Southlake businesses may see a favorable economic impact with lower insurance premiums in the foreseeable future. Based on scoring from Insurance Services Office (ISO), an advisory organization that serves the property and casualty insurance industry, the Texas Department of Insurance and the State Fire Marshal’s Office have improved Southlake’s Public Protection Classification (PPC) to the highest rating. The nationwide classification system reflects a community’s fire protection capability for property insurance rating purposes.
Due largely in part to the addition of the DPS North Station that opened November 2013, which was strategically built to better serve northern parts of the city with enhanced emergency response times, Southlake’s PPC rating has improved from a Class Four to a Class One, the highest fire protection rating possible on a 10 class rating system. ISO classifies communities based on how well they score on the ISO Fire Suppression Rating Schedule, which grades a community’s emergency communications capabilities, fire department capabilities, and evaluates the water supply. The score that is determined from the rating schedule is translated into a PPC Class. A score of 90 points or more earns a Class One designation. Southlake received 97.53 out of 106.5 points to join an elite group of 22 cities in Texas and 62 cities in the nation to hold a PPC Class One rating.
Effective September 1, 2014, the new rating should affect fire insurance premiums for Southlake residents and businesses. Business owners should expect to see the greatest impact, with insurance premiums likely to drop more significantly for commercial real estate. Southlake Fire Chief Mike Starr said insurance premiums may drop by as much as 11 percent for residential properties and 13 percent for commercial properties.
“It is impossible to know the extent of insurance rate changes until after the new rating goes into effect, and even then, it may vary from different locations across the city. Most insurance carriers will not update this information until the policy renewal date,” said Southlake Farmers Insurance Agent, Brian Zvonecek.
Since insurance premiums are part of the cost of operating any business, the lower premiums in Southlake may benefit local businesses by decreasing overhead expenses. Business owners welcome this change because lower overhead expenses generally have a positive impact on the overall profitability of a business.
“This is just another one of the many benefits of owning a business and living here in Southlake,” stated Dave Garner, owner of Wildwood Grill and Fish City Grill. “This community has supported my family and me for more than a decade. We hope to continue to be a part of the long tradition of excellence we have come to expect here.”
For more information, contact your commercial real estate agent.
The Fire Department has received official notice from the Texas Department of Insurance and the State Fire Marshal’s Office that Southlake’s Public Protection Classification rating would be lowered from a Class 4 to a Class 1 following a comprehensive audit and evaluation.
The new rating, effective September 1, 2014, could mean savings on fire insurance premiums of 11% for Southlake residents and 13% for business owners.
“We are very proud of our Class 1 rating and it could not have been accomplished without the addition of the North DPS Facility and the improvements made by Public Works to our water system,” notes Fire Chief Mike Starr. According to Mike, Peach, P.E. Consulting Services Inc., Southlake received the highest score of 97.53 since the rating system was put into place in 1906.
Insurance Services Office (ISO), which collects information about municipal fire protection efforts in communities throughout the United States, supplies statistical, actuarial and underwriting information to insurance companies, fire departments, insurance regulators and others. ISO uses a rating system of 1 to 10, with Class 1 being the highest fire protection rating.
The rating determination are based primarily on three weighted areas:
1. The community’s emergency communications capabilities, including 911 telephone systems, adequacy of telephone lines, operator supervision and staffing, and dispatching systems. (10 percent)
2. The quality of the fire department, including adequacy of equipment, sufficiency of staffing, level of training and the geographic distribution of fire stations. (50 percent)
3. The evaluation of the water supply, which includes the condition and maintenance of fire hydrants; existence of alternative water sources; and the amount, volume and pressure of available water compared with the amount needed to suppress fires. (40 percent).
“Congratulations to the work teams who participated in this project,” said Chief Starr. “This is a great achievement for City employees and is a great benefit for City residents and businesses.”