Good fire investigators will do their best to determine the cause and origin (C&O) of a claim. However, there has been a disturbing increase in the number of fires where the investigator is listing the cause as “undetermined.” This means that insurance companies may be missing out on opportunities to pursue subrogation against third parties whose product or services may have been faulty.

GE Insurance Solutions has noted this worrying trend as a result of reviews and audits it has conducted for ceding company customers — in order to help them investigate and handle property claims. Ceding companies are spending thousands of dollars on C&O investigations only to find that the investigator has listed “cause undetermined” on the back page of the report. The typical expense for fire investigation costs between $750 to $3,500, and in some instances even higher. As a result, a verdict of “cause undetermined” should only be used when all possible avenues have been exhausted.

There are several reasons for this trend. One is that the finding of “undetermined” is the easiest verdict for an untrained fire investigator. The competency level of some investigators is not up to the highest standards — partly due to the burgeoning ranks of part-time and inexperienced investigators. The number of people conducting investigations has grown exponentially since the 1980s — in large part due to the romantic image and the publicity such work has received. Further, the U.S. government's “war on arson” spawned a cottage industry that includes C&O experts, mega-subrogation law firms, and forensic laboratories.