Skip to content
Home » Insurance and the cold chain: Fire risk

Insurance and the cold chain: Fire risk

  • marimac 

By Benjamin Brits

Considered one of the most difficult aspects for both insurers and clients to anticipate and manage are risks related to fire.

Facility fires can reach temperatures of over 1 500°C – a temperature hot enough to melt most metals. Image credit: Arny Mogensen | Unsplash
Facility fires can reach temperatures of over 1 500°C – a temperature hot enough to melt most metals. Image credit: Arny Mogensen | Unsplash

This is the second in a three-part series. The final article in the series will cover monitoring and telematics and their influence in insurance. The first part of the series was published in the November/December 2021 issue of Cold Link Africa and can also be found online at

Also read: Insurance and the cold chain – Part1

It must be stated for the record that views or opinions published in this article are based on those of participants from industry, while Cold Link Africa, its employees, and directors, bring attention to the role of this brand being to act as a vehicle for information to be shared, and where conversations can be initiated by industry for the better – many times this is a sensitive matter as opinions differ. In no way is our role to be the ‘jury, judge and executioner’. Further, many participants get invited to partake in the supply of information and some do not respond. This impacts the reported view on a particular subject. Features such as this are intended as an overview, and the publishers acknowledge that this is a vast subject matter that could in fact take up many issues. Industry is welcome to submit responses to any article published.

Register for free to gain access the digital library for Cold Link Africa publications

Fire is an element that all businesses have to contend with, with so many items that exist in operations that could start and accelerate an incident. Even in an office environment where one would think this risk is impossible, all you have to do is look around and take note of all of the every-day items that are combustible such as paper or cardboard, plastics, or chemicals – even the things you think don’t burn. Fire also never occurs by itself – smoke and fumes as a by-product of this element are said to be even more dangerous for people, products, and the environment, both short- and long-term.

Considering the many opinions received over this subject, it is really a case of the good, the bad and the ugly. It is also a subject that, when opened up, provides quite an intense conversation with very opposing views and logic applied to those views. Many industry participants seem unhappy with the current state of affairs related to certain fire risk aspects, and equally others are pro the status given a few tweaks can be implemented. Covering all of the bases has been considered a heavy burden to meet, and alternate views are that the consequences of incidents occurring should be the greater concern. Strong opinions from both angles really create an environment where more questions need to be answered, and we welcome our readers input to the matter.

Over the past few years, several major fire incidents have occurred around the globe in increasing frequency, some of which have unfortunately resulted in loss of life. In South Africa during the 2021 unrest, a number of facilities, shops and retail outlets succumbed to fire, generating significant losses and therefore the insurance sector has found itself under immense pressure of late. It has been suggested that the claim value linked to the riots and looting of that period now holds the largest value of any claim of this nature in the world! Facility owners on the other hand have faced difficult choices too as operations have been severely impacted.

With disruption in supply chains such as that, economies are also subject to inflation and hyper-inflation that adversely affect a business’ risk exposure that is linked to such cyclical conditions. This aspect has to constantly be monitored and adjusted through the actuarial sciences based on a number of conditions and influences. A region’s overall economic position, for example where the level of social unrest increases and thus changes the likelihood of an incident – would lead to reflecting premium adjustments too. This in turn creates additional pressure onto business profitability that most often gets offset onto the consumer; a tough cycle.

People unfortunate enough to have been involved in a fire-related incident in the cold chain, would have few other ways to share such an experience. They would describe the panic and helplessness, they would describe the intensity, what they smelt, tasted and even possibly be able to describe a ‘rain of fire’ as well as the clouds of different coloured smoke, and then the emotions of seeing the devastation that was left behind afterwards – mostly molten blobs of who knows what. Now although that could be a paragraph out of novel and sounds very dramatic, it is in fact the reality of a situation like this and illustrates what a fire incident represents. One would only assume that this experience is one to avoid as far as possible.

In the cold chain there are many combustible products – pallets as an example are common at almost all facilities. A risk management strategy would include how to mitigate fire risk related to this type of product. Image credit: Claudio Losa | Pixabay
In the cold chain there are many combustible products – pallets as an example are common at almost all facilities. A risk management strategy would include how to mitigate fire risk related to this type of product. Image credit: Claudio Losa | Pixabay

Register for free to gain access the digital library for Cold Link Africa publications

Fire risk is vast and can occur from an office to a storage room to a plant space. It can involve error, a third party, an unexpected act of nature, a neglected maintenance routine, a poor following of standards, and even malice. Each scenario holds different conditions too and the severity of an incident could be well managed an in worst case scenarios, lead to a total loss of a facility.

Considering the subject matter and views from the insurer, client, and supplier’s point of view there are many factors to consider in this very complex matter. Some partnerships choose to throw caution to the wind where the business model directs choice based on cheapest price and on the other hand, facility owners may insist on only the best of the best – no matter the price and where the impact and costs down the line are more important factors. Other concerns range from local testing options and methodologies to the client’s understanding of technical aspects of products, to ‘policing’ that too is lacking on the local front essentially allowing for establishment of poor facilities. Locally the business culture has always been of a reactive nature, however this mindset is shifting as global drives for environmental health and efficiency provide pressure to change.

On this subject one has to consider existing standards, compliance, and global best practices. We are no longer operating in a country silo, but rather aiming to compete in a global market. Not to forget our increasing exports, many international brands are establishing themselves in the region and require products and services that are in line with international quality standards related to fire.

Understanding fire, suppression systems and design

Knowing more about fire and how to deal with the risk is something that would add value to many industry participants. It also helps to put into context the aspects often referred to in the industry and how products are rated and tested.

An installation of insulated panels undergoing a fire test. Image credit: Kingspan Group
An installation of insulated panels undergoing a fire test. Image credit: Kingspan Group

Fire resistance

Resistance is the property of a material or combination of materials to withstand fire and continue to perform its given function, and further, provide containment for a specified period of time. Time being of particular importance, as not many individual materials can withstand fire indefinitely without some impact to its structure. Steel for example may have a longer resistance but will undergo severe structural changes given exposure to a particular temperature and length of exposure.

Each element that exists in the world will have its own resistance properties, however, when combining materials, these properties may change slightly or extensively. This is known as a material reaction. Reaction to fire is thus the response of a material or product in decomposition exposure to the element. Further, reaction involves combustibility and ignitability of a material and may or may not contribute to the growth of a fire, and this aspect is important in the early stages of a fire as it speeds up or slows down the incident.

Reaction testing

Reaction to fire is classified by international standards according to different ratings and performance through evaluation using a combination of tests that include: extent of burning and damage, flame spread, heat release, smoke production and altered form flaming. For all construction products, the tests take into consideration a fire initiated in a room which can grow and eventually reach flashover.

Flashover is generally understood to be the moment in the development of a space fire in which all exposed surfaces pyrolise and reach ignition temperatures more or less simultaneously, and it then transitions from a fire in a space to a space on fire. It is the tipping point between the growth stage and the fire becoming fully developed.

It is extremely important to understand the behaviour of building materials and to what extent, once exposed to fire, these will contribute to fire propagation. Often, testing is done on a small scale to determine an outcome, however, more thorough tests on large scale have shown to provide different results as well as when different materials are partnered in the testing. The interaction of all the components in a system in response to a fire has seen a lot of research over decades of testing.

Water and sprinkler systems are still by far the most prevalent suppression system used in South Africa, although water or mist in cold chain applications can save a structure, it can ruin held or processed goods. Image credit: Claudio Losa | Pixabay
Water and sprinkler systems are still by far the most prevalent suppression system used in South Africa, although water or mist in cold chain applications can save a structure, it can ruin held or processed goods. Image credit: Claudio Losa | Pixabay

Register for free to gain access the digital library for Cold Link Africa publications

Types of fire suppression systems

Depending on the type of facility within the cold chain, the process or associated production, there are several types of fire suppression systems, all of which have their own key features and benefits, or cons. It is fundamental in the system design stage to understand what is being protected and what are the potential fire hazards. Some examples of these systems include:

  • water-based systems – the typical sprinkler system linked to a reservoir and powered by fire pump sets.
  • foam systems – depending on certain liquids such as oil or grease that will react adversely to water, foam systems are designed for applications that involve these types of conditions.
  • Pressurised gas systems – gas is kept as a liquid under pressure. When a fire is detected, the system releases the gas, and it has a chemical reaction with the fire to extinguish it.
  • Hypoxic systems – displacement of the percentage Oxygen in the room to less than 17% which prevents fire ignition.

Engineered vs pre-engineered systems

Two common types of fire suppression systems are engineered and pre-engineered systems. An engineered fire suppression system works by flooding an entire room with clean agent. Clean agents are gases that suppress fires without harming humans or equipment. A cold store or food production facility is likely to undergo severe damage by a sprinkler system using water and are therefore a perfect fit for a clean agent engineered system.

Unlike engineered systems, pre-engineered systems do not flood an entire room. Instead, they are designed to protect smaller enclosures or special hazard areas. A fire suppression specialist would generally inform a client of the type of system appropriate for the application.

Register for free to gain access the digital library for Cold Link Africa publications

With a pre-engineered fire suppression system, a variety of chemical agents are used to suppress a fire. Dry chemicals, clean agents, or carbon dioxide may be utilised. The same clean agents that are used in engineered systems can be used in pre-engineered systems, offering many of the same benefits. The type of chemical agents used are highly dependent upon the class of fire, as well as the specific assets that require protection.

Different types of fire suppression systems also use different methods of fire detection. The two types of fire detection include active and non-electric detection systems. The active detection system needs an electrical power source to detect the fire by constantly monitoring for signs of heat or smoke. Active detection is very effective at sensing fires and automatically activating a fire suppression system. Active detection requires backup energy supply in cases where power is lost.

Non-electric fire detection systems do not rely on electricity. Fire detection tubing is installed in and around the protected environment. When the detection tube comes into contact with the heat from a fire, the tube bursts. This triggers the suppression agent to discharge and suppress the fire.

An automatic fire suppression system can either be a direct or an indirect release system. With a direct release system, the suppression agent is dispersed through the burst hole in the fire detection tubing directly on the fire. With the indirect release system, the discharge of the suppression agent happens through the diffuser nozzles, which floods the area to suppress the fire quickly and thoroughly.

Facility owner’s perspective

Fire is known to be a particularly challenging aspect in the cold chain due to the many points in a facility that have vulnerability, the many different materials used in construction, chemicals, systems in place, plant equipment, packaging, and even a product itself. Many factors both internally and externally come into play that require consideration – from product or equipment choices to various design elements and even third parties.

As many facility owners would offer their opinion over (as the ones who ultimately need to comply), the local market has for many years struggled with various testing, certification, standards, and regulations that are said to be ‘very outdated’. This is particularly relevant to fire (and smoke – including fumes) – with these aspects all essentially relying on international standard methodologies that align to far more stringent compliance than what is seen in this country, or that ‘supersede’ our standards.

Here an example would be pressure testing on pipes or vessels – international standards may require more, or less, than what local standards deem necessary – given the basis is from a highly conforming setting. This makes product compliance extremely difficult for local manufacturers and conditions that are not reflective of the ‘world we live in’. As another example, suggestions state that many aspects of the local building codes are no longer relevant for facility sizes seen today, or, specified requirements that insurance companies look to in compliance, now have far more advanced technology options available.

Register for free to gain access the digital library for Cold Link Africa publications

The use of precious resources such as potable water and the requirements of very large on-site tanks and sprinkler systems, as a further example, come under question from a moral point of view, not to mention that water as a fire suppression mechanism in most facilities in the cold chain are more detrimental than beneficial. It is a fact that the products kept or processed at a facility in this context are likely to hold a value that exceeds the facility value itself. However, building codes in terms of fire are really set up to protect the asset and said not take the product within the facility into account. A significant percentage of certain panelling used at cold chain facilities (particularly older sites) also absorb moisture that then affects insulation properties should a sprinkler system be activated through incident or accident. Water has recently been named again as one of the major world risks, that has been side-lined and forgotten about due to the decarbonisation and energy efficiency drives.

Fire, although a mesmerising element, is one of the most difficult aspects for insurers and clients to navigate. Image credit: Ricardo Gomez Angel | Unsplash
Fire, although a mesmerising element, is one of the most difficult aspects for insurers and clients to navigate. Image credit: Ricardo Gomez Angel | Unsplash

Although the viewpoint of ‘best price’ has historically also reigned, more facility owners today are turning to their own methodology in managing fire risk and are increasingly choosing to build better buildings and deploy better technologies (even above the local building standards), knowing the impact of a facility fire incident, even in part resulting in downtime can cripple and, in some instances, destroy a business. Downtime or the time required to re-build a facility holds the risk of losing market share, indefinitely. There is further an increased focus on stopping fire incidents from happening rather than the reactive approach of trying to quell a fire once it has started. So very much a passive versus active approach.

It was noted too that because of the old structure and relevance of the local building codes, too many facility owners go to great lengths to find loopholes around the laws and insurance requirements, however, this is to their own detriment as it leaves them with a less safe building and actually a far higher risk. Standards, although outdated, contain principles set out by experts to ensure quality and safety are met. They further provide guidelines that allow any occupant to have a higher chance of escape, rather than becoming trapped by structural failure.

As stated by one facility owner, although the ‘perfect storm’ could always occur, business is hard enough on its own without having to constantly be concerned and stressed over installing materials or systems in facilities that are known as higher risk than others. If one uses the best possible products and systems available, even if they cost a little more up front, in hindsight that little extra is really nothing when you consider the costs of down time at many facilities that operate 24/7, or the sleepless nights about if you will have a facility in the morning because of some random electrical spark from a light that you know will be an ideal ignition source. Using the best rated products, suppression systems and nitrogen rich air are some simple ways to mitigate fire risk in the cold chain (depending on the facility application of course).

Fire risk management for facility owners is further referred to as a process that is developed over the relationship between client and insurer and is not always a case of being ‘forced to jump through hoops’ to reach the levels set out in order to receive cover at a reasonable premium. Having the right insurance partner (from both an insurer and client perspective) is seen as crucial so that alignment exists. As with everything else in the world, conditions change and new best practices are developed, and so facility owners or managers should revise their insurance risk related to fire annually.

With the right partners (being partners that understand the particular business environment), planning and executing the correct fire risk strategy will always start with covering critical areas followed by progressively increasing your mitigation tools based on individual facility needs and likelihood of incident. Fire mitigation as a strategy is not always a once off upfront massive expense that needs to be undertaken and therefore feared or neglected.

Register for free to gain access the digital library for Cold Link Africa publications

Supplier views

Both local manufacturers and international providers to the local market in panelling had various comments to add and each experience their own challenges. Panelling as a major component on all aspects of the cold chain, is particularly of interest as here quality and production methodology is regularly under the spotlight. Certain panelling is also known to be one of the elements with the greatest fire risk in cold stores, even given the difficult concept to grasp of fire in below freezing conditions.

A definite conundrum exists in South Africa with regards to this, especially under the circumstances of current global trade. Local manufacturers, that produce various panel qualities and use different materials (polystyrene, polyurethane, polyisocyanurate or rockwool/glass fibre), have the challenge of either inefficient part testing or testing that is considered ‘brutal’ but necessary to ensure systems are ‘good enough’. Certification, as with so many other sectors is also a very time consuming and an expensive process. Imported products that meet international standards on the other hand are currently burdened with extreme shipping costs and delays due to disrupted shipping routed and container shortages.

Catering to different market needs, product pricing is only one element while a panel’s structural capacity and function have to be considered and can have a significant impact in a facility if a fire incident occurs. Each material that an insulated panel is made out of would have its own pros and cons. Some may stand up well but cost more while others’ performance over time deteriorates and could produce various toxic fumes that could kill people and contaminate stored or processed goods.

Also, important to consider when looking at panelling and fire risk is the fact that because some materials have a better rating, partial facility loss may be the best-case scenario rather than total loss. Partial loss enables a facility to continue operation, even if slightly disrupted however total loss means the possibility of months or years of downtime, depending on the circumstances.

The combination of panelling and fire suppression systems often comes at a very high proportionate cost in any facility and so the choice in these products can be difficult. It is not uncommon for the fire suppression system to actually cost more than all of the panelling required in a cold chain facility. Development in terms of the ‘DNA’ of panel materials has therefore seen great improvements over the last 40 years to be able to significantly lower fire risk and provide clients the assurance of product performance, and in turn reduce risk.

Register for free to gain access the digital library for Cold Link Africa publications

Abstract background photo created by -
Abstract background photo created by –


Many other documents with varying levels of technical data and perspectives have been published around fire testing of particular products (all required products), and these can be reviewed as further reading on the subject. Sometimes materials and products unfairly come under the spotlight through unsubstantiated claims or statements made.

Professionals in this sector would provide the best solution suggestions for any particular need. It is indeed the responsibility of industry to drive any changes required and to ensure their own due diligence is observed that in turn would ensure the safety aspects of any products are aligned to overall best practices. Change required should also find a platform of timeous action. With the changes seen of late and the development of new technologies regularly, so many new opportunities exist and would of course need an even playing field which has historically been a challenge.

Further information on fire safety and standards related to products in the cold chain can be obtained by connecting with the relevant local industry and insurance bodies.


  1. Amptec Fire & Security
  2. Automatic Sprinkler Inspection Bureau (ASIB)
  3. Capespan Group (base information)
  4. Expanded Polystyrene Association of South Africa
  5. Fire Trace International
  6. Kingspan
  7. Lockton South Africa (base information)
  8. Industry
  9. ResearchGate.

Register for free to gain access the digital library for Cold Link Africa publications