Risk Management


Severe weather at an outdoor festival has proved deadly for the second time in less than a week.

At least five people are reported dead and dozens injured after a stage collapsed in heavy storms during a set by the Smith Westerns at the Pukkelpop Festival in Hasselt, Belgium yesterday.

Rolling Stone reports that this is the fourth major stage collapse incident this summer.

Just last weekend a stage collapsed onto the audience during a storm at the Indiana State Fair just as the band Sugarland was about to take the stage. Six people have died and some two dozen have been injured.

PropertyCasualty360.com has more on the insurance implications of this tragic event.

Earlier in August extreme weather caused a video screen to collapse as the band Flaming Lips was about to take the stage at Tulsa’s Brady Block Party in Oklahoma, and in July the stage collapsed from beneath the band Cheap Trick at the Ottawa Bluesfest in Canada during a severe windstorm.

These events underscore the importance of safety and risk management when it comes to outdoor events, such as concerts, festivals and fairs.

An Associated Press article via CSI Special Event Insurance notes that concert events have increased in size and scale, becoming more elaborate and often involving tons of lighting and video equipment.

AP also notes that there are no standard safety regulations for outdoor events.

Special events insurance can provide a range of coverages such as event cancellation, bodily injury, venue liability and workers’ compensation. Coverage can be tailored for a specific event to meet the risks involved.

Areas on the edges of tornadoes could see reduced property damage and dramatic improvements in safety by using better design and construction methods, according to a new study on the April 27 Tuscaloosa tornado by engineers at the University of Alabama and academic researchers at universities across the country.

Insurance Journal reports that based on the study findings, relatively minor changes in construction, such as better shingles, more anchors and thicker vinyl siding, could have prevented much of the damage to homes caused by the April 27 EF-4 Tuscaloosa tornado.

Insurers expect to pay out around $2 billion on claims from tornado damage in the Birmingham and Tuscaloosa areas alone, according to the I.I.I.

Researcher Andy Graettinger of the University of Alabama told Insurance Journal that homeowners on the fringes of the tornado would have been spared at least some damage with different construction methods or improvements to existing homes.

In some cases, homes could have been saved from catastrophic damage by metal clips or straps that cost about $1 each:

You’re looking at a few thousand dollars for these clips that hold everything together. It’s a very small amount compared to the cost of the house.”

Key takeaways from the study include:

  1. Light-frame wood buildings do not, and will not, have the ability to resist EF4 or EF5 tornadoes. The level of damage to light-frame buildings at lower wind speeds is not acceptable and can be reduced through new engineering design and construction practices.
  2. Virtually all buildings in the path of a strong tornado, even along the outer edges where wind speeds are lower, are irreparable based on current design and construction practices. This provides incentive and an opportunity for tornado-resistant design and construction practices which currently do not exist, according to the researchers.
  3. Interior closets and bathrooms provide shelter at lower wind speeds on the edges of the tornado, but they were no guarantee of survival. The concept of a “safe spot” should still be taught, but a safe spot is not a substitute for a safe room or tornado shelter.

Download a copy of the Tuscaloosa Tornado Report here.

Check out I.I.I. facts and stats on tornadoes.

The problem of school bullying was the subject of a recent post here at Terms + Conditions. In it we noted that with increased access to and use of technology, cyberbullying is a growing concern.

An article in the New York Times over the weekend reports that as bullies go digital, parents are struggling to know the best way to respond. As the NYT states:

It is difficult enough to support one’s child through a siege of schoolyard bullying. But the lawlessness of the Internet, its potential for casual, breathtaking cruelty, and its capacity to cloak a bully’s identity all present slippery new challenges to this transitional generation of analog parents.”

According to the NYT, it’s not just about parents being technologically a step behind or failing to acknowledge the issue. Many struggle with how to supervise their children’s’ Internet activities, and how to proceed in the event their child is the victim of an attack.

Part of the problem is also that schools may be reluctant to get involved when the behavior occurs off-campus, and going the law enforcement route may involve a protracted process.

What about the legal environment? According to the Cyberbullying Research Center, at last count 44 states had laws regarding bullying, and 30 of those included some mention of electronic forms of harassment. Almost all of these laws direct school districts to have a bullying and harassment policy, though few delineate the actual content of such policies.

The Center advises educators, parents and law enforcement officers to carefully review and understand the statutes in their own state to understand the formal legal implications of participating in cyberbullying.

Check out the Center’s fact sheet on cyberbullying: identification, prevention and response.

Holiday shopping season is almost upon us. A week from today is Cyber Monday which along with Black Friday — the day after Thanksgiving, are the most popular days to shop for the holidays.

Shopping online may be easier than braving the crowds of the mall, but it’s important to make sure that convenience doesn’t come at the price of your identity.

An annual survey by internet security firm Webroot of more than 2,660 individuals in the U.S., UK and Australia, found that some of consumers’ online habits – including using search engines and public WiFi for online gift buying – may put them at risk.

It also found that one in seven respondents has already become a victim of credit, debit or PayPal account fraud this year.

In addition, 57 percent received phishing emails from bogus sources claiming to be a legitimate company – a risk that increases around Black Friday and Cyber Monday.

Fortunately some online shoppers appear to be growing more vigilant.

A separate poll by the National Cyber Security Alliance (NCSA) found that the majority of Americans (64 percent) report they have not made an online purchase from a specific website because of security concerns.

When asked to explain why they did not make that purchase, 60 percent said it was because they were not sure if the site was secure, 51.4 percent were worried about providing information requested, and 48.4 percent felt a website more requested more information than was necessary for the transaction.

What about insurance? The good news is that identity theft may be covered by insurance. Some homeowners and auto policies include identity theft protection and resolution services at no additional cost.

Check out I.I.I. facts and stats on identity theft and tips for avoiding identity theft.

The problem of school bullying has become a hot topic in recent weeks after a number of high profile cases of young people committing suicide after bullying incidents.

In 2007, about 32 percent of students ages 12-18 reported having been bullied at school during the school year, according to a school crime survey from the National Center for Education Statistics.

Bullying generally is defined as an attack or intimidation with the intention to cause fear, distress or harm by an individual or group usually repeated over time that involves an imbalance of power. The act of bullying can take various forms, including physical, verbal and psychological acts.

With increased access to and use of technology, cyberbullying is a growing concern. Cyberbullying has been defined as an aggressive, intentional act by an individual or group using electronic forms of contact, repeatedly over time against a victim who cannot easily defend him or herself.

The beginning of a new school year reminds us of the everyday risks that school-age children face and in turn the growing liability exposure facing parents and schools.

For example, a recent Chubb survey of parents of school-age children found that more than two-thirds (67 percent) agreed that today’s kids are exposed to more risks than they encountered during their own childhoods.

However, the same study revealed that parents tend to focus on severe but rare incidents, rather than everyday risks like bullying.

Some 38 percent ranked kidnapping/abduction as the “traditional” risk that concerns them the most, above car accidents (30 percent) and harassment/bullying (22 percent).

For technology-related hazards, parents listed online predators as the top threat (38 percent), followed by identity theft (25 percent), cyberbullying (18 percent) and sexting (14 percent).

It’s not just parents that are dealing with how to manage this risk. School districts increasingly are facing lawsuits due to their alleged failure to take action when notified of bullying incidents.

The National Conference of State Legislatures (NCSL) notes that since 2001, more than half the states have enacted legislation to combat bullying. But NCSL also observes that state policies vary widely in how they address bullying.

A new student risk guide by Chubb offers tips on back-to-school safety and helps parents protect their kids against these risks.

The Public Entity Risk Institute (PERI) lists the numerous Web resources available for training and information on combating bullying and school violence.

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