Home Office statistics show that between April 2019 and March 2020 the number of warehouses destroyed by fire in England increased by 42%.

The warehouse sector is growing exponentially – one developer alone is currently building more than one million square metres of warehousing in the UK to meet demand. This demand is being fuelled by e-commerce which requires large warehouses (often 10,000m2 +). It is important to note that these new warehouses often require large numbers of staff often working in complex racking systems.

Equally, modern factories often now have warehouses attached to the factory to facilitate just-in-time manufacturing processes.

Fires in warehouses and factories often result in complete destruction: by the time the Fire and Rescue Service (FRS) has arrived, the fire is developed and not possible to contain. The FRS task is then to ensure all occupants are safe and that the fire does not spread to neighbouring buildings.

The increasing size of these buildings mean that losses are also growing exponentially. Financially, fire and explosion insurance claims arising from ICBs[1] in the UK during 2018 totalled £940 million. These figures represent the claims incurred by the Association of British Insurers (ABI) members in that year but do not include the business interruption impacts of those claims. Similarly, this does not reflect the amount of self-insurance taken by business, government schemes or other insurers who are not members of the ABI operating in the UK. The full claims figure is therefore most definitely greater than £1 billion.

BSA view:

The cost of warehouse and factory building fires is high and increasing. Moreover, the threat to life in these buildings is growing. The regulatory solution is to use the Building Safety Bill to make property protection a consideration of the Fire Safety Building Regulations. As sprinklers control/extinguish fires at source, they would be installed in many more warehouses and factories as a result – thereby enhancing the safety of employees and also significantly reducing the cost of fire. A study undertaken by BRE in 2013 concluded that it is cost beneficial to install sprinklers in these buildings when they are larger than 2,000m².

[1] Association British Insurers - https://www.abi.org.uk/news/speeches/2019/speech-by-james-dalton-at-the-abi-property-insurance-conference/