Tuesday, May 14, 2019

From the P&C Files: Active Shooter Insurance

So as one might imagine, this has become something of a hot topic of late. I knew we should blog on it (for all the obvious reasons), and since it's in the P&C world, I wanted to be sure that I had a firm grasp on as many of the issues as possible.

To that end, I turned to my colleague Teresa S, and we had a nice (long) chat trying to identify those issues (as best we could).

Beyond the obvious (wrongful death and medical and funeral expenses), there's counseling, biohazard cleanup, and destruction of property; in some cases, relocation and rebuilding expenses might also come into play. There's also business interruption and even Public Relations, and let's not forget off-site coverage (if the business or organization needs to rent temporary facilities).
This is not, of course, an exhaustive list.

Who and what, exactly, are being insured is also important: the institution/organization, of course, but also boards of directors, Elders, etc.

And who's eligible for coverage becomes an issue: members or students, of course, but what about guests or employees?

Generally speaking, commercial liability policies will have a list of exclusions; items not on this list are then usually covered. Typical exclusions might include acts of war and/or terror, or even more specifically mass casualty events. Which latter begs the question: what does mass casualty mean?

[ed: Turns out that, much like Tootsie Pops, the magic number is 3]

The folks at World Wide Facilities sent along a very helpful guide to their program, which includes some nice features. One thing that Teresa pointed out was that regardless of whether or not one's current commercial liability insurer even offers this coverage, it may be worth considering this kind of stand-alone plan in addition to or instead of adding coverage to the current plan. 

And, of course, what kinds of establishments might be looking for this coverage (or, maybe more critically, should be considering)? That would include:

Schools                                          Hotels
Religious Organizations                Restaurants and Bars
Hospitals                                       Sports/Recreation/Entertainment venues
Municipalities                                Events and Concerts


Coverage limits are generally measured in the millions (or even tens of millions). One thing I liked about World Wide's brochure was that the application itself provides a great deal of helpful hints about what to be considering:

■ Is there an on-site security detail?
■ How far away is the nearest police and/or fire department?
■ Is there an emergency preparedness plan in place, and who knows what it is (or even knows that it exists)?
■  Are there regular security drills?

And more.

The bottom line, of course, is that it's a lot easier (and more cost effective) to consider these issues and this coverage before an incident. As usual, we recommend speaking with your own agent to determine what coverage (if any) is already in place, and what's missing.
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