Equitable Charges for Sprinkler Fire Protection Service

Abstract

though the income from private fire protection in the average water works constitutes only 1 or 2 percent of the total income, quite frequently in rate hearings before regulatory bodies, there is as much evidence introduced relative to sprinkler rates as with respect to all other items of the schedule. It would seem that little controversy should arise over charges for a service which produces savings to the consumers having the service which are usually very much greater than the payments made to the water department which makes the service possible. Automatic sprinkler fire protection service is of direct value to those making the installation, is often of indirect value to adjoining properties and to a smaller extent, is also of value to the water utility and the community as a whole. The owner of the property who has installed an automatic sprinkler fire protection system profits through a reduction in his insurance rates usually in amounts varying from 60 to 80 percent of the total premium. To secure this reduction in premium, he is required to expend for the installation of the automatic sprinkler system an amount usually varying between 1 and 4 percent of the building cost. The annual cost to the owner, including therein the fixed charges for interest, depreciation, etc. on the cost of installation, is from 0.1 to 0.5 percent of the building cost. This annual expenditure, as before stated, results in saving from two-thirds to threefourths of the insurance bill. The cost of installing a sprinkler system is usually repaid in a very few years by reduced insurance premiums. Adjoining properties benefit from the installation made, due to the fact that the risk of conflagration spreading from the sprinklered