March 2007

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Small businesses urged to avoid fines by implementing new fire laws

SMALL BUSINESSES URGED NOT TO BLOW OUT NEW FIRE LAWS
Small business fires costs the UK economy £330 million

Small business insurer MORE TH>N BUSINESS is today warning an estimated one million small businesses that they could face penalties of up to £10,000 or even jail because they have not yet complied with new fire safety laws.

The insurer is urging all small businesses to comply with the Regulatory Reform (Fire Safety) Order, introduced in October 2006, not only to guard against the potential fines, but also to protect themselves and their workers from possible fires.

According to MORE TH>N BUSINESS, fire in small businesses costs the UK economy an estimated £330 million a year1. Statistics from MORE TH>N BUSINESS reveal that in 2006 the average cost of a fire claim was £26,0002. Yet the true cost to the business can be even larger: 80 per cent of small businesses affected by fire will not be trading a year later3.

The legislation does appear to be having an impact on small business fires – since it was introduced, MORE TH>N BUSINESS has seen a 36 per cent decrease in the number of fire claims compared with the same time period the year before4. However, the decrease could be much greater if all small businesses comply with the regulations.

The new laws place the responsibility for fire safety on the employer, who is required to carry out a fire risk assessment. It also means that the old fire certificates are now obsolete, and the fire and rescue authorities will be rigorously enforcing the regulations. Businesses with five or more employees must record the assessment findings, but MORE TH>N BUSINESS is urging all small businesses to do the same as good business practice.

Mike Bowman, head of insurance at MORE TH>N BUSINESS, explained: “The Regulatory Reform Fire Safety Order is the biggest shake-up in fire legislation for 30 years, yet many small businesses aren’t even aware the new law exists. We know that for a third of small businesses health and safety is their biggest burden, but we are calling for those who haven’t yet taken action on the law to set aside some time to make sure they are protected. It could save their livelihood, and even their lives.”

To help small businesses, MORE TH>N BUSINESS has posted a guide to the Regulatory Reform Order on its website at www.morethanbusiness.com. It’s recommended five steps for a fire risk assessment are:
1. Identify potential fire hazards in the workplace – e.g. potential sources of ignition and flammable materials.
2. Decide who (eg employees, visitors) might be in danger in the event of a fire, in the workplace or while trying to escape from it, and note their location.
3. Evaluate the risks arising from the hazards and decide whether your existing fire precautions are adequate or whether more should be done to get rid of the hazard or to control the risks (eg by improving fire precautions).
4. Record your findings and details of the action you took as a result. Tell your employees about your findings.
5. Keep the assessment under review and revisit it when necessary.

The changes to the law have been implemented through the new Regulatory Reform (Fire Safety) Order in England and Wales. In Scotland, they form part of the Fire (Scotland) Act 2005. The legislation applies to all premises that are not single private dwellings.

For further information on small business insurance from MORE TH>N BUSINESS call 0800 072 0077 or log onto www.morethanbusiness.com.

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