Flood loss lesson

AFM engineer finds cause of loss; insured quickly implements advice to avoid this hazard in the future

Rain pummels Southwest Illinois, USA, for two hours. The deluge overtaxes culverts and storm drains surrounding a nursing home and three inches of murky, debris-filled flood water gush inside. The storm causes well over US$1 million in property damage to the nursing home and disrupts the lives of its 86 valued residents.

This is an actual loss that happened to an AFM client. The nursing home is not located in a high-risk flood zone. It is not even in a moderate-risk flood zone. Why did this happen and what can we learn from this loss?

Our engineer who visited the facility found debris and silt built up in the nursing home's drainage system. Improper maintenance and cleaning caused this hazard. This is a very common and avoidable scenario.

Take AFM's practical advice
After consulting with our broker partner and client, AFM and the insured took these steps:

  • AFM provided a Loss Report to help the client understand the exact cause of the loss and to empower them to prevent future flood losses of this nature.
  • Our client quickly implemented the advice to work with the local municipality to repair and clean the drainage system.
  • Our client also implemented a schedule of regular inspections of the ditches and culverts surrounding their facility to ensure the drainage system will perform as it is designed to.

What if there were a way to learn from a loss without the pain of experiencing it firsthand? That's the goal of FM Global's Loss Alerts newsletter. Each month, this electronic newsletter features brief case studies of recent property losses along with related resources to help our clients understand the hazards and then take action.

Here are three case studies featured in recent editions:

  • A domestic water leak at a medical office building resulting in a US$7 million loss
  • A targeted cyberattack against a hotel, which took five months to fully recover from
  • A hailstorm that caused US$2 million in damage to the roof of an office complex

Receive real loss lessons each month
Each newsletter also includes a link to the Loss Alerts archive, where past articles and resources are grouped by peril. To view a sample edition of Loss Alerts, click here.

While our main goal is to help our clients prevent losses from happening in the first place, inevitably, some losses do occur despite our best efforts. And when they do, we see them as learning opportunities. If you would like us to share these loss lessons with you, subscribe to our Loss Alerts newsletter.