ISO Refusal to Recognize Klamath County Fire District No. 1
Fire Station 5, 4950 Lakeshore Drive
For Property Protection Class Reduction

BACKGROUND:
The Insurance Services Office (ISO) is a Private Nonprofit Organization that evaluates fire loss risks based upon a Fire Suppression Rating Schedule that ISO developed for their use to determine the capability of a fire department to respond and suppress fires. The rating schedule assigns a numeric value called the Public Protection Class (PPC), ranging from 1 – 10, to a fire department or an area within the boundaries of the fire department. Insurance companies that subscribe to ISO services, and pay fees to ISO, use the PPC number to establish fire insurance premiums. The lower PPC numbers result in lower fire insurance premiums.

Prior to 2003 the residents of the Running Y enjoyed an ISO PPC of 4, the lowest within Fire District No 1. In 2003 ISO implemented a “5 Mile Rule” which changed the PPC from 4 to 10 (unprotected) for all properties that were located more than 5 road miles from the closest fire station. The new classification resulted in Fire Insurance premiums increasing by 300% – 400% for many properties within Fire District No. 1, including Running Y properties.

In 2008 Klamath County Fire District No. 1 completed the design and construction of a new fire station at 4950 Lakeshore Drive at a final cost of almost $1.7 million. In November 2008, 3 full-time firefighters were assigned to a Fire Engine at Station 5 to work 24-hours shifts 365 days per year, as is the case for all of the other 4 fire stations. The new Fire Station 5 was built and staffed in a good faith effort to reduce the ISO PPC back to the pre-2003 Class 4 and thereby reduce fire insurance premiums for property owners.

Since November of 2008, Fire District No. 1 staff believed that we had complied with ISO requirements for ISO recognition of Fire Station 5 and that the PPC for the Running Y had returned to a Class 4. We recently corresponded with ISO and were informed in a letter dated July 30, 2010. (click to view ISO correspondence) that they did not recognize the new Fire Station 5 and the PPC for the Running Y was still a 10.

CURRENT STATUS:
In spite of the Fire District’s substantial investment in the new fire station and personnel, ISO refuses to recognize the fire station in their latest letter to the Fire District dated July 30, 2010 (click to view ISO correspondence). The effect of their refusal is that Running Y properties, as well as other properties within 5 road miles of Station 5  will remain as PPC 10 which assumes there is NO responding Fire Department at all. ISO has said that in order for them to recognize Station 5 the Fire District would have to assure that a minimum of 4 firefighters be assigned to the fire station per 24-hr shift, 365 days per year.

Regretfully, Klamath County Fire District No. 1 simply does not have the financial resources to hire additional firefighters for the purpose of increasing staff to gain ISO recognition of Station 5.

CONCLUSION:
Klamath County Fire District No. 1 has exhausted all available resources to gain ISO recognition of Station 5. For the foreseeable future, Station 5 will not be recognized by ISO. However, the Fire District is in the process of challenging the ISO 7/30/2010 refusal to recognize Fire Station 5.

It is important to note that some large insurance companies do NOT use the services of ISO and establish insurance premiums based upon their own internal policies and may even conduct inspections of properties prior to insuring the property. Reportedly, at least 1 in 4 properties are insured by companies that do NOT use the services of ISO.

Property owners that are dissatisfied with their fire insurance premiums are encouraged to shop other insurers for the most competitive prices. (see below)

Respectfully,

Jim Wenzel, Fire Chief

 

 

The following insurance compies are NOT using the ISO PPC rating schedule. These companies base the protection class on the number of miles from a responding staiton and location of a water source.

• Sublimity
• State Farm

The following insurance companies are currently using the ISO PPC rating schedule.

• AAA
• AIG
• Allied
• All State
• American Family Insurance
• Country Financial
• Farmers Insurance
• Foremost
• Geico
• Liberty Mutual
• Met Life
• MIS
• Mutual of Enumclaw
• Nation Wide
• Oregon Mutual
• Safeco
• Traveler’s
• USAA

These lists are not a complete directory of insurance companies.