How Fire Protection Is Used In Determining Homeowner’s Insurance

By Richard A. McGrath, CIC, LIA

Each year, hundreds of thousands of fires take place in U.S. homes at a cost of billions of dollars a year.

Fire departments responded to 384,000 home fires in 2010, compared with fewer than 100,000 fires in all other structures, according to the National Fire Protection Association (NFPA).  Home fires resulted in $7.1 billion in damage, 13,800 injuries and 2,640 deaths, or about 85% of all fire-related deaths.

Cooking is the leading cause of home fires, but smoking is the leading cause of home fires resulting in death.  Clothes driers are another problem, causing an estimated 2,900 fires a year, resulting in $35 million in property damages.

Many of these fires, of course, can be easily avoided.  Staying by a stove at all times when it is on, not smoking in bed and regularly cleaning the lint catcher in your drier can help prevent fires.

Fire damage is covered by your homeowner’s insurance and your premiums are affected primarily by the type of construction you have and its location.  Fire protection, if it is even available, will be more expensive, of course, for a home built on top of a mountain in the woods that does not have easy access, compared with a home that is built right next to a fire station.

Your Fire District Rating

It’s not just access to your Fire Department that’s important, but how well prepared your local firefighters are to fight fires when they take place.

In the early 1900s, the National Board of Fire Underwriters evaluated the potential of fire and response times for many cities, resulting in improvements in fire safety.  This evolved into our current system, which divides the U.S. into more than 45,000 fire districts.

A public protection class (PPC) number ranging from one to 10 is assigned to each district, with one being the safest and 10 being an unsafe district where even minimum standards are not met.

Each district is rated based on three factors:

  • Communication, including the telephone system, staffing and dispatch.
  • The Fire Department, including its equipment, personnel, how well trained firefighters are and the geographic distribution of fire companies within the district.
  • The water supply system, including the availability of fire hydrants and the amount of water available.

To advance beyond a 10 rating, a district must achieve minimum standards, which require a permanently organized fire department, either paid or volunteer, with at least four firefighters serving a defined area.  In addition, firefighters much receive at least two hours of training every two months, the department must have a fire truck meeting standards set by the NFPA and the alarm system must function so that there is no delay in response time.

To achieve a class nine rating, additional equipment must be available, record keeping must be accurate and the department must have a tanker capable of delivering 50 gallons of water per minute at a pressure of 150 pounds per square inch.

A class eight rating can be achieved if the department can supply 250 gallons of water per minute for at least two hours.  The water must be available within five minutes after the first fire apparatus arrives at the scene of the fire.

There is also a special 8B classification for districts that have additional staffing and training, but are unable to meet the class 8 water requirement.  To achieve the rating, the Fire Department must be able to provide a minimum flow of 200 gallons of water per minute for 20 minutes within five minutes of arriving at a fire and the flow must be available to at least 85 percent of areas where buildings exist.

Minimum requirements do not exist for ratings one through seven.  Those ratings are based on points received for how well the department handles fire alarms, personnel and equipment available, training and water supply.

Most insurance agents and underwriters now have computerized rating systems available to help calculate home insurance premiums, based on fire district ratings.

What’s Your Home Made Of?

Materials used to build your home also have an impact on premiums.  Brick and other materials that are nonflammable will protect you from fire, resulting in lower premiums.

Most houses are “frame” houses, with wooden frames, and wood, aluminum or plastic siding.  Homes made of fire-resistant materials, such as bricks, concrete or stone, are classified as “masonry.”

Premiums are highest for “frame” homes and lowest for “masonry” homes, while in-between are classifications for masonry veneer and mixed construction (masonry and frame).  There is also a classification for “superior construction,” where the roof and floors, as well as the walls, are built with noncombustible materials, such as metal and masonry.

Building Codes

While a home’s degree of protection from fire has a significant impact on homeowner’s insurance premiums throughout the country, in some areas, building codes also have a significant influence.

Just as the Insurance Services Office (ISO) has created classifications of one through 10 for fire safety, it also has a new rating system for building codes.  The ratings have an impact on premiums in parts of the country that are especially susceptible to damage from wind, hail or earthquakes.

Building codes don’t have a major impact on premiums in Massachusetts, but that could change as the insurance industry and underwritings standards continue to evolve.

Richard A. McGrath, CIC, LIA is President and CEO of McGrath Insurance Group, Inc. of Sturbridge, Mass.  He can be reached at

This article is written for informational purposes only and should not be construed as providing legal advice.