What is the Cost of Fire Damage to a Business?

Posted On: September 8th, 2021

When most people talk about a fire in a business, your thoughts will normally turn to the material cost of the damage. Here’s the bad news, the cost of fire damage to a business is so much more than that. Several things could be lost, all of which are incredibly expensive (and sometimes irreplaceable). We are talking about production, time, and ultimately people’s lives.

The good news is that by reducing the risks of fire, you can protect yourself. Today we will address some common businesses affected by fire, give you an idea of how much fire costs business each year, and offer some great solutions on how to prevent fires in the workplace.


How Much Does Fire Damage Cost a Business?

The true answer is that fire can cost varying amounts in a business. However, any cost due to fire should be considered unacceptable. Aside from the damage actually caused by a fire, there are other things that need to be considered too when assessing the cost of fire:

  • Lost Operating Time

Even if a fire is relatively small, your business could find it costly. Every day spent making repairs or making good damage could be a disruption to the normal ‘flow’ of your day-to-day business. Depending on the industry, this could be costly.

  • Insurance Problems

It may not be just your business that is affected by a fire. If that fire happened to start as a result of your actions (or lack of), you might very well find that insurers find you liable, leading to massive costs.

  • Public Confidence

Any business that is visible in the public eye needs to carry consumer confidence. A fire outbreak is neither reassuring nor a good look for any potential business. Once your customers have gone, they may never come back. All of a sudden, that fire is even more costly!

  • Loss of Life

This is highly serious. Fires can be fatal when you consider that, according to the NPFA, in a five-year period, there were 3340 office fires, the risks, and therefore the costs are substantial.

If all of the above isn’t reason enough, let’s talk monetary value. The National Fire Protection Association estimates that as an average between 2015 and 2019, the Mercantile and Business sectors alone lost over seven billion dollars due to fire. This doesn’t include figures in other areas that could be classed as ‘business’ such as storage, manufacturing, and industry.

Those are some pretty big numbers.


Which Businesses Suffer the Most Fires?

All businesses suffered from fires. In terms of expenditure, the NFPA gives details of the following types of businesses that incurred significant financial losses:

  • Assembly and Production
  • Educational Institutions
  • Merchants
  • Industry
  • Agriculture
  • Manufacturing
  • Storage
  • And many more

The above list isn’t exhaustive. The truth is that no business is immune from fire. Even if the risk was 1 in 1000, there is a chance that a business could just be ‘unlucky’. It is a far better metric to look at the causes of fires. Most businesses will have one or all of the following, all of which are reported by the NFPA as causing fires in business:

  • Cooking equipment 29%
  • Electrical distribution and lighting 12%
  • Heating equipment 11%
  • Smoking 9%
  • Office equipment 3%

Does your business have any of the above? If so, ask yourself, what is stopping your business from being included in the above number?


How to Reduce Fire Risk in your Business

There is some good news. Provided you think about the risks and costs of a fire in your business in advance, you can prevent it. Here are some great ways to reduce your risk and liability.

  • Proper Training

If a fire is discovered, do people in your business know what to do? A fire in a business can affect everybody; therefore, it is everyone’s responsibility to deal with the hazard. More people being aware means reduced risk.

Suppose you aren’t sure where to start. In that case, it is well worth contacting a professional fire protection service who’ll be able to offer advice.

  • Regular Maintenance

When was the last time you had your fire protection systems checked? Are they still working? Not sure? If you can’t answer any of the above, it is high time to check your fire protection systems. Many businesses will have inherited the old system, with no data on when it was installed or checked.

It could even be time for an upgrade.

  • Passive Fire Protection

Passive fire protection ensures that fires are contained. By keeping fires localized and small, you can reduce the cost to your business.

  • Risk Management

As you’ll have seen in the list above, nearly all businesses contain fire risks. How risky is the equipment in your building? A cost-effective way to protect your business is to speak to a fire safety consultant who can perform an inspection and best advise you on the steps you need to take to minimize your risk.

  • Effective Equipment and Safety Systems

Maybe your business has grown? Perhaps there is more footfall, staff, or area. Growth in business means that you need to reassess your fire protection equipment and safety systems. In businesses spread over large sites, this is particularly important.

Fraker Fire can offer state-of-the-art, new technology to protect your business against fire, regardless of size.

  • Seeking Professional Advice

There is a golden rule when it comes to fire protection for your business or even your home. If there is doubt, then there is no doubt. If you are unsure, the safest and easiest course of action for fire protection is to speak to a company that can offer expert advice.

Fraker fire can give guidance on everything from fire suppression systems to alarms, fire escape plans, emergency lighting, and more.



What is the cost of fire damage to business? Substantial. It is far cheaper to address the problem directly before an incident. Fraker Fire is ready to assist you in all aspects of fire prevention and planning. Contact us today.

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