Frozen and burst pipes cost businesses millions every winter. According to the Insurance Institute for Business and Home Safety, 25% of businesses do not survive after a major property disaster, such as a freeze-related water incident. Philadelphia Insurance studied 433 business claims for burst pipes to offer prevention advice for businesses and risk managers. They noted that, “Our average loss related to frozen pipes is $27,000, but our most expensive claim was $1.7 million.”
Among their findings:
- Unheated attics were the most common cause of burst pipes. Many people forget there are pipes in the attic or in concealed spaces between interior and exterior walls and therefore don’t take steps to protect them.
- Sprinkler systems increase loss potential. Philadelphia’s claims were split 51/49 between sprinkler and domestic water pipe losses, and sprinkler claims were 33% more costly.
- Building age is a contributing factor to loss. Claims from older buildings tend to be more severe because they often require code updates during any cleanup and repair process.
- Complications during cleanup can drive up costs. Some environments require specialized remediation. In other cases, clean up might turn up underlying problem that needs addressing, such as asbestos.
Philadelphia recommends a Heat Examine Alleviate Technology approach, or a HEAT system. They offer a HEAT checklist, or watch this short video to prepare for and prevent pipe freeze, breakage and subsequent water damage. They also offer a handy Winter Weather Property Protection tip sheet with more great prevention tips for businesses. And see their recommendations for freeze prevention and control devices.