Mawuli Zogbenu: ‘Flood Fire’ Cigar to blame?
The events of Wednesday, June 3, 2015, was one that nobody ever anticipated, but the realities of life are hidden in the fact that “no one knows tomorrow” and that includes the next second! I was nearly a victim myself that fateful night, as I was torn between driving through the Kwame Nkrumah circle and using the N1 highway.
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Indeed, the unfortunate aftermath of the calamitous flood and inferno really confirmed to me that my choice of route was “God-directed.” Nevertheless, the wanton distractions caused by both floods and inferno; leading to unimaginable loss of lives and properties only reinforced the need for insurance, since the occurrence of mishaps and their resulting dire consequences, will continue to remain elusive.
Reports of ‘Flood Fire’
You may choose to describe it as ‘flood fire’ - A clash of water and fire! Over 152 precious Ghanaians reportedly lost their lives to floods and fire, after seeking refuge at one of the Nation’s busiest fuel stations, at the Kwame Nkrumah circle. Without prejudice to the ongoing investigations by the Fire Service and other security agencies, initial reports were sketchy and conflicting.
First, the inferno was alleged to have been caused by an electric generator, which was affected by the seeping flood waters and blew the entire combustibles into flames; and thus, extended to adjoining properties including vehicles, shops and houses; causing “instant justice” to the estimated 152 Ghanaians.
A second report alleged that the fire was caused by a lit “cigarette-like” char possibly falling into the flood waters from an adjoining house, contaminated by combustible petroleum products.
The relevance of the cause to insurance
Undoubtedly, the calamitous event came with heavy insurance implications, as insurers will have to brace themselves up for compensations to deserving individuals, business owners and families of the deceased.
Indeed, insurance policies ranging from funeral, public liability, machinery and equipment breakdown, personal accident, motor, business interruption, fire and allied perils, etc are some of those likely to hit the claims baskets of insurers.
Given the magnitude of destruction, the resulting losses are unquantifiable, considering the fact that human lives were involved. Chances are that identification of many of the bodies of the victims could pose a challenge, especially for life insurance compensations. The State, therefore, has a significant role to play here.
It must, however, be emphasized that, insurance claims can only be paid, after the cause(s) of the distraction are fully established. As to whether it was the floods that caused the fire or the fire that defied the power of water and ravaged the entire enclave instantly is a mystery that requires a deeper scientific understanding to unravel.
This notwithstanding, it is clear that there was a trigger e.g. the “cigarette-like char” or the generator. This therefore brings to mind the subject of Proximate Cause in insurance.
Proximate cause
The belief is that, every loss is the effect of some cause. Insurance policies cover only a limited catalogue of causes and it is important to examine carefully, the cause of any one loss.
The causes of a loss may be single or a chain of them – one prompted by the other.
The peril may be an insured one or an uninsured one or an excluded peril and that may create challenges. The onus is however on insurers to establish the nearest effective cause, that is, not necessarily the last, but the most dominant. This helps in the determination of claims payment, especially in disasters of this magnitude.
Proximate cause in claims processing
Suffice it to say, insurers investigate claims before payments are made. In technically cumbersome circumstances like this disaster, insurers may engage the services of professional Loss Adjusters to ensure fair compensation payment.
Thus, after reviewing the claim documentation, coupled with a satisfactory preliminary findings regarding the cause and extent of loss to lives and/or property, the Loss Adjuster will advise the insurer on the appropriate compensation to be paid.Instructively, the claims processes are faster when the insurer leads in the investigations (i.e. without relying on Loss Adjusters).
In the case of the fuel retail outlet, for instance, the owner may be required to submit proof of value of the loss for repairs and/or replacement, which will be thoroughly reviewed before a final consideration is made. Where public liability is established, however, the compensation payable (i.e. sum insured) becomes open for negotiation.
The way forward
The insuring public must always demonstrate greater responsibility in such unfortunate circumstance, by activating immediate responses or taking appropriate steps to minimize the damage to their lives and properties.
In this particular instance, there was a swift response from almost all the security agencies including the Fire Service, Police and the Military. But for the intervention of these agencies the level of distraction could have extended wider than we witnessed. Moreover, the insuring public must ensure that their insurance policies remain in force (and not lapsed) at all times to avoid claim repudiation. — GB