This year’s National Preparedness Month theme of “Disasters Don’t Wait. Make Your Plan Today” has never been more appropriate. Join the Insurance Institute for Business & Home Safety (IBHS), the Small Business Administration (SBA), and the Insurance Information Institute (Triple-I) during National Preparedness Month for a live webinar on how to prepare for severe weather, COVID-19 interruptions, and other forms of disaster that can have a significant impact on small businesses.
The webinar will showcase small businesses as they share their stories of preparing for and successfully recovering from disaster. In addition to these stories, the webinar will also cover what small business loans are available after a disaster, what tools are available to help businesses prepare, and what you need to know about insurance coverage.
Gail Moraton, CBCP – Business Resiliency Manager at IBHS
Alison Bishop, Internal Operations Manager at Spry Health, Inc. (https://spryhealth.com/)
Alejandro Contreras – Director of the Office of Preparedness, Communication and Coordination in the U.S. Small Business Administration’s (SBA) Office of Disaster Assistance (ODA)
Janice Jucker – Co-Owner at Three Brothers Bakery, Houston, TX – 2018 Phoenix Award Winner for Outstanding Small Business Disaster Recovery (https://3brothersbakery.com/)
Loretta Worters – Vice President, Media Relations at Triple-I
From hurricanes to wildfire, tomorrow’s webinar with IBHS, Triple-I and Small Business Administration will cover all disasters and how you can prepare your business.
With another catastrophic wildfire season again underway in California, join this press conference to hear from fire science and insurance experts on practical steps homeowners and renters can take to reduce their risk from wildfires. Learn where to start and what actions communities need to take first to continue to adapt to wildfire and stay protected.
Register now to join experts from the American Property Casualty Insurance Association, the Triple-I, the Insurance Institute for Business Home and Safety and the National Fire Protection association on September 3, 2020, 10:00 a.m.-11:00 a.m. PT. Register now
The impact of COVID-19 on workers compensation will come down to several fundamental questions in the coming months: Who’s at work? Who’s going back to work? And under what circumstances?
Experts addressed these questions during a webcast jointly sponsored by Triple-I and the National Council on Compensation Insurance (NCCI). The discussion was moderated by Mark Friedlander, director of corporate communications, Triple-I.
While they agreed it’s too early to know all of the impacts of the virus on workers compensation, several important themes are emerging.
Sean Cooper, practice leader and senior actuary, NCCI, said the economy has experienced sudden job losses, compared to the Great Recession of 2008-09, when they were spread out over a period of time, and the nature of those jobs is much different.
“Back then you saw construction and manufacturing impacted greatly, while this time it’s hospitality, leisure and travel,” he said.
Cooper explained some of the varying impacts of COVID-19 on overall workers compensation claims: while COVID-19 claims will have an upward influence on claims, social distancing could put downward pressure on frequency. He also noted telehealth could put downward pressure on the cost of claims.
NCCI files rates and loss costs for every job classification in 38 states, and submits those to regulators for approval in each state. The organization has taken several actions and made several changes to reflect COVID-19.
“We began collecting payroll for furloughed workers so that payroll wouldn’t be used in premium calculations,” said Jeff Eddinger, senior division executive, NCCI. “We are also tracking legislation in each state that affects compensability presumptions.”
Triple-I chief economist Dr. Steven Weisbart pointed out that the last recession was a lengthy one – lasting 19 months – and this one in contrast is unique because it largely depends on a virus and society’s ability to successfully combat it.
Weisbart said he believes the nation will emerge from this pandemic with a different type of economy.
“Telecommuting will be one of the new norms,” he said. “People are recognizing they can do most jobs at home, and companies don’t have the expense of renting office space.”
Weisbart also thinks there will be some additional conversion to robotics and machine jobs, and the number of jobs performed by people may well shrink. He says these types of changes in the workplace will make some difference over time in the types of jobs available and skills required.
Until now, few would have considered a pandemic a likely workers compensation catastrophe. Eddinger noted that traditional methods for calculating the impacts don’t work for low frequency, high severity events.
“NCCI has engaged a modeling firm to evaluate if a pandemic catastrophe provision would be appropriate for future rate filings,” he said. “After 9/11 we applied terrorism models in all 38 of our states, but that was more straightforward because compensability applied to all workers; if you were at work during an event you were covered.”
The Insurance Information Institute (Triple-I) yesterday hosted a webinar showcasing technology companies whose products mitigate the impact of severe weather on homeowners, businesses and communities. This is the first in a series of Lightning Rounds – fast-paced pitch panels for insurance and non-insurance investors.
During the Lightning Rounds, pre-vetted technology companies, equipment suppliers, integrated solution providers, and large-scale project development teams present their unique value propositions.
This Round’s focus was flood prevention. Shelly Klose, CEO of True Flood Risk described the company’s AI-driven risk management platform that provides individual property data, geolocation intelligence and risk scores related to flood risk in real-time without an on-site inspection. Tasha Nielsen Fuller, CEO of FloodFrame USA, presented a system which is installed underground around a structure, and automatically deploys in a flood, protecting the structure. Rahel Abraham, Founder and Chief Executive Officer of ClimaGuard, was inspired to invent a water-resistant wrapping for vehicles and other possessions when her own vehicle was flooded during Hurricane Harvey.
To view a recording of the webinar click on the video above.
Part 1: A view from the C-Suite: Identifying the right technology and risk solutions
Brian Gaab, Strategy & Innovation, CSAA Insurance Group, a AAA Insurer
Susan Holliday, Senior Advisor, International Finance Corporation | The World Bank Group
Matthew T. Schneider, Co-CEO, Aon Risk Solutions, M&A and Transaction Solutions
Michel Leonard, PhD, CBE (Moderator), Senior Economist & Vice President, The Insurance Information Institute
Part 2: Use Cases: Bringing to market flood management solutions
Shelly Klose, Founder and Chief Executive Officer, True Flood Risk
The Resilience Innovation Hub will allow private and public sector entities to collaborate and bring-to-market resilience and flood mitigation technologies. Moreover, the Hub will connect investors with governments and academic institutions while also highlighting pre-disaster mitigation success stories through a resilience portfolio and technology showcase program.
The Innovation Hub is opening effective June 18 at the Cannon’s downtown Houston Cannon Tower, a venue which already houses workspaces where entrepreneurs gather as their ventures develop. The locale, also the headquarters for ResilientH20 Partners, is at 1801 Main Street, Suite 1300, Houston, Texas 77002. The Triple-I’s Resilience Accelerator initiative is aimed at reducing the impact of extreme weather events and building more resilient communities through insurance.
“As households and businesses learn from past natural disasters, especially those which struck the U.S.’s Gulf Coast, the Resilience Innovation Hub can accelerate the deployment of products, services, and projects aimed at reducing disaster-caused losses in consultation with insurance carriers and brokers,” said Dr. Michel Léonard, CBE, Vice President, Senior Economist, Triple-I and the Triple-I’s Resilience Accelerator lead.
“There has been a widespread interest in, and demand for, best-in-class actionable, alternative disaster mitigation solutions since 2017’s Hurricane Harvey and subsequent storms caused extensive insured losses to autos, homes, businesses, and governmental properties,” said Richard Seline, Managing Partner, ResilientH2O Partners. “Society saves six dollars for every dollar spent through mitigation grants funded through federal agencies and even more progress can be made on this front through further investment in pre-disaster risk mitigation.”
“The Cannon Tower will provide a seamless onboarding for the Resilience Innovation Hub’s activities. Houston is already home to networks which focus on issues like sustainability, green infrastructure, and smart cities,” said Remington Tonar, Chief Revenue Officer, The Cannon Startup Platform.
The Resilience Innovation Hub’s creation was announced at the second in a series of virtual Town Halls co-hosted by the Triple-I and ResilientH2O Partners. The session on “Technology, Innovation, and Investment” focused on investing in pre-disaster risk mitigation and featured presentations by:
A panel discussion followed, and it included the Cannon’s Remington Tonar; Aaron Chan, Scouting Manager at State Farm’s @Labs; and Edward Craner, Senior Vice President of Strategy and Marketing at Holt Caterpillar.
A natural disaster will strike no matter where you live in the United States. It’s is not a question of if, but when. But if you’re prepared, the damaging impact of a tornado, flood, earthquake or hurricane can be managed.
Alejandro Contreras, Director of Preparedness, Communication and Coordination at SBA’s Office of Disaster Assistance, advised that communications planning is key to a post-disaster recovery strategy. A list of frequently updated contacts should include local media outlets, utility companies and emergency responders. You should also sign up for alerts from FEMA and local public health officials.
Make sure your records are stored electronically off-site (in the cloud) and make sure you have financial records, insurance policy declaration pages, and important contacts.
When reviewing insurance coverage, don’t forget to explore flood insurance. Flooding is the most common and costly natural disaster in the United States, causing billions in economic losses each year. About 90 percent of all natural disasters in the U.S involve flooding. And just one inch of water can cause up to $25,000 in damage, said Contreras. Flood insurance is sold as a separate policy by the National Flood Insurance Program and a growing number of private companies.
It’s important for a business to create a culture of preparedness and make sure employees understand their roles by frequently testing their business continuity plans, concluded Contreras.
The SBA offers low interest long-term disaster loans to businesses. Since mid-March, the agency has distributed about $86 billion in loans for coronavirus-related losses. To apply for a loan or to learn about the requirement visit disasterloan.sba.gov.
Loretta Worters, Vice President Media Relations, Triple-I, spoke about being financially prepared for disasters with insurance. To be sure the claims process goes smoothly, take a business inventory listing all assets, she advised. It’s also important to have records of expenses and income.
Worters went over the different types of policies available to businesses and what they usually cover. Property insurance helps protect buildings, equipment, furniture, and fixtures. Business interruption insurance (BI) can help with operating expenses during the period of restoration and includes lost net income (based on financial records), mortgage, rent and lease payments, loan payments, taxes, and employee payroll.
A business may have the option to insure its business property at replacement value or actual cash value, she said, noting the difference is that replacement value coverage can help you replace your property at market prices, whereas actual cash value coverage takes depreciation into account. Replacement value coverage costs more, but it also pays out more in the event of a claim so it’s something business should really consider.
BI is also available for civil authority, such as curfews when businesses have to reduce hours due to government orders.
Utilities service endorsement is available to cover disruption in these services to a business premises.
Worters also noted that, as part of BI, extra expense coverage will cover anything beyond the normal day-to-day operating expenses that is necessary to keep a business solvent, such as renting a temporary place of business while your business is insured or leasing equipment.
In response to an attendee’s question, Worters explained that business income losses are determined based on the business’ profit and the cost of continuing normal operations.
Worters concluded that knowing your risks is an essential element of an overall business plan. While large businesses have risk managers to help make insurance decisions, small-business owners must be their own risk manager but can also get help by consulting with an insurance professional.
Make a recovery plan and test it once a year
Gail Moraton, Business Resiliency Manager, IBHS, cautioned that one out of four businesses that close due to a disaster never reopen, yet 57 percent have no disaster recovery plan. Some small businessowners say they don’t have time or money to come up with a business continuity plan or are in denial that a disaster could wipe them out. Easy-to-use plans and checklists are available from DisasterSafety.org.
Moraton also advised that businessowners get familiar with the likelihood and potential severity of the various risks that could threaten their operations. They range from natural disasters to man-made risks, such as cyber attacks, theft, sabotage, war, and loss of key employees, among many others. Owners also should know their operations and gather information by asking staff to list key functions.
She said employees – the most important asset of any business – should be asked to provide their contact information, emergency contacts, and evacuation destinations.
Businesses need to also have a inventory of their equipment and an understanding of their finances.
Moraton said that once you’ve gathered the key information and have a plan you should update and test that plan every year. Running emergency drills annually will make sure everyone is well prepared in case a real disaster strikes.
Know your hazards
Christopher Cioffi, Commercial Line Engineer, IBHS, provided tips on how to review the hazards in your area by checking on previous years’ severe weather events and reviewing FEMA flood maps. He went over the components of the EZ-PREP plan which includes actions to take before, during and after a disaster.
For example, 72 hours before a hurricane, some of the actions the PREP plan calls for include:
Remove or secure all debris on the property
Review message templates for business’ website, phone recording and employee communications
Take laptops home at the end of each day and confirm they can connect to the business’ server from home
On May 14 the Insurance Information Institute (Triple-I), co-hosted a
webinar with ResilientH20 Partners that focused on managing
extreme weather events in the midst of the COVID-19 pandemic. The panelists discussed
the changing role of stakeholders across the private sector, governments and
The panelists drew from their backgrounds across government, business and insurance to discuss the immediate challenges stemming from the COVID-19 pandemic, the downturn in the economy, and near-term flood and storm threats.
the midst of the pandemic, we can’t lose sight of the importance of investing
in mitigation and resilience, which will help on a material level post-event
COVID-19 crisis is putting unprecedented pressure on local governments – if private
investors have ideas for disaster mitigation, especially ones where return on
investment can be shown – now is the time to bring them, and they will be heard
are and will be playing bigger roles in partnering with local governments to
build public/private solutions to disaster resilience
webinar is the first in a new series of thought leadership sessions that aims
to be a catalyst for public-private-partnerships focused on enhancing
pre-disaster risk mitigation at each step of the resilience value-chain, from
financing to development, management, technology selection and
hurricane season starts on Monday, June 1, but could get an early start this weekend with Tropical Storm Arthur.
The insurance industry can meet its obligations to policyholders in the midst of the coronavirus pandemic – but government interventions being discussed threaten to unravel this safety net and could make it impossible for insurers to affordably provide essential coverage in the future.
These are among the conclusions shared by Triple-I chief economist Steven Weisbart and senior economist Michel Léonard in a briefing today that explained how the industry already has been affected by the pandemic and subsequent recession; how policyholder surplus ensures funds are available to cover claims; and how any attempt to retroactively apply this pandemic to business interruption policies would cause irreparable harm to the financial stability of the property-casualty insurance industry.
“Insurers price their policies for expected claims, with additional monies set aside for unexpected claims, such as those which are filed during exceptionally severe hurricane seasons,” Dr. Weisbart said. “The policyholders’ surplus backs up every line of insurance each insurer writes. It is calculated as assets, minus liabilities, and rises and falls due to changes in asset values.”
Dr. Weisbart and Dr. Leonard explained in detail how surplus works and showed how – under a variety of plausible scenarios – retroactively rewriting insurance contracts could make it impossible for insurers to play their critical role as financial first responders.
“If insurers nationwide had to pay business interruption policy claims for which they collected no premium, it could cost the industry each month anywhere from roughly $150 billion to nearly as high as $380 billion,” said Léonard, noting that the smaller amount accounted for the U.S.’s small and medium-size businesses that currently have business interruption coverage and the larger amount includes those who do not. “Pandemic-caused losses are excluded from standard business interruption policies because they impact all businesses, all at the same time.”
The Insurance Information Institute invited its members to a webinar titled “Covid-19’s Impact on Health, the Economy and Growth” on March 5 at 11:00 a.m. EST presented by Triple-I Vice President and Senior Economist Michel Léonard, PhD, CBE.
Dr. Lèonard will discuss the following key points:
• Economic impact likely to continue into Q3/Q4 2020 and 2021 • Could reduce global growth by as much as 1 percent and delay recovery by up to 12 months • Fiscal and monetary policy, rates cuts, unlikely to be effective • Insurance industry to see higher claims, reduced premium growth
He will also preview the Global Macro and Industry Outlook report before it is made available to the public.
To find out more about the benefits of Triple-I membership click here.
In this hour-long live session, part of February Insurance Careers Month, a panel of experts shared insights and best-practices for engaging top young talent from non-RMI backgrounds and optimizing recruitment, onboarding and retention to better contend with emerging disruptive forces (Insurtech, virtual workspaces).