Preventing industrial risks is a discreet but essential job in the insurance sector. At Foyer Luxembourg, this mission is now embodied by a dedicated post. Youssef Azzaoui, who joined the group just under a year ago, is in charge of fire, explosion and business interruption prevention, having previously worked for Swiss Re and in the automotive and oil industries.
“I am called in by the underwriter to help him or her price the policy and get a more global view of the risk.” In practical terms, he goes to the customer’s premises to examine the installations. “I look at the risks in terms of production and buildings. This applies to the industrial world, but also to data centres, shopping centres and even homes. Construction is the first element that will enable us to take preventive action. If you have a wooden building, you know that everything can collapse.”
Then the analysis focuses on the activity itself and the processes used. The sources of risk can be very diverse: chemical reactions, lithium batteries or specific industrial processes. “Today we’re talking about electric vehicles, lithium batteries and processes that use exothermic chemical reactions [releasing energy, generally in the form of heat, editor’s note]. We’re also talking about data centres that are now heating up. We focus on the cyber risk, but we generally forget about the fire risk.” Yet these facilities concentrate a lot of energy and heat. “If we don’t cool things down enough, they can burn out very quickly.”
On the ground, teams are not always ready
Prevention is not just about technology. It also involves the human organisation of the company. During visits, the expert observes whether the teams are aware of the risks and know how to react. “We look to see whether people know their risks, are doing the right things to avoid a fire and whether they are trained to intervene. Everyone thinks that we always have teams in the industrial sector who can intervene to use fire extinguishers or hydrants. But in the field, we realise that this is not at all the case.”
We have chemists, oilmen, mining experts who have spent 20 years in the industry and who do prevention work solely in this field.
Risk assessment is based on a particularly broad analysis grid. “There are around 300 main criteria and they vary from one activity to another. The complexity of the business comes precisely from this diversity. “There are a huge number of criteria that vary from one geographical area to another, but also from one business to another. In large international groups, these analyses are often entrusted to sector specialists. “We have chemists, oilmen and mining experts who have spent 20 years in the field and who only carry out prevention in this area. In Luxembourg, the situation is different. “We have the advantage of being a generalist with a very varied portfolio.”
Another major challenge lies in communicating with companies. The reports must remain understandable to very different people. “We have to try to simplify the report and the recommendations as much as possible in the interests of pragmatism.” Above all, executives want to understand the practical implications. “We want to get straight to the point and know how much we need to invest to put things in place.” For all that, technical analysis remains much more detailed in the background. “We always have the detail. The report is made to communicate to as many people as possible, technical or not.”
The ITM wants to avoid human losses, the insurer just losses
In the relationship between insurers and public authorities, approaches can also diverge. Regulators focus above all on the protection of individuals. “For the Labour and Mines Inspectorate [Inspection du travail et des mines or ITM, in French], the main objective is to avoid human loss.” Insurers, on the other hand, have to integrate other dimensions. “We have to consider all the elements we insure, whether it’s property damage or business interruption.”
We do a lot of rebuilding. We rip everything out and rebuild to get something more recent and use the latest standards.
Arriving in Luxembourg also enabled the expert to observe certain specific features of the country. One of these is the frequent renewal of buildings and facilities. “We do a lot of rebuilding. We rip everything out and rebuild to get something more recent and use the latest standards. When you see recent elements and recent standards in the operation of a business, it’s good for prevention.” But it can also create a perverse effect. “Because we’re using the latest technologies, we may think that maintenance is less important.”
Luxembourg also stands out for its hybrid standards environment. The country draws heavily on the rules in force in neighbouring countries. “We have adopted almost everything that is good in the standards of the three neighbouring countries. This situation also reflects the make-up of the workforce. “In the north, customers tend to use German standards because there are more people from Germany. In the south, they tend to use French standards.” While this diversity allows us to benefit from a great deal of good practice, it can also raise questions about consistency. “Stacking good standards doesn’t necessarily make a good overall standard.”
Linguistic diversity is also an issue for prevention. “Not everyone speaks the same language and not everyone has the same culture. In some companies, procedures can be misunderstood. One solution is to use visual management. “Instead of having texts several pages long, we put pictures: good, not good, green, red.”
More and more electrical appliances
A number of recommendations are regularly made during audits. Electrical installations are one of the main causes of accidents. “The majority of fires today are caused by electricity. To prevent these incidents, certain techniques are particularly effective.” Infrared thermography is used to scan electrical installations using a thermal camera. This tool can be used to detect abnormal heating due to contact or tightening faults.
Fire compartmentation is also an essential element. “Fire-stop walls segregate risks.” In a large industrial building, they can considerably limit the extent of a disaster. “It’s better to lose half than all.”
New technologies are also introducing new challenges. Automation and robotisation are leading to more and more equipment running on lithium batteries. “We are bringing a very high level of risk into extremely busy storage areas.” The energy transition is also bringing new challenges. Photovoltaic installations are helping to reduce CO2 emissions, but they can introduce additional risks. “We know today that it can burn and, over time, it burns a lot more.”
We will have more and more data centres and AI tools concentrated in the same place. If it burns down, everything stops.
Despite these tools and methods, risk analysis always involves an element of uncertainty. “Just because you’re an expert doesn’t mean you can see everything.” On very large industrial sites, it is necessary to prioritise observations. “We know in advance that, in certain activities, there are risks that need to be prioritised.” When the risks become too great, the insurer can intervene more firmly. “If the risk starts to affect the human aspect, we’re going to be less about making recommendations and we’ll start to impose things.”
Recent fires also illustrate the evolution of materials and environments. “Today, we have 50% petroleum products in our homes.” These materials burn more quickly than traditional materials. In this context, prevention is above all a question of training and raising awareness. “We need greater prevention reflexes.”
Beyond fires, experts are also observing developments in natural disasters and critical infrastructures. “Flooding is something that needs to be looked at more and more. Digital infrastructures are also a point of vigilance. We will have more and more data centres and artificial intelligence tools concentrated in the same place. If that burns down, everything grinds to a halt.”
