While there are general rules for any type of claims investigation, be it auto claims or homeowners or commercial loss, some types of loss require an adjuster to have special knowledge or expertise. Fire claims, especially those where arson may be a factor, are one type of these claims. This article looks at some of those nuances that an adjuster needs in researching fire claims. It's important to remember that fire is always a covered cause of loss; what is not covered in the intentional burning of property in order to file a claim and receive funds for profit; this is what makes the detection of arson key. If the insured intentional destroyed his own property, then the claim can be denied and the insured prosecuted.

Introduction

Detailed examination

Indicators of accelerants

Incendiary devices

Experts and others

Investigation research

Summary

Introduction

Between 2007 and 2011, roughly 282,600 intentional fires were set throughout the United States. These losses resulted in $1.3 billion in property damage, 420 deaths and 1,320 injuries per the National Fire Protection Association (NFPA). Two-thirds of intentionally set structure fires are set in buildings that are occupied and operating, fourteen percent are set in vacant, unsecured properties and eight percent in vacant, secured properties. Half of the home fires are set between 3 p.m. and midnight, and vehicle fires are often set late at night or early in the morning. Lighters and matches are the most common sources of heat, and rubbish, trash or waste are the most common items set on fire first. In homes the area of origin is most often the bedroom, in schools it is the bathroom, in storage properties it is the garage.

Detailed Examination

In order to determine the cause of the fire, and whether or not arson was a factor, a detailed examination is required. All utilities, appliances, and other heat producing items should be examined to see if they could have caused or contributed to the fire; burn patterns need to be noted. Certain supplies are needed in order to aid in the investigation; remember a fire has occurred, so it is messy and items may be hard if not impossible to identify. Some of these items are supplied by other vendors working on the site. Recommended tools are as follows:

·Two sets of sifting screens, starting at one inch mesh and going down to one-eighth inch mesh for discovery of finer objects

·A good camera, preferably 35 mm, either film or digital

·Video recorder

·Access to large equipment if large amounts of debris must be moved

·Lighting for the interior of the structure

·Tarp to place items on

·Evidence collection cans

In many cases the fire department will be present and reviewing what started the fire and collecting evidence. Instantaneous or onsite laboratory analysis is not practical, so the materials collected must be properly preserved until an analysis can be conducted. Clean, new metal paint cans that are easily sealed and resealed are best for debris that contains suspected volatile items. Because cans are non-permeable and available at low cost, they are often used by fire departments and fire cause-and-origin investigators. Glass jars with tight-fitting lids are an alternative, but are subject to breakage.

The investigators must take precautions to prevent evidentiary materials from escaping the container or becoming lost. It is also very important to avoid contamination of the specimens. Each item collected should, therefore, be packed in separate containers of appropriate size with all openings secured by appropriate means, such as tape or staples and labeled at the scene describing the contents.

Trace evidence, like soil specimens or paint chips, should be placed in folded paper bundles that can then be wrapped with tape and sealed or placed in a small cardboard box or envelope on which all seams and other openings have been sealed with tape. These precautions are especially important for multiple items of evidence.

The heat of a fire can indicate whether accelerants may have been used. Different chemicals cause reactions that can increase the heat of a fire. While wood fires can be just as hot, it is worth taking a second look if there are other suspicious indicators at the scene. If items are melted, the following list of temperatures at which different materials succumb is a useful starting point to an investigation:

·Solder melts at 361º F.

·Tin melts at 449º F.

·Lead melts at 618º F.

·Zinc melts at 786º F

·Magnesium melts at 1203º F.

·Aluminum melts at 1220º F.

·Glass melts at 1400º F.

·Copper melts at 1981º F.

·Steel melts at 2606º F.

·Iron melts at 2795º F.

Again, the fire department investigators are helpful here as you may not know what type of material different objects were made of; fire investigators are good at identifying composition of common items. Many items may be composite as well, a blend of various substances. Most metals are alloys and each component will melt at a different temperature. Always examine for melting indicators that will point toward a source of heat. The side of a metal item that has melted is usually the side that is facing the source of heat. This can be used as another indicator pointing back to where the fire came from to help the investigator establish a point or points of origin of the fire.

Indicators of Accelerants

The thing about accelerants is that they do not just disappear, much to the dismay of most fire setters. Accelerants can leave a variety of traces which are clear indicators that the fire did not start spontaneously.

Spalling is one such indicator. Spalling occurs when water trapped in concrete is heated and expands, thus exploding from the concrete leaving telltale marks. Spalling also occurs from the breakdown of surface layers of the concrete due to high temperatures. Marks left by spalling include discoloration of the masonry, pitting, rough texture, or striated lines. However, spalling is not always an indicator of arson. Science has shown that there are many causes of spalling that have nothing to do with the intentional setting of a fire. As in any investigation, all variables must be looked at closely.

When using an accelerant, many fire setters pour it onto the floor or carpet, and some may pour it along walls in order to give the fire a good start. When a liquid is spilled onto a carpet and the fumes are ignited, an outline of the spill can readily be seen. This is because the liquid gasoline does not burn. The liquid keeps the carpet on which it was poured cooler than the surrounding air and there will be islands of unburned carpet visible if the fire was extinguished quickly.

Aside from pouring the accelerant along a particular path, some arsonists will use a “trailer,” which is a substance used to spread and accelerate a fire so that the fire buildup is rapid and covers a large area. The arsonist intends the fire to be so complete there will be no evidence of the trailer left. Trailers can be as sophisticated as small plastic bags filled with accelerants and suspended from ceilings or as simple as newspapers spread throughout a house and sprinkled with accelerants. If they are not totally destroyed in the fire the trailers leading from one room to another will be very obvious.

Aside from visible signs of accelerants, residual vapors can also indicate the use of an accelerant. There are chemical sniffers that detect accelerants as well as trained dogs; the dogs are at times able to pick up on trace amounts of accelerants that the vapor detectors cannot detect. Samples of suspected accelerants can also be sent to labs for analysis; the lab can identify each substance in the sample and whether or not an accelerant was sued.

Incendiary Devices

Once an accelerant has been placed, the fire must be lit. A clever arsonist will generally not want to be present when the fire starts in order to give himself an alibi, so some sort if incendiary device may be used.

Incendiary devices come in many different shapes and sizes, some simple, some quite elaborate in design. All have the same objective: to burn themselves or to set something else on fire.

Each device consists of three or more basic major components: the fuse, the body, and the filler or incendiary material. The body will either be fragile or unbreakable, depending on its desired usage. A device employing the use of a flammable liquid will usually have a breakable container, while a device containing thermite or other explosive material will be confined to a non-breakable, metal container.

The combination of matches and a cigarette is a simple and often-used incendiary device. It can be assembled in several different ways. One of the most common is to place a cigarette horizontally, just along the tops of the heads of a book of matches after the cover is removed. The distance that the end of the cigarette protrudes beyond the row of match heads measures the amount of delay time wanted by the arsonist. The cigarette is lit. As it burns, it eventually comes in contact with the match heads, which burst into flames. Sometimes, the matches are placed around the cigarette and wrapped with tape, rubber bands, string, or wire. The cigarette/match device is sometimes weighted with a nail or a bag of rocks. This type of incendiary device can be used in conjunction with any combustible or flammable materials. The adjuster who detects the remains of such a device must immediately retain the services of a fire cause-and-origin investigator and a coverage lawyer experienced in fraud and arson.

Candles have been used for centuries as a timed ignition device. A candle will burn at various rates, depending on its composition and size. A candle of three-quarters of an inch to one inch in diameter will usually provide an hour's burning time for each inch of candle. The arsonist will place the candle in an area of readily combustible material, such as newspapers, light draperies, or an open bag of potato chips. Candle wax is rarely completely consumed in a fire. Again, there are generally remnants that if found indicate that further investigation and the services of a cause-and-origin investigator are needed.

Similar to candles is a device made from paraffin and sawdust. The melted paraffin is combined with a quantity of sawdust and allowed to cool. The wax mixture is then placed into a paper bag next to the intended target. A match is used to ignite the paper bag, and that in turn ignites the wax/sawdust mixture. The fire starts very slowly, taking about two or three minutes before the wax/sawdust mixture is burning strongly enough to spread flames throughout the structure.

Any electrical system can be used as a fire-setting tool. Arsonists will often set fires near electrical devices to fool cause–and-origin investigators into concluding that the fire was accidentally caused by faulty electrical equipment. Almost any type of electrical appliance can be arranged in such a manner that it will come in contact with combustible materials in order to start ignition after a period of time. They can also be tampered with to create a short circuit.

The favorite tool of the revolutionary, the “Molotov Cocktail,” can be used to start a fire. It is a crude incendiary device and consists of a fragile container filled with a flammable liquid, usually gasoline. It is fitted with a wick or some other similar ignition device that ignites the contents upon impact or breakage. The adjuster who detects the remains of such a device, such as broken glass in an area where it does not belong may have just discovered that his fire claim is really an arson claim.

To recap, there are a number of factors that may indicate that a fire was incendiary in origin:

·Trailers (connections to or between fire sets);

·Candles used to ignite fire or trailers;

·Discarded matches in out of the way places;

·Chemicals that are unusual for the occupancy;

·Rags, clothing, or curtains soaked in oils;

·Timing devices;

·Unusual arrangements of electrical equipment;

·Electrical equipment that had been tampered with before the fire;

·Disturbed or broken gas piping;

·Gas burners in the “ON” position;

·Unexplained multiple fires;

·Rearrangement of the contents of a room or area in an unnatural way to help the fire burn rapidly;

·Accelerant containers, accelerant patterns, or other evidence of the presence of combustible liquids;

·Fire late at night;

·Fire in a vacant building;

·Unusual burn patterns; and

·Lack of contents in a dwelling that was reported to have been occupied at the time of the fire.

None of these factors, standing alone, allow for the conclusion that a fire is incendiary, but they are all factors that should lead an adjuster to conduct a more thorough investigation. There are many false indicators that can lead an adjuster astray. Styrofoam beans in beanbag chairs will melt when exposed to fire and flow across a surface imitating the irregular pattern associated with flammable liquids. Mattresses filled with a plastic foam material can, when heated, leave patterns that are similar to flammable liquid spills. Legal storage of flammable liquids by an insured camp stove fuel, or gasoline in a lawnmower, for example will accelerate a fire.

Experts and Others

The International Association of Arson Investigators (IAAI) has established a Certified Fire Investigator (CFI) standard that requires many years of experience and continuing education. A person with a CFI designation is a logical first choice when an expert is required. Other options might be ex-fire department personnel who have first-hand knowledge of fire behavior, how fire burns, and firefighting tactics, or ex-police fire and bomb squad personnel. Background experience, tied with investigative ability, should be considered an asset for a fire cause expert.

It is also important to consider the following questions:

·Is the investigator familiar with insurance and the adjusting process?

·Does the investigator regularly upgrade skills by attending seminars dealing with fire investigation?

·Is the investigator a member of the IAAI and/or the local chapter?

·Is the investigator conversant with the requirements set by the National Fire Protection Association (NFPA) for arson investigation?

·Has the investigator testified in court as an expert?

oHow many times?

oIn civil as well as criminal matters?

oWas the testimony limited to state or federal court trials?

·Does the experience of the investigator fit the type of fire to be investigated?

Before you decide on an investigator, obtain a copy of reports the person has prepared. It is essential that the investigator write well. Regardless of training and skill, if he or she cannot express the results of the investigation in a clear, concise, logical, and timely manner the investigator is useless to the insurance fraud professional.

Other professionals may be able to provide much needed assistance as well; investigation of large fires is seldom handled alone. Any combination of the following experts may be crucial in determining the true cause of loss and whether or not fraud was involved. Using this many experts will be expensive, so an adjuster must weigh the existing evidence he has that is causing him to suspect fraud in the first place with company policy and cost of the claim. This is why adjusters must develop their own skills and expertise; they cannot always have the luxury of a team of experts to assist in an investigation.

·A fire cause-and-origin investigator: responsible for determining how the fire started, where it started, when it started, what caused it to start, and might also form an opinion as to who caused the fire to occur;

·A first party property attorney who has experience in arson and fraud matters: establishes subrogation, if the insured did not commit the arson, to recover the indemnity the insurer is to pay and collect it from the wrongdoer. The attorney will also direct an investigation that will help establish an arson-for-profit scheme and help the investigation by conducting examinations under oath of the insured and witnesses and advise the insurer of its rights, duties, and obligations under the law;

·A private investigator: completes the investigation that is recommended by the attorney that is outside the scope of the duties of a fire cause-and origin investigator. He or she will, among other things, establish the title of the insured in the property, all encumbrances, the financial condition of the insured at the time of loss, the insured's loss record, litigation history, criminal background (if any), etc.;

·An engineering consultant: determines whether any devices that may have caused the fire were, as a matter of scientific certainty, a cause of the fire. The engineer can also establish that a suspected device was not involved as a cause of the fire and therefore establish the only other possible cause was arson. The engineer will also be useful at the time of trial as an expert witness;

·A laboratory technician: establishes through gas chromatography the accelerants used, if any, in the fire;

·A forensic accountant: works with attorneys to produce evidence from the books and records of the insured that can help establish or remove the motive element of arson, but it must be proven for a jury to deprive an insured of the benefits of the insurance contract. In civil matters, before an insurer can convince a court of the fact that a fire was arson by its insured, it must establish that there was a motive for the fire. The motive can be cash, spite, or even relief from a long lease or long-term debt. The other members of the team will help in establishing the “opportunity” and “ability” elements needed to prove arson-for-profit; and

·A Certified Fraud Examiner, who is a person specially qualified to take the work of all of the others and tie together the elements of the tort of fraud that is necessary to prove a fire was an arson-for-profit.

Investigation Research

Once a fire has occurred, a lot of background research may need to be conducted if arson is suspected. An insured's financial situation is always key, as is the condition of the premises and any information witnesses may have of the event. The following list provides a baseline to work from:

·A ten-year ownership history of the property—collect deeds from the insured or order from a title insurance company a title history with deeds attached;

·A ten-year history of mortgages and liens on the property;

·Copies of the following files from the local building department:

opermits;

ocitations;

oinspection reports.

·The utilities, electrical, gas, and telephone records for the property for at least six months prior to the fire;

·Any change of address documents filed with the Postal Service;

·All property tax filings and payment records;

·Insurance records for last five years; and

·If it is a commercial property, collect the following documents:

oSecretary of state incorporation records and annual reports;

oSales tax filings;

oA search of public records regarding other properties owned by commercial business;

oUCC filings;

oFictitious business name filings;

oCommercial credit reports; and

oA list of vendors and suppliers of the business.

In addition to gathering documents the arson investigation team should also conduct interviews with, at least, the following:

·The building occupant;

·The building owner;

·All persons who qualify as an insured;

·All insurance agents and brokers involved in the acquisition of the insurance;

·All lien holders or mortgages;

·Creditors, suppliers, and vendors;

·The person who discovered the fire;

·The person who reported the fire;

·All fire scene witnesses;

·Neighbors and adjoining property owners or businesses;

·The responding firefighters and captains;

·Investigating law enforcement personnel;

·Realtors and sales agents involved in the most recent sale or listing of the property as well as neighboring properties;

·The insurance company underwriter;

·The cause and origin investigator.

The essence of a successful investigation of a potential arson-for-profit fire is a systematic and comprehensive investigation. To be performed properly there must be a commitment of investigative resources and the use of a complete and well-founded investigative team from both the public entities that investigate crimes and the insurer's Special Investigative Unit.

Summary

Once the claim has been researched it can be determined whether or not fraud was an issue. While fire claims look simple enough on the outside, as you can see there are a lot of details that must be considered, especially if indicators point towards possible fraud. As mentioned earlier fire is always a covered cause of loss, unless fraud was involved or the fire was intentionally set.