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Printers melted by heat of steam
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At 3:00 AM on 11/06/03, our branch manager received a call that our Texas laboratory was on fire. Upon arriving at the facility, he found the fire department had brought the fire under control. They had also taken extra efforts to cover key equipment to limit water damage. At daybreak the insurance adjustor arrived along with fire investigators and salvage people. Everyone seemed helpful and the situation appeared under control. The investigators determined the cause to be a short in the building’s electrical system of unknown cause. The fire had burned through the roof, making our office uninhabitable. We had to move everything out as soon as possible. While the fire department was successful in confining the flames to one small area, smoke and steam bathed every piece of equipment and every file.
The loss and disruption were unimaginable. At least we had the good judgment to have adequate fire insurance in force, so we thought. We had worked with our insurance agent to determine the amount of insurance coverage we should have. They recommended that we inventory all equipment and determine its replacement cost. Our fire coverage should be equal to this replacement cost. We had purchased and maintained fire insurance in this amount.
A few days after the fire, we happened to ask who was paying for the salvage company that had been recommended by the insurance company and was being so helpful moving our equipment to their facilities for cleaning and repair. Only then did we learn that the cost for these services would come from the fire insurance coverage. By this point, the salvage company had all our equipment and all our records. They presented us with an estimate for their services that equaled about half of our coverage. Since most of our equipment was seriously damaged from smoke and steam, our losses would equal our coverage, but the salvage costs would take half of this. We faced receiving only 50% of the value of our equipment after paying the costs for the salvage operation.
This experience has been an expensive lesson for us. Laboratories contain lots of equipment and records that can be rendered useless by smoke and steam. From our experience salvage companies charge a lot to remove this equipment, chemically treat it to stop corrosion, and clean it only to then determine that it will not work. When purchasing fire insurance we strongly recommend that you add the costs of salvage to the value of your equipment to have adequate coverage for all costs. These costs can be very significant and difficult to control.
W. Allen Marr
Geotesting Express, Inc.
