Author Archives: Emily Holbrook

About Emily Holbrook

Emily Holbrook is a former editor of the Risk Management Monitor and Risk Management magazine. You can read more of her writing at EmilyHolbrook.com.
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July/August Issue of Risk Management Now Online

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Faithful readers: the June issue of Risk Management magazine is now online. The cover story focuses on how rating agencies gained so much power, helped tank the economy and figure into the future of risk management. Other features explore a possible turn in the property/casualty insurance market cycle and Risk Management‘s 7th annual captive domicile review.

Our columns explore topics such as:

If you enjoy what you seen online, you can subscribe to the print edition to enjoy even more content.

Please let us know what you think in the comments below. And stay tuned to the blog for even more coverage in the future. Lastly, you can follow the magazine on Twitter, “like” us on Facebook and join our LinkedIn group.

Lloyd’s Could Lose $15 Million from Tour Cancellation

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Lead singer and vocalist Caleb Followill -- exhaustion or alcohol?

When the band Kings of Leon scheduled their international tour, they covered the far flung possibility of event cancellation with Lloyd’s of London, taking out a $15 million policy, according to Rolling Stone. And now, Lloyd’s may have to pay up.

At a Dallas, Texas, show just a few days ago, lead singer Caleb Followill announced mid-concert that he could not finish the show. In his own words, he was drunk and needed to leave to stage. The rest of the band members (consisting of two brothers and one cousin) apologized to the booing crowd. But those weren’t the only people to be upset and maddened by the lead singer’s actions.

Three days later the band cancelled their remaining 29-city American tour, citing Followill’s “vocal issues and exhaustion,” though it had been long rumored that he struggled with a serious drinking problem. And his bandmate’s statement on Twitter that read “I can’t lie. There are problems in our band bigger than not drinking enough Gatorade” did not help quell suspicions. From PropertyCasualty360.com:

“If he is truly sick, he’ll probably need a doctor to medically diagnose him,” says Paul Bassman, president of Doodson Insurance brokerage, the U.S. arm of U.K.-based Doodson Broking Group.

Though this is the most recent case of event cancellation, it is most definitely not the only instance. Big-name artists such as Mariah Carey, Britney Spears and Billy Joel have cancelled all or some of their tours due to various excuses, whether true or false. And in June, Lloyd’s filed a lawsuit requesting to nullify a policy it had with promoters of Michael Jackson’s canceled comeback tour.

Taking steps to insure an event or tour is a smart move for artists and promoters, but a sometimes risky and costly one for insurers.

For more on concert and festival risk, check out the June issue of Risk Management.

When Working From Home Turns Deadly

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Cathleen Renner had a desk job that resulted in an inactive lifestyle (I think most of us can relate). After 25 years with AT&T, however, the obese Renner died of a blood clot right there at her desk after a 10-hour work shift at her home office. Even more unusual, a New Jersey appellate court ruled that Renner’s husband was entitled to workers compensation benefits. How?

AT&T contended that Renner’s work was no more a threat to her health than her day-to-day lifestyle, the ruling states. The company also said many factors besides her work contributed to her death. A lawyer for AT&T did not return a message seeking comment. Dr. Leon Waller, who testified on behalf of the 47-year-old Renner, acknowledged the mother of three had other risk factors like obesity and the use of birth control pills, the ruling states. But Waller found that Renner’s clot developed while she was working.

The court found that although Renner led a sedentary life both inside and outside of work, evidence showed that her work inactivity was greater than her non-work inactivity.

This is a first of its kind for workers comp cases. But will it have an effect on on future workers comp cases of the same nature? “I could see another judge with those same factual circumstances deciding otherwise,” said Gerald Rotella, chairman of the workers’ compensation committee for the New Jersey State Bar Association.

Working from home has become popular in today’s workforce; it boosts employee morale, cuts down transportation costs and in some instances, increases employee productivity as a result of diminished distractions. But what happens when an employee takes on too much without the supervision of a manager? Though a lethal outcome is rare, other health risks could easily surface.

How do you keep an eye on those working from home?

Wall Street Uses Risk Management?

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In attempting to describe the behavior on Wall Street in recent years, the term “risk management” probably won’t be near the top of anyone’s list. But when it comes to the nearing possibility of the United States defaulting on its debt, Wall Street embraces risk management with a passion.

Right now, the Federal Reserve is preparing for the possibility of default if the August 2 deadline for raising the government’s $14.3 trillion borrowing limit is not met. All signs (and common sense sprinkled with a bit of optimism) point to President Barack Obama and Congress finding an agreement to increase the Treasury’s borrowing authority in time to avert a default. If not, the world’s biggest economy faces rating agency downgrades and runs out of cash — soon.

To prepare for that possibility, financial players are “taking steps to reduce the risk of holding Treasury bonds or angling for ways to make profits from any possible upheaval. And even if a deal is reached in Washington, some in the industry fear that the dickering has already harmed the country’s market credibility.”

The rating agencies, which control the fateful decision of whether the nation deserves to have its credit standing downgraded, are surveying other entities that would be affected by a United States default — like insurance companies and states — and issuing warnings that a United States downgrade could result in several other ratings cuts. States that might be downgraded, in turn, are trying to reassure the market that they could still pay their bills on time.

Some say bond traders are optimistic, however — thinking there’s no way the House Republicans will blow the August 2nd deadline. But just in case, they’ve got a plan.

Now that’s some Wall Street risk management.