Warehouse fires are not frequent, but when they happen the losses are large. Storage buildings hold a lot of fuel in a small footprint, often with few people present to notice a fire early. Most of the protection comes from three things: keeping ignition sources under control, keeping storage within what the sprinkler system was designed for, and keeping people able to get out. This guide covers each, plus the coverage questions that follow.

What the fire data shows

The National Fire Protection Association's 2025 research report on warehouse structure fires, covering 2018 through 2022, found:

1,508Warehouse structure fires per year, on average
$323MAverage annual direct property damage
72%Share of that damage from fires starting in storage areas
  • Storage areas were the leading area of origin, accounting for 38% of fires and 72% of direct property damage.
  • Heat from operating equipment was the leading heat source, involved in 44% of fires; arcing from operating equipment accounted for 14%.
  • Electrical distribution and lighting equipment, and shop tools and industrial equipment, were each involved in 19% of fires.
  • Misuse of materials or products was a contributing factor in 24% of fires.

The pattern is clear: equipment and electrical sources start many fires, and the stored goods determine how large they become.

Control ignition sources

  • Electrical. Have a qualified electrician inspect panels, connections and lighting periodically; infrared scanning of electrical equipment finds hot spots before they fail. Keep panels clear and covered, and do not use extension cords as permanent wiring. See electrical safety.
  • Lift trucks and charging. Charge batteries in a designated, ventilated area away from stored combustibles, keep it free of smoking and open flames, and inspect chargers and cables. Lithium-ion batteries, whether in equipment or stored as product, deserve specific attention; ask your fire marshal and insurer about storage and charging arrangements.
  • Hot work. Use a written hot work permit for welding, cutting and grinding, with combustibles cleared or covered, a fire watch during the work and for a period afterward, and extinguishers at hand.
  • Housekeeping. Remove empty pallets, stretch wrap, cardboard and dust on a schedule. Idle pallets, especially plastic ones, add a large fuel load and are best stored outside or in a protected area.
  • Smoking. Designate outdoor smoking areas well away from docks, trailers and pallet stacks, with proper receptacles.
  • Equipment maintenance. Conveyors, compactors, balers and heaters all produce heat and friction. Keep them on a preventive maintenance schedule.

Keep storage within the sprinkler design

A warehouse sprinkler system is designed for a specific combination of commodity, packaging, storage method and height. When those change, the system may no longer be adequate, even though nothing about the sprinklers themselves has changed.

ChangeWhy it matters
New products or packagingCommodity classification under the International Fire Code and NFPA 13 depends on the product and its packaging. A noncombustible product packed in foam or expanded plastic can move into a more demanding class.
Higher storageThe International Fire Code treats combustible storage over 12 feet high as high-piled storage, with added requirements; for certain high-hazard commodities the fire code official may apply them above 6 feet.
PlasticsNFPA 13 applies storage criteria to Group A plastics at lower heights than ordinary commodities.
New racks or mezzaninesRacks can obstruct ceiling sprinklers and may require in-rack sprinklers. Changes typically need a permit and engineering review.

Keep 18 inches clear below sprinklers

OSHA's sprinkler standard requires at least 18 inches of vertical clearance between sprinkler deflectors and the top of storage. OSHA interprets this as a horizontal plane across the whole storage area, not just directly under each head, so sprinkler discharge can spread and pre-wet nearby combustibles. Some high-challenge storage needs more.

Also keep rack flue spaces open, avoid blocking sprinkler control valves, and have the system inspected, tested and maintained on the schedule your fire code and insurer require. If you are planning to store something new or rack higher, talk to a fire protection engineer and your broker before the goods arrive. Our article on pallet rack safety covers rack inspection and load limits.

Manage sprinkler impairments

Many large warehouse losses happen while protection is out of service: a valve closed for a tenant improvement, a system drained for a repair, or an alarm disconnected during a contractor's work. A short impairment procedure reduces that window:

  1. Plan the shutdown. Schedule work so the system is out of service for the shortest possible time, and have parts and crews ready before the valve is closed.
  2. Notify the right people. Tell your monitoring company, the fire department if your jurisdiction requires it, and your insurer through your broker.
  3. Tag the valve. Use an impairment tag on any closed valve so no one leaves it shut by mistake.
  4. Add precautions. Stop hot work and other high-risk activity in the affected area, post a fire watch if required, and keep extra extinguishers available.
  5. Restore and test. When work is complete, reopen valves fully, perform a main drain test, confirm signals at the monitoring station, and remove the tag.

Detection, extinguishers and egress

  1. Monitored alarms. Sprinkler waterflow and valve supervision should report to a monitoring station, so a fire or a closed valve gets attention when the building is empty.
  2. Portable extinguishers. Where employees are expected to use them, OSHA requires portable extinguishers to be visually inspected monthly, and they must be maintained and kept accessible.
  3. Exit routes. OSHA requires that employees can open exit route doors from the inside at all times without keys, tools or special knowledge. Keep aisles to exits clear, marked and lit.
  4. Emergency action plan. Train employees on alarms, evacuation routes, assembly points and who calls 911. Drill it. See emergency preparedness.

Fire protection and means of egress are both on the list of hazards OSHA inspectors examine under its revised warehousing National Emphasis Program, which took effect July 31, 2026.

A monthly fire walk-through

  • Storage at least 18 inches below sprinkler deflectors throughout
  • Rack flue spaces open; no storage on top of racks beyond design height
  • Sprinkler control valves open, accessible and supervised
  • Extinguishers in place, charged, inspected and unobstructed
  • Exit doors unlocked from inside, signs lit, aisles clear
  • Electrical panels clear; no damaged cords or overloaded outlets
  • Battery charging area clean, ventilated and clear of combustibles
  • Idle pallets and trash removed or stored in the designated area
  • Hot work permits closed out and fire watches completed

Our fire prevention for manufacturing article and warehouse safety inspections guide expand on inspection routines.

How insurance typically responds

Coverage depends on your policy forms, limits and conditions, but in general:

  • Commercial property covers fire damage to the building, equipment and your own stock. Valuation and coinsurance terms decide how much is paid, so values need to keep pace with inventory and construction costs.
  • Business income and extra expense covers lost income and added costs while you rebuild or relocate. Large warehouse losses can take many months to restore.
  • Customers' goods stored in your building are typically not covered by your own property policy. Warehouse legal liability responds when you are legally liable for their loss; your contracts and warehouse receipts shape that liability.
  • Protection conditions. Some policies make coverage conditional on maintaining sprinklers or alarms. If a system is impaired or shut down, tell your insurer through your broker and follow the impairment procedures.

Our warehouse insurance page describes how these fit together.

When to call a broker

Call us before you change commodities, packaging or storage height, add racks or a mezzanine, take on a customer's goods under a new contract, or shut down a sprinkler or alarm system for work. We can coordinate with your insurer's loss control team and help make sure your property values and business income limits reflect what a fire would actually cost.

Sources