Learning Through Destruction at FM Global


FM Global’s Research Campus is one of the more interesting things about the insurance industry. Basically, what the company did was build a giant, airplane-hanger-sized warehouse so it would have a place to blow things up. It’s not all fun and pyromania, however. The real value comes from what FM Global observes.

By testing the destructive potential of certain disaster scenarios, the company is able to better understand how building materials, walls, windows, roofs, houses, warehouses and even entire industrial facilities can be fortified to withstand the worst.

It’s all about loss control, really.

For example, the company might do an experiment to find out how much wind it takes to compromise the structural integrity of the Model ABC Roof Flashing sold by XYZ Company if it is installed with 12 half-inch nails. If the wind exposure (both in MPH and duration) that sends the flashing flying is a realistic figure to expect in a certain location (say, Florida) then you now know that it is not the best building material to use if you’re building a tiki restaurant in South Beach. On the other hand, if the flashing does withstand 160 mph winds for 30 minutes, the company now knows it won’t fail in anything but the most catastrophic storm.

Such knowledge is great for the industry at large — it helps all stakeholders learn how building materials hold up in disasters. And the proprietary results are even better for FM Global — they help the company be extremely confident in its underwriting decisions.

Rudd Bosman explains as much in the video below, which complements a new article on the campus that Fortune published in its latest issue. “We spent well over $100 million in capital expense on this facility. It’s absolutely worth it. It’s where we learn what we need to do to prevent losses from happening. That knowledge is invaluable.”

A few years ago, our Editor in Chief Morgan O’Rourke got the chance to tour FM Global’s Research Campus on a day where some serious explosions were taking place.

Outside, it was a quiet, clear January day in the woods of western Rhode Island. But hidden just off the road, in a relatively nondescript structure, I stood in awe some 100 feet away from the largest fire that I had ever seen. A fuel leak had caused a blaze nearly three stories high with flames so intense that the facility’s emergency sprinkler systems were actually making it worse. When the water came in contact with the burning fuel, it caused a reaction much like what happens when water is splashed on a grease fire in the kitchen. Huge fireballs erupted, threatening to engulf the ceiling and the sensitive machinery located there. Even from my distant vantage point, it was very hot and very impressive. It was also a simulation. Welcome to just another day at the office for the scientists and engineers at the FM Global Research Campus.

Check out the rest of Morgan’s feature for more on the most destructive place in insurance.

You can also find more about the campus on FM Global’s website.

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