How can buildings in UAE navigate insurance implications of fires?

Building fires were listed among the top ‘site risks’ by the United Nations’ International Labour Organisation (ILO) in 2019. Over the years, safety holds multiple definitions for the industry, but the question remains: how has the industry adapted to be better equipped to tackle fires? 

The Sharjah Abbco Tower fire in May 2020, which gutted the “49-floor tower of 328 residential apartments and parking,” impacted first the façade that was made of “quick-burning materials, such as aluminium-clad panels (ACP),” Construction Week reported.

Addressing the risks that buildings in the region are most vulnerable to, Cavendish Maxwell’s Head of Project and Building Consultancy, Benjamin Walker told Construction Week: “In terms of vulnerabilities for buildings in the UAE, the biggest talking point would be the fire risk, given the significant high-profile fires here in the region. And, that really stems from the use of aluminium composite panel cladding (ACP), which increases the risk of a building.”

He continued: “Dubai has sky-rocketed and grown exponentially. About 20-30 years ago when the focus was largely on low-rises was not prolific, but over the last 20 years, whilst the landscape has grown in area, it has grown in height as well with the implementation of high-rises largely clad in ACP, and with that comes a different risk profile for buildings in the UAE.”

The increased risk of fires has effectively “increased premiums across the board, and they are continually increasing,” Walker said, adding that the municipality is doing their best to outlaw certain types of cladding and facilitate replacement of some areas of cladding.

Walker advised that building owners and managers carry out the first risk assessment of their property as a starting point. “It is important to understand whether the cladding is high, low, or medium risk and how that can be mitigated. A number of factors play into the risk profile of the cladding and building overall.”

“Insurers we’ve spoken are taking a worst-case scenario for any building clad with ACP. At Cavendish Maxwell, we then assess such a scenario and provide a detailed information package about that cladding, which can then be passed to the insurer, who can allocate an insurance better with a view to reduce premiums.”