Preventable vs. Non-preventable losses.
For every known hazard there are controls established in the form of safety protocols, process guides, regulations, or standards, all designed to prevent loss occurrence.
Considering that strict management of safety protocol is required to effectively manage risk, the human element becomes the pivotal factor in determining “preventable”, or “non-preventable” occurrence of loss.
Therefore, losses can be classified as “Preventable” or “Non-preventable”, subject to any deviation of established process guides, regulations, or standards.
A “Preventable” loss occurs during the course of action when the human element fails to do everything reasonable to avoid the loss. Such a loss is considered to be foreseen as their actions are, counter to, or in deviation of required: maintenance practice, safety protocols, process guides, regulations, or standards.
A “Non-preventable” loss occurs during the course of action when all safety protocols, regulations, or standards are observed. Such a loss would be considered to be unforeseen as all reasonable efforts were made to avoid a loss.
Usually non-preventable losses also include; acts of nature and external influences such as initial acts of arson.
Examples of Preventable Loss:
· Electrical fire caused by: use of unlisted electrical equipment, over fusing, extension cord wiring, overloading electrical outlet (“octopus” wiring).
Human element; where there is deviation of electrical standards and safety protocol.
· Machine failure that causes fire.
Human element; when cause of failure is determined to be directly linked to: poor, or lack of equipment maintenance, alteration of equipment (not approved by OEM), use of equipment for unintended purpose, use of equipment beyond designed operating capacity.
· Chemical spill; filling overflow.
Human element; did not observe all required protocols in safe delivery/filling of chemical tank, or poor, or lacking equipment to prevent spills, or poor, or lacking maintenance program.
· Any loss where smoking is a factor.
Human element; it is common knowledge that discarded smoking waste poses risk of fire. Smoking is controlled in public buildings, and areas of specific hazard. It is reasonable to suggest that when someone ignites a cigarette, there is foreseeable risk of loss if smoking waste is not properly disposed of.
Examples of Non-preventable Loss:
· Electrical fire. No over fusing, no use of extension cord wire, no overloading of electrical outlet.
Human element; Loss was unforeseen. Adherence to all electrical codes and safety protocols, and maintenance is observed.
· Machine failure causes fire.
Human element; equipment is maintained as required, no equipment alteration (or has OEM approved alteration), machine is used for intended operation, and is not used beyond designed operating capacity.
· Chemical spill, filling overflow.
Human element; all filling protocols are observed without deviation. Spill occurred due to spontaneous equipment failure. (Equipment is known to be maintained).
NOTE: This document is intended to offer guidance in determination of preventable and non-preventable loss for statistical data gathering purposes only. It does not purport to be a definitive list of determining factors, or affirm fault of loss, or intervene in any claim handling procedure or decisions.