When a fire loss claim is filed, the insurance company must evaluate the claim and determine whether it is covered under the policy. In many cases, the insurer retains an independent fire investigator to conduct a separate origin and cause investigation. This practice is standard in the insurance industry, but policyholders who encounter it for the first time often have questions about why an independent investigation is being conducted, what it involves, and how it will affect their claim.
Why Insurers Retain Independent Investigators
Insurance companies have a contractual obligation to investigate claims before making coverage decisions. While fire departments conduct their own investigations and produce reports, these investigations serve a different purpose: they focus on public safety, fire prevention, and, when applicable, criminal prosecution. The fire department's investigation may not address all of the questions relevant to the insurance claim.
Independent fire investigators retained by insurers conduct their examinations with a focus on the specific issues that affect the claim. These include the precise origin and cause of the fire, whether the fire was accidental or intentional, whether any policy exclusions apply, and whether the physical evidence supports the claimed circumstances of the loss.
Insurers are more likely to retain an independent investigator when certain circumstances are present. Large losses, fires of undetermined cause, fires where the fire department report raises questions, fires involving vacant or unoccupied properties, and situations where the policyholder's account of events is inconsistent with the physical evidence all tend to trigger a more thorough investigation.
What the Independent Investigation Involves
Scene Examination
The independent fire investigator conducts a detailed examination of the fire scene, following the methodology prescribed by NFPA 921. This examination may occur days or weeks after the fire, depending on when the insurer retains the investigator and when scene access is arranged. The investigator documents the scene through photography, measurements, and written notes, and collects physical evidence as warranted.
For more, see The Fire Investigation Process.
In some cases, the independent investigator's scene examination occurs at the same time as examinations by other parties' experts. These joint examinations allow all interested parties to observe the scene and evidence under the same conditions, reducing later disputes about the condition of the evidence.
Evidence Analysis
Physical evidence collected from the scene may be submitted for laboratory analysis. Samples suspected of containing ignitable liquid residues are sent to forensic laboratories for gas chromatography-mass spectrometry analysis. Electrical components may undergo metallurgical examination. Appliances identified as potential fire causes may be examined and tested.
Record Review
The investigator reviews available records relevant to the fire, including fire department reports, dispatch records, 911 call transcripts, weather data, and building records. The policyholder's statements to the insurance company, including any recorded statements or examinations under oath, are also reviewed for consistency with the physical evidence.
Interviews
The investigator may interview witnesses, neighbors, fire department personnel, and other individuals who have relevant information about the fire. These interviews supplement the physical evidence and can provide important context about the events before, during, and after the fire.
How the Investigation Affects the Claim
The independent investigator's findings are reported to the insurance company and become a key factor in the claim decision. If the investigator determines that the fire was accidental and identifies a specific cause, the claim typically proceeds through the normal adjustment process, assuming the cause is a covered peril under the policy.
If the investigator determines that the fire was intentionally set, the insurer may deny the claim based on the policy's intentional act exclusion. This determination carries serious consequences for the policyholder and must be supported by evidence that meets the applicable legal standard.
For more, see Arson Investigation.
If the cause is classified as undetermined, the claim may be delayed while the insurer seeks additional information or conducts further investigation. An undetermined cause does not automatically result in a claim denial, but it may complicate the claims process.
The Investigator's Independence and Objectivity
Independent fire investigators retained by insurance companies are expected to conduct objective investigations and reach conclusions based on the evidence, not on the desires of the party that retained them. NFPA 921 explicitly requires that fire investigators avoid bias and follow the scientific method regardless of who engaged their services.
For more, see NFPA 1033: The Professional Qualifications Standard for Fire.
This objectivity is important not only as a professional and ethical obligation but also as a practical matter. An investigator whose conclusions appear to be influenced by the retaining party rather than supported by the evidence will face significant credibility challenges in deposition and at trial. Courts and juries are sensitive to the appearance of bias, and an investigator who consistently reaches conclusions favorable to the party paying the bill will eventually lose credibility.
Policyholder Rights During the Investigation
Policyholders have rights during the investigation process, though those rights vary by state. Most policies require policyholders to cooperate with the investigation, including providing access to the fire scene, submitting to examinations under oath, and producing requested documents. At the same time, policyholders have the right to retain their own fire investigation expert, to have legal counsel present during examinations under oath, and to challenge the insurer's findings through the appraisal process or litigation.
For more, see Fire Insurance Claims in the Midwest.
Key Takeaways
Insurance companies retain independent fire investigators to conduct thorough, objective origin and cause investigations that address the specific questions relevant to the insurance claim. These investigations follow the same NFPA 921 methodology used in all fire investigations and involve scene examination, evidence analysis, record review, and interviews. The investigator's findings directly influence the claim outcome, making the quality and objectivity of the investigation important to all parties involved. Policyholders should understand their cooperation obligations and their right to retain their own experts and legal counsel.