Beggs area insurance company rating improved dramatically; insurance rates could be affected with change\ Published July 25, 2014 It’s been just over a year since the complicated Insurance Services Office (ISO) re-evaluated the Beggs and Okmulgee fire districts. ISO is an insurance risk evaluation company based in New Jersey that provides statistical information to insurance companies. It is a for profit, organization not a government agency. For many years the ISO Rating had a large impact on most fire departments. The ratings are called Public Protection Classifications or PPC and are ranked from 1 to 10 with 1 being the best. At one time, almost, all insurance companies calculated rates based upon the ISO evaluation. ISO would come to the city and assess nearly every aspect of a city and the fire department including equipment, training, personnel, the geographic distribution of equipment, even the distance between hydrants. That evaluation accounts for 50 percent of the ranking. The evaluation also involves looking at the city’s water towers, hydrants, infrastructure and water sources, which is another 40 percent of the rating. The final 10 percent is based on communication systems, telephone lines, staffing and dispatch systems. This data is then sold to the insurance companies. The company historically has only awarded a few cities with a Class 1 rating. Currently there are more than 40 cities with a 1 rating. In the last few months of former Mayor Ricky Mitchell’s term, he and the department’s volunteers spent many hours filling out the paperwork required for an evaluation. Mitchell, who is also the Okmulgee City Fire Chief, took on the task of having an ISO evaluation of the City of Okmulgee, the Rural Beggs Fire Department and the City of Beggs Fire Department all at the same time. According to Mitchell, the cooperative agreement between the two Beggs departments allowed both departments to achieve a higher ranking than they would have been able to do individually. Among the tests performed is the amount of gallons that can be pumped per hour. Mitchell says the departments had to prove they could pump 30,000 gallons in a 2 hour period anywhere within the districts. Mitchell said new pumps obtained for the water plant and more water tank capacity, resulted in the lowering of both department’s ratings from and 8 to 5, a 30 percent improvement. The City of Beggs was notified of the results in May 2013, after Mitchell had left office. “I think it is important that the property owners in the area are aware of the change and they talk to their insurance agents to make sure they are getting credit for the improvement. It could mean a 10 to 15 percent reduction in the fire peril component of the insurance premium,” Mitchell noted. According to Kevin Stoneking, the ISO Fire Coordinator for the Oklahoma Insurance Division, a 5 rating is “pretty good fire protection.” Stoneking’s job is to help cities improve their ISO ratings. A former member of the Oklahoma City Fire Department, Stoneking has worked with about 250 cities throughout the state in the past few years. He said the state does not require insurance companies to use the ISO rating system as part of their rate setting plans. “State Farm Insurance is so large that they have their own actuaries and develop their own information.” State Farm has not used the ISO data in Oklahoma since 2001. Stoneking added, “For instance in the past few years Moore (Okla.) has had three tornados. That’s a major weather peril and some companies consider weather perils more of a factor in setting residential insurance rates than fire. Fire peril is in the equation. What insurance companies want to know is how effective can a fire department be in stopping a fire. It is a measure of effectiveness. In western Oklahoma the lack of water is a major factor. “In the past few years, there has been a drastic improvement in the ISO ratings throughout the state. If a department was last reviewed in 1996, then it’s time for a review. “The grading system for ISO ratings change two years ago. So if the rating is three years or more old, then it is unlikely it would be the same today.” A number of changes to the rating system now includes more technological advances in equipment as well as an emphasis on public education. “The Fire Wise Program, which makes the public aware of the need to cleanup around structures, keep combustibles away from buildings including trees and cedars, is now part of the evaluation. Public education and a smoke detector program is now considered.”
Posted on: Thu, 31 Jul 2014 15:13:47 +0000
Trending Topics
Recently Viewed Topics
© 2015