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Frequency of House Fires Compromising Insurance Cover

02/06/2024

During the past week, MPS Farms lost two houses in their Feather Crest complex in Brazos County, TX. in addition to one house on a Daybreak Foods complex in Palo Alto County, IA.  These losses add to the ever-growing litany of fires mostly associated with electrical malfunction.

 

According to Brett Cohrs, Senior Vice president of Palomar Insurance, rates are rising rapidly.  This is due in part to the recognition that chicken houses are associated with a high risk of fire.  In addition, the replacement cost of houses is advancing faster than inflation.  Individual houses are now larger with capacities for multilevel aviary units in excess of 200,000 hens.  Causes of fires include:

 

  • Under-code wiring in many older houses
  • Construction using timber and other flammable materials.
  • Improper maintenance of electrical equipment
  • Defective alarm systems
  • Lack of contingency plans in the event of a fire including an available supply of water
  • Improper storage of manure that can result in spontaneous combustion.
  • Building multi-level high-capacity houses on the foundations of older high-rise units resulting in close proximity of buildings. This creates a greater risk of inter-house spread of fire on a complex.

 

In response to the increased incidence of fires with serious financial losses, Prism Controls has developed the ThERM fire detection and suppression system.  In the event of a fire, sensors detect the presence of smoke particles and an increase in temperature. The main electrical panel and all fans are inactivated to suppress extension of fire from the source. Alarms are automatically sent to designated managers and first responders.

 

It is evident that apart from increasing premiums and higher deductibles, it may be difficult or even impossible to obtain fire insurance for companies with a history of loss or for specific types of houses. Replacement of a conventional cage house will be $30 per hen and for a multilevel aviary unit capital cost may be upwards of $45 per hen