How adopting the International Existing Building Code will affect claims and adjusting costs
Historically, California has operated under the Uniform Building Code as modified by the state and adopted as the “California Building Code,” then adopted by local municipalities. Now, the International Building Code is scheduled to become the model code for California, and adoption of the International Existing Building Code is being discussed.
In recent decades, the CBC has permitted repair of existing buildings without requiring structural upgrading and without invocation of quantitative upgrade triggers. The CBC regulated repairs primarily by requiring that repairs not make an existing building less safe than it was previously, thus effectively “grandfathering” in the undamaged portions of existing buildings. In California, only a few communities had adopted specific triggers that occasionally led to upgrading of undamaged portions of existing structures; e.g., Los Angeles had cost-of-repair-based triggers, and San Francisco has a loss of strength threshold. Now however, specific regulations governing “repair” have been stricken from the IBC. Once adopted, the IEBC is expected to govern how buildings will be repaired.
Devil in the details?
With the move to the International family of codes, existing building structures will be addressed by the IEBC. While the code describes itself as providing for flexibility, the IEBC actually sets forth a prescriptive set of repair guidelines that requires detailed engineering evaluation studies of all damaged buildings to determine whether certain loss-of-capacity-based damage thresholds have been exceeded. If so, the code requires that entire buildings, both damaged and undamaged portions, be structurally upgraded, thus taking away all flexibility. This is problematic given the variety of impacts created by fortuitous insurance losses, as opposed to the more optional remodel/expansion alternatives.
Even more problematic is that while the IEBC is prescriptive with respect to the establishment of triggers and on the requirements to upgrade if the triggers are exceeded, the code is silent on how “loss-of-capacity” is determined. Thus, the key computations upon which the decision to upgrade or not-upgrade are left to the discretion of the engineer and local building officials. There is no code-recommended methodology for computing loss-of-capacity, and few or no published methodologies for guidance.
This shift is unprecedented and is clearly a recipe for protracted disputes to arise. Moreover, for older existing buildings without available engineering drawings, the costs of developing sufficient structural data to attempt to make this required calculation will likely be enormous.
Claims adjusters have traditionally had to contend with overzealous architects/engineers specifying optional upgrades that are in excess of the minimum code requirements and/or public adjusters promoting interpretations in excess of the minimum code into the approval of submitted repair plans before the building official. City or county building officials are typically happy to accept over-designed stratagems for repair. They will rarely, if ever, advise the submitter to consider more cost-effective or less extreme methods of repair.
Adjusters have frequently requested to review design drawings or plans for repairs prior to submittal to building officials. And on larger losses, they have retained engineers and building consultants to provide input into the design process. However, those methods are not always successful in averting excessive repairs.
Another available option for addressing building repairs is to submit plans developed by consultants of insurers to the building official for approval to help ascertain the minimum code threshold. However, this is not typically done for a number of reasons, including the appearance of having two engineers-of-record for the same project, insurers appearing to mandate repairs for the insured, etc. Another approach is to bring in an outside member of the community of building code officials after approval. This person serves as a private consultant to confront the local building official about what may be a more moderate, but yet acceptable, design under the prevailing code. While these approaches sometimes work, more often they do not.
The IEBC will make the historically difficult situation worse because exceedance of the loss-of-capacity threshold is extremely difficult to define, and the discretion of the building official is vastly increased.
Increase in cost to adjust claims?
With the adoption of the IEBC and IBC by California, you can expect to see loss adjustments expense greatly escalate, as the costs of countering excessive repairs will require more competent structural engineers and code consultants to bring proposed excesses back to the minimum standard necessary to satisfy the minimum code “language” the coverage granted by the typical code coverage endorsement, or strong consideration of more limited extensions of code coverage grants.
While California has thus far scheduled adoption of an Appendix chapter of the IEBC, the document has not yet been adopted in its entirety. Given the stated desire of many influential groups in the state, including associations of structural engineers and building officials, the elimination of repair criteria from the IBC, and the preeminence of the International family of codes, it will not be long until the IEBC hits California in a big and perhaps unanticipated way.
Mark Sturgess is an assistant vice president in the San Francisco office of McLarens Young International. Terrence Paret, a senior consultant at the Emeryville, Calif., office of Wiss, Janney, Elstner Associates Inc., also contributed to this article.