Preventing Common and Costly Water Damage in Healthcare

By Heather Savino

Water intrusion and accidental discharge of water are two of the leading causes of commercial property loss in the healthcare industry, according to The Hartford’s risk engineering consultants.

In one instance, a deteriorating roof and blocked roof drains caused water to leak through the ceiling of a medical practice, resulting in $200,000 of property damage and $350,000 of lost income. The leak extensively damaged the practice’s operating room equipment, medical diagnostic equipment, backup surgical equipment, and servers and computer towers. Unfortunately, this type of scenario is common. Water damage can lead to high-severity claims and disrupt a practice’s ability to serve patients. Thus, healthcare organizations must prioritize water damage prevention strategies to avoid costly losses and keep their facilities running.

Water damage presents unique challenges for the healthcare industry, and reducing or preventing this damage delivers tremendous value to patients and healthcare providers. Water damage repairs can force patients to reschedule their appointments or even to find new doctors. Physically, water damage can result in direct costs that include cleanup, construction, material replacement, mold remediation, equipment repair, and increased insurance premiums. Meanwhile, indirect costs may consist of indoor quality issues, legal fees, managing patient and public reactions, delays in patient services, and downstream impacts from business interruption.

How common is water damage in the healthcare industry?

According to The Hartford’s claims data, both older buildings and new construction in the healthcare industry are vulnerable to water damage risks. The leading causes of loss relate to accidental discharge from heating and cooling systems, internal piping, fixtures, and appliances; pipe freezes; sprinkler leakage; and sewer drain backup. In addition, water damage losses can arise from subpar plumbing installation, making it important to hire an experienced contractor who has a proven history of high quality.

With this in mind, The Hartford has developed a series of steps that healthcare businesses can take to protect against water intrusion and damage.

Create a water damage prevention plan

A written water damage prevention plan (WDPP) plays a key role in preventing significant losses. It’s never too late to create one, and if a business does have a plan, regular reviews and updates are always a good idea.

The WDPP should include routine site inspections to identify uncontrolled water damage exposures; it should also include basic maintenance to make sure drains are clear of debris and divert water to a catch basin or low point away from the building. Further, an effective WDPP should incorporate technology and include backflow preventers on sewer connections, as well as water sensing technology to monitor the areas most vulnerable to exposure. In addition, a trained team of water damage responders should be recruited to map and label all zonal shutoff control valves, as well as maintain an updated list of contractors’ contact information for emergency purposes.

For water intrusion from domestic and liquid service systems, building owners should also prepare a WDPP comprised of water control valve tags, a map/drawing of the building’s key water control valves, procedures for managers or employees to follow when a leak or damaged water service system is identified, availability of cleanup and restoration supplies, and a contract with a water damage restoration contractor to ensure timely response and cleanup.

Determine high-risk areas for water intrusion

Although water can enter a building in many ways, there are several major areas a healthcare organization should pay attention to. Foremost is the building envelope, which includes the roof, walls, and floors, as well as interior systems such as piping for domestic water, hot water heaters, HVAC, water-sourced medical/dental equipment, process liquids, sprinkler protection, and building equipment and appliances. In addition, exterior exposureslike surface water from improper landscaping, gutters, downspouts, and weather-related hazards should be addressed.

Electronically monitor high-risk exposures

Building owners and managers can use technology to reduce high-cost water damage claims. Internet of things devices, like water sensors, can be used to help monitor for leaks. These  devices provide early identification alerts that would be ideal for installation in operating rooms or areas with sensitive equipment and diagnostics. The devices are easy to install and contain wireless detection technology connected to control valves for automated emergency shutoff, alert notifications to smartphones, and analytics on water usage.

Partnering with an experienced insurer

It’s no secret in the insurance industry that water damage claims are common. But healthcare businesses can stay safe by identifying risk areas, preparing a WDPP, and using technology to monitor and mitigate potential costly losses. If a water damage claim still occurs despite this, having an experienced insurance company is important. At The Hartford, risk engineering consultants work with healthcare organizations to identify and address risks.

In healthcare, when water damage occurs, it can interrupt patient services. It may also present challenges with bringing new patients in if there is a concern about the state of the building. Therefore, the impact of business interruption may far outweigh the loss of physical damage to the building and contents, and mitigating water damage loss is important in maintaining a high level of value for patients.

Heather Savino is head of healthcare at The Hartford. She has more than 20 years of underwriting experience with a specific focus on industry specialization in The Hartford’s niche and program business.