 4 6

7 Building Age Effect of age on the critical building systems Plumbing HVAC Roofing Electrical 5 What is a building update? Critical building systems Electrical Plumbing HVAC Roofing Building Updates 6 7

8 Electrical Issue is age The common misunderstanding Replace wiring Aluminum Solution Building Updates Inspection and validation Some company underwriters views on age Do they really get it? 7 Aging Electrical Wiring 8 8

9 Aging Electrical Wiring 9 Aluminum 10 9

10 Building Updates Ascertainable Causes of Fire Loss in Structures I. I. I. Insurance Fact Book % 8% 3% 8% 10% 1% 3% 8% 8% 6% 24% Children playing Smoking Heating Cooking Electrical Wiring Appliances Open flame/ember Other heat Other equipment Natural causes Exposure 11 Building Updates 12 10

11 Primary Causes of Electrical Losses Loose connections/parts 30.3% Moisture 17.4% Line disturbance (other than lightning) 10.4% Defective/inadequate insulation 9.9% Overloading/inadequate capacity 2.4% Accumulation of dust, dirt, and oil 2.2% Lightning 8.1% Foreign objects/short circuiting 7.3% Collision 3.9% All other causes 8.1% 72.6% 13 Inspection 14 11

12 Knob and Tube 15 Knob and Tube 16 12

13 Knob and Tube 17 Inspection and Validation 18 13

14 Inspection and Validation 19 Inspection and Validation 20 14

15 Inspection and Validation 21 Inspection and Validation 22 15

16 Inspection and Validation 23 Inspection and Validation 24 16

17 Inspection and Validation 25 Inspection and Validation 26 17

18 Inspection and Validation 27 Inspection and Validation 28 18

19 Inspection and Validation 29 Inspection and Validation 30 19

20 Infrared Thermographic Imaging Detects hot spots Dirty, loose, oxidized, or corroded connections Finds phase imbalance problems Finds undersized wiring problems 31 Background Infrared Thermography All objects emit thermal radiation (heat). Technique for making energy visible is called infrared thermography. Thermal image captured by the thermographic camera allows for meaningful interpretation. Data it contains are digitally stored and computer processed for further analysis

21 Infrared Thermography An infrared inspection program can provide users with a quick return on investment. From our infrared inspection experience One item may pay for the inspection several times over. On average, for every $1 spent is a $4 return. 33 Infrared Thermography The benefits of planned maintenance schedules Helps to prevent unscheduled shutdowns Provides improvements in production efficiency Reduces energy bills Maximizes equipment availability Allows repairs to be made at a convenient time Provides confidence in plant equipment Monitors high-risk production processes 34 21

22 Infrared Thermography Proactive risk management You control shutdown Non-contact temperature measurement technique Requires no interruption of production you don t have to sacrifice productivity to gain productivity Safe monitoring distance Detects potential faults 35 Electrical assessment Infrared Thermography 36 22

23 Electrical assessment Infrared Thermography 37 Infrared Thermography 38 23

24 Infrared Thermography 39 Infrared Thermography 40 24

25 Infrared Thermography 41 Infrared Thermography 42 25

26 What Do Underwriters Look for? If the property is more than 30 years old, expect the insurance underwriter to ask: What type of wiring is present in each part of the building? When was the wiring installed? What is its condition? Does any part of the building have aluminum wiring, BX ( armored ) wiring, or knob and tube wiring? Has the wiring been updated in any part of the building? When was this done? What updates were made (full or partial)? Was the update done by a licensed electrical contractor? Is the system protected by circuit breakers or by fuses? Have there been any problems or failures of the electrical system? If so, describe the problem and how it was addressed. How is maintenance of the electrical system handled? 43 A resourceful and helpful agent will Role of the Agent understand the risks associated with older buildings; educate policyholders about the hazards associated with older buildings and the reasons why underwriters request information about older properties; collaborate with policyholders and underwriters to gather pertinent information and identify areas of concern; communicate the condition, suitability, safety, and reliability of the policyholder s building systems to the underwriter; counsel and assist policyholders in making smart risk management decisions about their properties, including making necessary upgrades and obtaining appropriate insurance; and follow up to ensure that agreed-upon upgrades are completed and that maintenance programs are in place

27 Aging Plumbing Systems What Do Underwriters Look for? If the property is more than 30 years old, expect the insurance underwriter to ask: What type of water supply piping is present in each part of the building (copper, galvanized, polybutylene, other)? When was this installed? What is its condition? Has the piping been updated in any part of the building? When was this done? Describe what updates were made (full or partial). Have there been any problems or failures of the plumbing system? If so, describe the problem and how it was addressed. If the property has laundry facilities, when were the laundry hoses last replaced? What types of hoses are in use? When was the water heater installed? What is its condition? Has it been installed and vented (if appropriate) according to the manufacturer s specifications? Is it properly braced to protect against seismic activity? What type of fuel is used in the water heater (natural gas, electric, oil, other)? How is maintenance of the water heater handled? Are the drain and waste piping made from cast iron, vitrified clay, or other material? How is maintenance of the plumbing system handled? 46 27

28 Age Issue 47 Distinctive Look of Polybutylene Piping Photo courtesy InterNACHI. Used with permission. Polybutylene Piping Photo courtesy InterNACHI. Used with permission

29 Corrosion on Galvanized Steel Piping Photo courtesy Levco Builders. Used with permission Corrosion from a Pinhole Leak in Galvanized Steel Piping Photo courtesy Levco Builders. Used with permission

30 51 Reducing the Risk of Water Heater Failures 52 30

31 Water Heaters 53 Water Heaters 54 31

32 Every water heater will fail Lifespan 5 10 years Emerging Issue 55 Every Water Heater Will Fail Slow leak or catastrophic failure Uncontrolled water flow Resultant damage Water damage Mold Decay 56 32

33 Lifespan Institute for Business and Home Safety study Failure rises steeply after 5 years 75% failed before 12 years Average age was 10.7 years Manufacturer warranties years Lifetime 57 Pay Me Now or Pay Me Later It is more cost-efficient to replace heaters before they fail than to deal with the costs and aftermath of water damage. Plan to replace the heater before it shows signs of weakness or failure, usually before it is 10 years old

34 Pay Me Now or Pay Me Later 59 Habitational Water: washer hoses Rubber hoses Braided stainless steel Heavy duty reinforced Location?? A claim that we want to prevent 60 34

35

36 HVAC Systems HVAC Systems Underwriting questions When was the heating system or furnace installed? What is its condition? Has it been installed and vented (if appropriate) according to the manufacturer s specifications? Has the heating system been updated in any part of the building? When was this done? Describe what updates were made (full or partial). Have there been any problems or failures of the heating system? If so, describe the problem and how it was addressed. How is maintenance of the heating system handled? When was the boiler installed? What is its condition? Has it been installed and vented (if appropriate) according to the manufacturer s specifications? Has the air-conditioning system been updated in any part of the building? When was this done? Describe what updates were made (full or partial). Have there been any problems or failures of the air-conditioning system? If so, describe the problem and how it was addressed. How is maintenance of the air-conditioning system handled? 64 36

37 HVAC Systems Typically require updating only on as as-needed basis A building s heating system furnace, boiler, or heat pump can last for many years with proper maintenance. Heating equipment generates relatively few claims. The primary loss driver in the HVAC equation is the air-conditioning system. Roof-top units are used to cool nearly half of all commercial floor space in the United States Need special care and maintenance to guard against damage caused by dust, debris, and hail 65 HVAC Systems 66 37

38 HVAC Systems 67 HVAC Systems 68 38

39 Roofing Systems 69 Roofing Easy as managing the warranty? 70 39

40 Roofing More complex than meets the eye Variety of materials Exposure to varying elements Warranty under normal conditions 71 Roofing An underwriter will ask when roof is over 20 years old: What type of roofing system is used in each part of the building (tile, slate, wood shake, metal panel, built-up, asphalt, other)? Does the roof include failure-prone fiber-cement shakes or shingles (see below)? When was the roofing system installed? What is its condition? Has the roof been updated in any part of the building? When was this done? Describe what updates were made (full or partial). Have there been any problems or failures of the roofing system? If so, describe the problem and how it was addressed. How is maintenance of the roofing system handled? 72 40

41 Roof Age 73 Roofing Inspect annually once signs of age or damage appear Damage causes: Aging Weather Sunlight Moisture 74 41

42 Roofing Damage (continued) Ponding Ice dams Debris Physical damage Nearby trees 75 Agent s Role Encourage proactive upgrades to critical building systems Long-term investments Protect and increase building value Helping client to understand the Age of Building questions Assisting with gathering and communicating accurate information to the underwriter Agent fosters a mutually beneficial relationship between the insurer and the policyholder. By serving as an informed adviser and advocate, the agent can help the policyholder to reduce risk, increase safety, and save money over the long term

43 Questions March 25, 2013 February 25, 2013 April 22,