We have been through this before. When I was a new underwriter in 1968 the United States was dealing with protests over racial injustice, the Vietnam War and a bitter election campaign. Now we have added a pandemic and domestic terrorism. Insurers and businesses need to plan and respond.
Kimberly George and Mark Walls discussed the challenges in an "Out Front Ideas" webinar recently. Here are their recommendations on how to minimize losses and keep people safe:
- Employers should prepare by identifying partners in their industry, local government and community. Create a network of advisors to assist in communications. If a firm has multiple locations, management at each site should have the power to make decisions using agreed on procedures.
- Public entities need to protect First Amendment rights while ensuring safety of life and property during protests. Partner with federal, state and other local governments. Police, fire and public transit need to respond appropriately. Communicate with the public.
- Crisis management plans should include quick and appropriate response from senior leaders, incident reports and screening, dealing with escalation, notification and collaboration with stakeholders.
- Review property insurance policies and know what is and is not covered, including deductibles and waiting periods.
- Business continuity plans should include instructions to employees if a location is shut down. Vendors and suppliers should be informed about temporary or replacement locations. If plans are in place before a crisis, restoration should be easier and quicker.
- Employee and community safety should be top priority.
- Perform post-incident reviews to better prepare for the next event.
A historical note: After the riots of 1968, the insurance industry issued a riot exclusion for liability insurance. It was intended for public entities but was indiscriminately applied to almost all insureds. Be prepared for new policy exclusions (possibly aimed at future pandemics) and challenge them if over-reaching or inappropriate.