Along with January renewals and analyzing whether existing policies offer sufficient coverage, the new year is a perfect reminder to review company-wide emergency plans. While 2013 may have been a relatively light year for catastrophe losses, there’s no reason to assume 2014 will be, too.
Check out this infographic from Boston University’s Masters in Specialty Management program for a jump-start on identifying the risks of natural disaster and updating plans for how to handle any emergency:
Weather damage never goes out of season. According to a new report from the Insurance Information Institute (I.I.I.), winter storms are historically the third-largest cause of catastrophe losses, behind only hurricanes and tornadoes.
“Winter storms accounted for 7.
1 percent of all insured catastrophe losses between 1993 and 2012, placing it third behind hurricanes and tropical storms (40 percent) and tornadoes (36 percent) as the costliest natural disasters,” said I.I.I. President Robert Hartwig.
Between 1993 and 2012, winter storms resulted in about $27.8 billion in insured losses—or $1.4 billion per year, on average, according to Property Claims Service for Verisk Insurance Solutions.
A December ice storm in North Texas left at least $30 million in residential insured losses in its wake, the Insurance Council of Texas reported. This figure does not include estimated damage to vehicles or government property, nor does it take into account the significant municipal expense of safety or cleanup measures. Dallas County alone spent 0,000 to 0,000 just to battle slick roads, according to conservative estimates from County Judge Clay Jenkins.
He told Insurance Journal that, while sanding and salting roads constituted some of the county’s greatest efforts, the biggest cost came from closing offices, including the court system. Weather-related shutdown resulted in lost productivity of about .
5 million, he said.
Nation-wide, December weather caused total economic and insured losses estimated in the hundreds of millions of dollars and claimed 29 lives, Aon Benfield reported.
But 2013 should have made some fair-weather friends in the insurance industry. Last year, according to Munich Re, direct overall losses caused by global disasters amounted to around $125 billion and insured losses of around $31 billion. While exceptionally costly, these were below the 10-year averages of $184 billion and $56 billion, respectively.
Who knew A Christmas Story was so full of dangerous and costly risks? Think about it. A “double dog-dare” could have led to a disasterous school yard injury and we all know what can happen when kids play with BB guns.
Lockton, which recognized the huge risks involved, has published a white paper examining these and other risks in the classic movie. They have even gone a step further, outlining the potential costs of coverage.
For example, consider this: unsupervised children left to amuse themselves on an icy cold playground.
“Winter is filled with fun, but also dangerous with recess activities like snowball fights and playing tag on icy blacktops. Even with the best of intentions, some injuries are unavoidable and parents are bound to hold the school liable,” according to the report, Ralphie’s Risk Management Story: An Insurance Perspective on the Holiday Classic, “A Christmas Story.” Cost of insurance for this risk? A policy with limits of ,000 for each individual—with a premium cost of 0.
And who could forget the “priceless” leg lamp, won through a newspaper sweepstakes, but broken during a “vacuuming accident?” In this scenario it’s Lloyd’s to the rescue with $1 million in coverage and a premium of $5,000.
But wait, there’s more. The paper looks at exposures including shipment of Ralphie Parker’s pink bunny suit; workers compensation for employees of the Chop Suey Palace—where a worker cuts his finger preparing the Parkers’ Christmas dinner; the Parker home and automobile risks; Santa’s infamous slide at Higbee’s Department Store; and the risks of a Red Ryder BB gun misfire. Now that’s a lot of risk, but fortunately, all manageable.
Happy Holidays!
Photo: eddtoro/Shutterstock.com
At 7:20 a.m., Dec. 1, four people died and more than 68 were injured, 11 critically, when a speeding passenger train headed for Grand Central Terminal derailed on a steep curve.
Brake failure was cited as a possible reason for the crash, but inspections determined that the brakes were in good condition. The train’s operator, who recently had been switched to an early shift, later said he may have dozed off, failing to apply the brakes in time to avoid the crash.
The derailment is of special interest to me. The Hudson line is the one I take to work every day and is the same line that suspended service in July when 10 CSX garbage cars derailed near the same location, just north of the Spuyten Duyvil train station.
This week the Federal Railroad Administration cited the MTA’s safety record as “unacceptable.” The agency noted a series of other recent major accidents on the commuter railway: a two-train derailment May 17 in Bridgeport, Conn., where more than 70 people were injured, the death of a track worker in West Haven, Conn., who was struck by a commuter train, and the CSX train derailment, according to DNAinfo New York.
The Associated Press said that injuries from train accidents on Metro-North are higher this year than any of the past 10 years, with 123 people injured in train accidents through August. A 2012 report by the Government Accountability Office found human error to be the cause of almost one-third of train accidents from 2000 to 2009.
The question being asked is why a safety measure—an automated system that would stop a train that is out of control—was not in place, even though “positive train control” has been called for by the national safety board. In response to several fatal accidents and to combat human error, The Rail Safety Improvement Act of 2008 mandates that positive train control for passenger and freight trains be operational by Jan. 1, 2015. Because of the costs to install the technology, estimated between $6 billion and $22 billion, however, Congress is considering an extension of the deadline until late 2018.
The GAO report described positive train control as a system designed to prevent accidents caused by human factors, including train-to-train collisions and derailments that result from trains exceeding safe speeds. It is also designed to prevent incursions into work zones and movement of trains through switches left in the wrong position.
While its safety record leaves much to be desired, the MTA was fast to resurrect its contingency plans. On Monday, thousands of commuters were transported by bus from the Yonkers train station to a Manhattan-bound subway. I made the trip, which was seamless but understandably slow-going. It took me two-and-a-half hours to get to work.
A standout were the first responders. They were fast to arrive on the scene, rescuing people from damaged cars and getting them to area hospitals. Responders and spokespeople were articulate, and did not speculate as to the cause of the crash. They were impressive.
As of yesterday service on the Hudson Line is fully restored.
This is an amazing feat considering that the train cars had to be removed by cranes from a tight section of track flanked by the Hudson River and a steep rock embankment, all during an intense investigation. Sections of damaged track also had to be rebuilt.
Yesterday’s train ride was thankfully uneventful and today’s even more so, but there was a sad reminder of the disaster on both days, when the train came to a crawl as it approached the deadly curve at Spuyten Duyvil. Another reminder was several pieces of heavy equipment used for cleanup, still sitting near the tracks.