What are Common and Special Hazards?

In the insurance industry, industrial facilities are said to have common hazards and special hazards. Common hazards are those hazards that are found in many facilities regardless of the occupancy or the product being manufactured. Special hazards are hazards that are associated with a specific industry.

For instance, almost all facilities will have electricity. The hazards associated with the power distribution of electricity are considered common hazards because they are common to all industries. Compressed air would be another example of a common hazard because many industries will have air compressors and that compressed air will be used for a number of different purposes.

Special hazards are primarily associated with specific industries. For instance, conducting a proprietary process, which involves combustible materials with an ignition source nearby, may be a special hazard at your facility. Flammable liquids are considered special hazards because they represent a high hazard and they are usually specific to the occupancy of the facility. What may be a common hazard for most industries can become a special hazard in a particular industry. An example may be the use of electricity in a special application. Transformers used for the distribution of electricity under normal voltage and power levels are usually considered a common hazard, but when the voltages or power levels are beyond the normal levels, it then becomes a special hazard. Another example is that of large arc furnaces which use specially designed and built transformers that can withstand the wear and tear from large electrical loads. Arc furnace transformers are typically built to a specific specification and are matched to a specific furnace. Arc furnace transformers can take 12 to 18 months to replace, and would be considered a special hazard.

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