Calculating Fire Loss on NFIRS Forms
Posted: Nov. 2, 2016
Updated: May 6, 2024
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This NFIRSGram explains how to calculate fire loss to accurately document a fire incident in the National Fire Incident Reporting System (NFIRS).
Definition of fire loss
Fire loss is an estimation of the total loss to the property and contents, in terms of the cost of replacement in like kind and quantity. This estimation of fire loss includes contents damaged by fire, smoke, water, and overhaul. It does not include indirect loss, such as business interruption. Therefore, total fire loss is the sum of the Property Loss and Contents Loss fields reported in section G2 of the NFIRS Basic Module.
The pre-incident values are an estimation of the replacement cost of the property and contents.
Subtracting the loss from the pre-incident value can show how much of the property involved in the incident was saved thanks to fire department intervention, which in turn informs community risk reduction efforts.
How to calculate property value and loss
To calculate property loss, both the property value and the percent of loss must be determined. One way to calculate the pre-incident property value is to use publicly-available resources to determine how much a property is worth. The following International Code Council’s (ICC) Building Valuation Data (BVD) formula provides the “average” construction costs per square foot, which can be used to determine the estimated value of a building:
total square footage x square foot construction cost
For instance, a 1,200 square foot home would return an estimated value of 1,200 x $140.33 (cost per square foot of IIIA construction for R3 one- or two-family residences) = $168,396. All calculations presented in this NFIRSGram are meant to be used as examples and were performed using an ICC BVD guide dated August 2020.1 However, there are other options for determining the value of a property, such as using other loss calculators or looking up the property value on a tax assessor’s website.
To determine the amount of property loss, multiply the pre-incident value by the percent of the property damaged by fire, smoke, water, and fire suppression efforts. For example, if 50% of the home was damaged during the incident, multiply the pre-incident value by 50% to calculate the property loss:
pre-incident value x percent of property damaged
$168,396 X 50% = $84,198
It is not expected that an occupant will return to a home that is 50% damaged; it is possible that the entire home will be documented by insurance as a “total loss.” However, by showing that the fire department controlled the spread of the fire to 50% of the building, the fire department’s actions on scene were effective by saving some of the property.
How to calculate contents value and loss
Contents value and loss can be documented separately from property value and loss if there is no damage to the exterior or structure of the property but rather the interior of the property. For example, a stove may be damaged in a cooking fire without damage to the house. The pre-incident value and monetary loss of the stove would be documented for the contents. The pre-incident property value of the home would be the current value of the home, and the property loss would be “None” or zero (0).
Documenting fire loss
When a fire occurs, enter the best estimate of the loss for the property and any contents, as well as the estimated pre-incident values. Monetary losses should be estimated as accurately as possible, though it is understood that estimates may in fact be rough approximations based upon current values in your jurisdiction. Other entities documenting property value and loss, such as insurance carriers, will use their own formulas to calculate value and loss. Therefore, they will not need to rely on incident documentation. Fire departments, however, should use a standard method to estimate the value and loss of property and contents involved in a fire to assist with their community risk reduction efforts. Your local jurisdiction may have real estate assessment data available that can be used to estimate loss and value.
With a fire incident, if a loss to an adjacent property (damage due to water, heat, smoke or fire control, not fire) is encountered, then this loss should be documented in the remarks field (section L of the NFIRS Basic Module) of the original incident report. The damage to the adjacent property (non-fire damage) would not be a fire exposure, since only fire exposures are reported in NFIRS.
Clicking “None” versus leaving the fields blank
When a value is unknown, it is preferable to leave the fields blank. Clicking the “None” box means that there was no loss at all ($0), whereas leaving the fields blank means that you do not know the value of the loss.
Key points for calculating fire loss
- Fire loss is an estimation of the total loss to the property and contents, in terms of the cost of replacement in like kind and quantity. Total fire loss is the sum of the Property Loss and Contents Loss fields reported in section G2 of the NFIRS Basic Module.
- Fire loss includes contents damaged by fire, smoke, water and overhaul.
- Subtracting the loss from the pre-incident value can show how much of the property involved in the incident was saved thanks to fire department intervention, which in turn informs community risk reduction efforts.
- When a value is unknown, it is preferable to leave the fields blank. Clicking the “None” box means that there was no loss at all ($0).
- Only use whole dollar amounts and do not include cents when entering property and contents losses and pre-incident values.
- The BVD formula can be accessed at Building Valuation Data - ICC (iccsafe.org) by registering for a free account.
For more information about NFIRS, please contact the NFIRS Support Center: Monday – Friday between 8 a.m. – 4:30 p.m. ET, at 888-382-3827 or by email at fema-nfirshelp@fema.dhs.gov.