who else owns this loss course

Who else owns this loss?How to Pursue or Defend Subrogation Claims for Property

Damage Losses

Presented By: Jeffery H. Warren Ph.D., P.E., CSP

Mannequin Reenactment

Safetythroughdesign®

Case Study W6105

Analysis of No. 6 Fuel Oil Tank Explosion and Fire

Aristotle said in 350 BC

Accidents are

without cause.

Injury or Fatality

Incident

Cause

• “The fire occurred when a spark or molten globule fell into the area from the welding operation being conducted on the precipitator above the tank.”

• “The subsequent explosion was the vapors igniting and flashing back inside the vapor filled head space of the tank.”

Conclusion

• “It is apparent that safeguards to prevent the shower of sparks and molten globules of metal from reaching the flammable vapors in the area around the No. 6 fuel oil day tank were not adequate.”

The Insurance Company of the Welder

Now

In another city on another day

Most Property Damage Losses:

• are predictable• are preventable

• All have A CAUSE!• Most have MULTIPLE CAUSES!

Be Sure To Look at ALL theSwitches!

NFPA 921

Guide for Fire and Explosion Investigation 2011 Edition

NFPA 921 Significant features of a Fire or Explosion

• Cause of • The fire or explosion• Damage to property resulting from the incident• Bodily injury or loss of life• Degree to which human fault contributed to any one or more of the causal

issues

Cause No. 1

• Fire or explosion

T

Fire Tetrahedron

HeatFuel

Oxidizing Agent

Uninhibited chemical

chain reactions

Cause No. 2

• Damage to Property resulting from the incident

Cause No. 3

• Of Bodily Injury or Loss of Life

Cause No. 4

• Degree to which Human Fault contributed to Cause No. 1, No. 2 or No.3

Several Factors May Be Involved

• Fire starts when a blanket ignited by incandescent lamp in a closet• Factors

• Lamp hanging down too close to the shelf• Putting combustibles too close to the lamp• Leaving the lamp on while not using the closet

• Cause of fire or explosion?Ignition sourceFuel SourceCircumstances or human

actions that caused them to come together

• Cause of spread of fire?• Cause of explosion?• Is there a design defect?

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• No. 6 Fuel Oil• Material Safety Data Sheet Review• Hazards Identification Section

• OSHA/NFPA Combustible liquid; however flammable vapors may accumulate in tank headspace.

• Flash Point: 150F• Autoignition:765F

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• Fire and Explosion Hazards (MSDS)– When heated to flash point and mixed with air and exposed

to an ignition source, flammable vapors can burn in the open or explode in confined spaces.

– Flammable vapor production at ambient temperatures in the open is anticipated to be minimal unless oil is heated above it’s flashpoint.

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• Fire and Explosion Hazards (MSDS)• Light hydrocarbons can buildup in the headspace

of tanks below the flashpoint of the oil, presenting a flammability or explosion hazard.

• Tank headspaces should be regarded as potentially flammable, since the fuel’s flashpoint cannot be regarded as a reliable indicator of the potential flammability in tank headspaces.

Case Study W6105 Analysis of No. 6 Fuel Oil Tank Explosion

• Standards Research• API Publication 2009 Safe Welding and Cutting Practices in

Refineries, Gas Plants, and Petrochemical Plants, Fifth Edition, August 1988

• 1.1 Scope– This publication provides guidelines for safe practices when

welding or cutting is performed in refineries, gas plants, or petroleum plants

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• API 2009 (cont’d)• 2.2 Work Location

– The work location must be gas free, and precautions should be taken to prevent ignition of flammable or combustible materials. Before welding or cutting is performed above or near oily surfaces, the area should be flushed with water, steam cleaned, or covered with clean dirt or sand, or other precautions should be taken

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• API 2009 (cont’d)

• 3.1 Permit RequirementsExcept in areas specifically designated as safe, such as welding

shops, a permit should be obtained before starting any work that can involve a source of ignition.

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• API 2009 (cont’d)

• Section 4-Testing for Flammable VaporsA competent person using an appropriate combustible-gas

indicator should perform tests for flammable vapor concentrations before hot work is started.

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• API 2009 (cont’d)

• 5.4 Work on Outside Surfaces… Hot work should not be performed on one vessel or piece of

equipment in a plant unit while other parts of the same unit are in operation unless precautions have been taken to prevent the release of flammable liquids and vapors into the area.

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion• API 2009 (cont’d)

• 2.4 Flammable Liquid and Vapor… Operators should notify workers engaged in hot work of

actual or imminent releases of flammables or other combustibles, such as those from relief valves,so that hot work can be stopped immediately.

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

Case Study W6105Analysis of No. 6 Fuel Oil Tank Explosion

• The Hot Work Permit Asks:

4. There are no combustible fibers, dusts, vapors, gases or liquids in the area. Tanks and equipment previously containing such materials have been purged. The absence of such vapors has been verified by a combustible gas detection instrument.

INVOLVEMENT Matrix

Involvement or problem Tenant Owner

Property Manager

Sprinkler Maintenance

Fire Origin and CauseSprinkler didn't workNot enough water

Primary Action - Party involved caused the problem

Secondary Action - Party involved knew or should have known about the problem and taken action to resolve the problem

Involved Parties

INVOLVEMENT Matrix

• http://warrenforensics.com.s158756.gridserver.com/wp-content/uploads/2013/01/Investigation-Saves-Money-on-Tank-Explosion-Claim2.pdf

• Which switch caused the loss?• Who is responsible for the loss?• Is there a subrogation case?

•You analyze the loss with your group•Answer the questions•Create a Responsibility Matrix•We’ll discuss•You have 15 minutes

Be Sure To Look at ALL theSwitches!

Moat was not tested to check for the presence of explosive gas mixtures

Plant Welding Contractor

Moat contained No. 6 fuel oil and wood chips, both of which are flammable

No. 6 fuel oil vapors vented from day tank into surrounding moat

A hot work permit was issued without all of the proper safeguarding measures being performed

Safeguarding inadequate to prevent sparks and molten metal from reaching flammable vapors

A hot work permit was issued while an adjacent tank was being ventilated

Welders were not notified of the release of flammable vapors by the plant

NFPA 921Analysis of Electric Motor Failing to run on High Speed

Specs

The horsepower ratings are for guidance and do not limit the equipment size. When electrically driven equipment furnished under other sections of these Specifications differs from the contemplated design, the Contractor shall be responsible for the necessary adjustments to the wiring, disconnect devices and branch circuit protection to accommodate the equipment installed.”

•You analyze the loss with your group•Answer the questions•Create a Responsibility Matrix•We’ll discuss•You have 15 minutes

Blower motor hp & speeds revised in specs but not in drawings before contract

Motor control center change order issued with no accompanying revision to drawings

Specs written as to encourage unauthorized design modifications of drawings

NIC Electric notified contractor of wire changes. No revisions to drawings received

Blower motors installed do not match the drawings nor specifications

No. & size of conduit & wire in drawings were inadequate for blower motors installed

Electrical subcontractor decided to attempt to redesign the wire & conduit himself

Submittals were not prepared prior to performance of the work

Wire & conduit not called for in the drawings was installed

Engineer General Contractor

Electrical Subcontractor

CASE STUDY W4170

Analysis of Fire in Carpet Padding Facility

Safetythroughdesign®

Stop

Is risktolerable?

Assess risk

Other hazards?

Can hazardbe eliminated?

Can hazardbe guarded?

Provide warnings,

procedures, and training

Operatethe machine

More tasks?

Is risktolerable?

Is there a hazard?

Identifytask

Yes

No

No

Yes

Yes

No

NoYes

Yes

No

Yes

No

Yes

No

Risk Assessment Decision Matrix

Probability of occurrence Catastrophic Critical Marginal NegligibleFrequentProbableOccasionalRemoteImprobable

Severity of Consequence

The Safety Hierarchy

is stable

Eliminate the hazard

Safeguard the Hazard

Warn about

the Hazard

Proceduresand

training

Upside Downis Unstable

Eliminate the hazard

Safeguard the Hazard

Warn about the Hazard

Procedures and training

Cause classifications

• Incendiary• Natural• Accidental• Undetermined

Incendiary Fire Cause

• Cause is a deliberate human action in which the person knows the fire should not be set

Natural Fire Cause

• Cause is without deliberate human intervention– Lightning– Earthquake– Wind

Accidental Fire Cause

• Cause is not a deliberate human act to ignite or spread the fire into an area where the fire should not be.

Undetermined Fire Cause

• Whenever the cause can not be determined

•You analyze the loss with your group•Answer the questions•Create a Responsibility Matrix•We’ll discuss•You have 15 minutes

Origin in Filter House

Sprinkler didn’t work

Sprinkler not inspected

Valves not locked open

Filter not cleaned

Filter in building

Not enough water

Supply pond drained

Isolation valves closed

Tenant #1 Owner Property Manager

Sprinkler Maintenance

Subrogation

• Theories of Liability• Products Liability Case

Theories of Liability

• Strict Liability• Negligence• Warranty

To Have a Products Liability Case

• Plaintiff must prove the following:• The product was defective when used• The defect existed in the product when it was manufactured• The defect was the proximate cause of the injury to the

plaintiff• The specific use of the product that caused the damage was

reasonably foreseeable

Types of Defects

• Design defect• Manufacturing defect• Marketing defect

Fire Hydrant Case

In Summary

During this session you heard :

• Cause first• Responsibility second• An Involvement Matrix may be helpful • Engineers can help you

Involvement Matrix

  Involved Parties  

Involvement or problem Tenant OwnerProperty Manager

Sprinkler Maintenance  

Fire Origin and Cause          

Sprinkler didn't work          

Not enough water          

    Primary Action - Party involved caused the problem

Secondary Action - Party involved knew or should have known about the problem and taken action to resolve the problem

Most Property Damage Losses:

• are predictable• are preventable• All have A CAUSE!• Most have MULTIPLE CAUSES!

Be Sure To Look at ALL theSwitches!

Who has the first question?