Category Archives: Insurance

by | November 2, 2010 · 8:46 am

Hospitality Industry Employee Health Risks: Swine Flu Outbreaks Could Cripple Small To Medium-Sized Companies If “Half Of Their Workforces Were Out Sick For Two Weeks”

Only one-third reported that they could sustain their businesses without “severe operational problems” if the swine flu kept half their workforces out sick for two weeks, according to the survey.

Swine flu is a type of influenza caused by a virus which can cause serious health complications or even death in a small proportion of the population. Officially called Influenza A H1N1, the symptoms are similar to ordinary flu (e.g. fever, headache, sneezing) but can be more severe.

The federal Centers for Disease Control and Prevention in Atlanta estimates that the H1N1 virus has infected more than 22 million people in the U.S. since April, and more than 4,000 people nationwide have died of related complications. The proportion of deaths attributed to influenza already has exceeded what is normally expected at this time of year, with the young hit the hardest, the CDC says.

    At the same time, a survey published in September by the Harvard School of Public Health found that the pandemic and resulting absences could have devastating effects on U.S. businesses. Only one-third reported that they could sustain their businesses without “severe operational problems” if the swine flu kept half their workforces out sick for two weeks, according to the survey.

    Jennifer Benz, who runs Benz Communications, a San Francisco-based employee benefits communication firm, says many of her clients have begun health education campaigns but have stopped short of analyzing all the issues that could arise from a pandemic.

    “It’s very easy to post communications throughout your company, such as washing your hands when you sneeze, but to really look at changing policies is a much different thing,” she says. “It’s a tough business environment right now.”

    Many companies may do more if they see absenteeism soar, she says, but by then, it may be too late. “I think a lot of companies have a plan in their back pocket. If their work site gets hit really hard, then they’ll look at ‘How do we respond?’ ”

    The flu pandemic highlights the importance of providing robust health benefits, such as more than one or two sick days a year, she says. But ad hoc solutions, such as allowing employees to work from home, will fail if a company hasn’t thought them through by, for instance, providing enough access to laptops and ensuring that computer networks can support large numbers of workers dialing in.

    Furthermore, just telling employees to stay home doesn’t help if the company has a weak sick-leave policy or doesn’t provide paid sick time for hourly or part-time workers. “For low-wage workers, missing some days off can mean the difference in paying your rent that month,” Benz says.

    In many cases, businesses are opting against more aggressive efforts because of cost and privacy concerns, says Russell Robbins, a principal and senior clinical consultant in the Connecticut office of HR consulting firm Mercer. Unfortunately, it’s easy to dismiss warnings over H1N1 as paranoid or an overreaction, but the truth is that the flu is likely to spread, Robbins says.

    “I just keep saying that the only way we’re going to weather through this is if we’re prepared for a crisis,” he says. “In other words, make plans now.”

For more:  http://www.workforce.com/section/benefits-compensation/feature/ounce-prevention-or-pound-cure/index.html

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by | October 31, 2010 · 12:44 pm

Hotel Industry Employee Risk Management: Employee’s Use Of Stairs In Multi-Story Hotels Subject Them To “Significantly Greater Risk Of Injury” And Result In Higher Workers’ Compensation Benefits

“Because the employees’ periodic breaks were mandatory, Phillips was required to use the staircase six times during each shift. In fact, in its opening brief, Rio calculated that during the course of Phillips’ 17-year employment, she traversed the stairs approximately 25,000 times,’
 
“…the court concluded that the frequency with which Phillips was required to use the stairs subjected her to a significantly greater risk of injury than the risk faced by the general public. Consequently, Phillips should be awarded benefits, the high court wrote…”
 

The Nevada Supreme Court has ruled that although employers are not “absolutely liable” when employees are injured “on the job,” companies should apply the “increased risk test” to determine whether they are entitled to workers’ compensation benefits.

The justices explained the increased risk test in Rio All Suite Hotel & Casino v. Phillips. According to court documents, Kathryn Phillips was a poker and blackjack dealer at the Rio All Suite Hotel & Casino in Las Vegas. While taking her mandatory 20-minute break during her usual eight-hour shift, she walked down the stairs to the employee break room, slipped, and fractured her ankle.

Her treating physician determined her injury was work related, and Phillips had surgery to repair her ankle. But Rio’s third-party administrator, Sedgwick CMS, denied her claim saying Phillips did not prove the injury arose out of her employment.

“The types of risks that an employee may encounter during employment are categorized as “those that are solely employment related, those that are purely personal, and those that are neutral,” the high court said.

 

 

 

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by | October 30, 2010 · 5:26 am

Hospitality Industry Fire Risk Management: “Security Alert! Check The Security Of Your Hotel’s Knox Boxes Frequently” By Todd Seiders, CLSD, Petra Risk Solutions

Risk Management

by Todd Seiders, CLSD

Check your Knox Boxes! A Knox Box, known officially as the KNOX-BOX Rapid Entry System, is a small, wall-mounted safe-like box that holds building keys for firefighters and EMTs to retrieve in emergencies. In many jurisdictions, the local Fire Department requires that a Knox Box be located outside of your hotel (check with your local Fire Department for requirements; some jurisdictions may not require hotels to have one), for their use only, in the event of an emergency. The Knox Box has a complete set of the hotel’s master keys locked inside this box.

Knox Boxes simplify key control for local fire departments. Local fire companies can hold master keys to all such boxes in their response area, so that they can quickly enter a building without having to force entry or find individual keys held in deposit at the fire station. Sometimes Knox Boxes are linked via radio to the dispatch station, where the dispatcher can release the keys with telecommunication tone signaling over analog phone lines.

Knox Boxes have advantages and disadvantages for both business owners and emergency responders. The main advantage for their use is that they cut fire losses for building owners since firefighters can more quickly enter buildings without breaking doors or windows. The disadvantage of the system is that it provides a single point of failure for security. If the key to a district’s Knox Boxes is stolen or copied, a thief can enter any building that has a Knox Box. Likewise, if the locking mechanism or structural integrity of the box is compromised, a thief can gain access to the keys and hence access to the entire building. For this reason some building owners wire Knox Boxes into their burglar alarm systems so that opening the box trips the alarm, thus negating its use in facilitating clandestine entry.

 
 
 
 

Todd Seiders, CLSD, is director of risk management for Petra Risk Solutions, which provides a full-range of risk management and insurance services for hospitality owners and operators. Their website is: www.petrarisksolutions.com. Todd can be reached at 800-466-8951 or via e-mail at: todds@petrarisksolutions.com.)

 

Knox Boxes are an actual miniature safe designed to withstand tampering and are built in a variety of sizes ranging from a box designed for two keys to one designed to hold hazardous material information and multiple keys. Prices start at approximately $250.00. Most Knox Boxes are mounted onto a wood or steel mounting with the screws or bolts covered.

Yet, this does not mean that Knox Boxes are indestructible or cannot be removed from their mounting with force. We have recently seen many of these Knox Boxes forcefully removed from their wall mountings and stolen from the property. In several cases the thieves then returned to the hotel with the master keys and stole items.

In one theft at a hotel the thieves specifically used the master keys to access the storage room for the hotel night audit packets and guest files. The thieves stole hundreds of night audit packets containing the names, addresses and credit card numbers of previous guests. Obviously, hotels can be held liable for breach of guests’ personal information or loss of their credit card data.

So, what should hoteliers do? Secure your night audit packets/files in a secure room that has a hard metal key, rather than a magnetic key card lock. There should only be one or two hotel employees that have access to the night audit storage room, and storage room keys. Secure these files separately, and control all access to them. DO NOT include a key to this storage room in your Knox Box, or on your “master key ring”, or even leave this key unattended in a key box. The night audit file storage room key should be kept separate from all other keys.

As for the hotel’s Knox Box, local ordinances may require that your property have a Knox Box in the event of an emergency. If so, follow these suggestions:

  • Check that your Knox Box is solidly secured to its location, using numerous heavy duty screws or bolts to make it extremely hard to remove.

 

  • Relocate your Knox Box to a well lit area, and in view of security cameras, if your property has them.

 

  • Add a visual inspection of the Knox Box to your property inspection form and security tours so it will be inspected on a regular basis. This will let you know in a timely manner if someone has tried to remove it, or has in fact actually removed or damaged. Immediately re-key the entire hotel if the Knox Box is stolen or the keys inside come up missing. 

 

Pictured above: Here’s what some of the various Knox Boxes look like.

(Todd Seiders, CLSD, is director of risk management for Petra Risk Solutions, which provides a full-range of risk management and insurance services for hospitality owners and operators. Their website is: www.petrarisksolutions.com. Todd can be reached at 800-466-8951 or via e-mail at: todds@petrarisksolutions.com.)  

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by | October 18, 2010 · 9:38 am

Hospitality Industry Health And Safety: Use Of “Improved Safety Practices” And “Older Workers” Contribute To A Decrease In Workers Comp Claims

“Indemnity and medical severity for workers compensation claims continued to rise in 2009…

“…the frequency of workers comp claims dropped 4% in 2009 following a 3.4% decrease in 2008. A downward trend in claims frequency that started in 1991 likely will continue through this year, NCCI said…”

Factors such as increased use of robotics, improved safety practices and an aging workforce have contributed to the continuing frequency decrease, NCCI said.

Complex claims, such as those related to carpal tunnel syndrome and lower-back issues, declined more than average during the past five years, NCCI added.

Increasing claim costs, however, have partially offset the decline in frequency. Average indemnity costs increased about 4.5% in 2009 despite a decline in average weekly wages.

“It remains to be seen whether changes in average wage and indemnity cost per claim will begin to converge in 2010,” NCCI said in the research brief.

Average medical costs for workers comp claims rose 5% last year, the lowest increase in the past 15 years, NCCI said.

For more:  http://www.businessinsurance.com/article/20101018/NEWS/101019945

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by | October 11, 2010 · 2:08 pm

Hospitality Industry Health Risk Management: Hotel Owners Must Establish Formal “Bed Bug Infestation Risk Management” Protocols For Preventing And Then Eradicating Infestations

In certain cases, courts can even levy large judgments against hotel operators who rent rooms infested with bed bugs. In 2003, a federal appellate court awarded $372,000 in

State inspectors have the authority to shut down an establishment that poses an "imminent health hazard" involving fire, flood, sewage backup, rodent infestation, bed bug infestation or "any other condition that could endanger the health and safety of guests, employees and the general public."

punitive damages, roughly 37 times the compensatory award in the case, to a couple bitten by bed bugs while staying at a chronically infested Motel 6 in Chicago.

Hotel owners and operators have faced periodic reports of bed bugs for decades, but a newfound public fascination with the problem, combined with the proliferation of websites dedicated to documenting bed bug outbreaks, has created a frenzy of media activity never before seen. Indeed, bed bug stories have been reported in the New York Times, Washington Post, Wall Street Journal, and many other local television and print outlets across the country. Stoking the traditional media’s interest in bed bugs is a rash of new online forums where travelers post the unsettling details of encounters with the pests.

Much of the coverage seems sensational and overblown, but property owners and third party operators in the hospitality industry have to face the reality that the process of eliminating bed bugs from hotel rooms can be quite expensive and can lead to litigation and costly settlements. Additionally, reports of infestation on online travel sites like TripAdvisor and bed bug reporting sites like bedbugregistry.com and bedbugreports.com can cause significant reputational harm and loss of business.

The good news for hospitality companies is that robust risk management practices, and the appropriate insurance and risk financing programs, can significantly mitigate the financial impact bed bugs can have on a hotel organization.

Establishing formal risk management protocols around bed bugs is an important first step in minimizing the cost of infestation. Proactive steps for hotel organizations include creating a formal program to train housekeeping staff on spotting bed bugs, creating a policy on how to handle outbreaks or complaints and implementing regular pest control inspections.

“Bed bugs are on our list of emerging issues facing the insurance industry, not only for hotels, but in the retail, apartment, and residential healthcare sectors,” noted Brian Gerritsen, Senior Director of Hospitality Business at Fireman’s Fund Insurance Company. “The recent increase in bed bug related claims has prompted us to become more proactive about the issue with our insurance customers.” Mr. Gerritsen’s team recently released an industry alert recommending that hotel operators take several actions to prevent potential infestations in guest rooms including:

• Chemically treating mattresses and sealing them in plastic

• Washing/drying bedding and towels regularly and daily if possible

• Vacuuming cracks, crevices and other hiding places and sealing openings permanently so the bugs don’t have a place to hide

• Having regular inspections and extermination services done by a qualified pest control contractor

• Training and educating housekeeping employees to recognize the presence of bed bugs and immediately report any activity to the appropriate personnel

For more:  http://www.pressreleasepoint.com/don039t-let-bed-bugs-bite-insurance-and-risk-management-perspective

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by | October 7, 2010 · 5:49 pm

Hospitality Industry Risk Management: Hotel Owner Must Review “Employment Practices Liability Insurance” Coverage Language To Determine If It Covers “Wage And Hour” Lawsuits

 In Professional Security Consultants, Inc. v. United States Fire Insurance Co., Case No. CV 10-04588 SJO (SSx), Judge James Otero recently denied an EPL insurer’s motion to dismiss a complaint seeking coverage for costs incurred to defend and settle an underlying wage and hour class action.    

The exclusionary language at issue was typical of such exclusions, barring coverage “for violations of the responsibilities, obligations or duties imposed by…the Fair Labor Standard Act…or similar provisions of any federal, state or local or foreign statutory or common law.”

The underlying litigation alleged that employer Professional Security Consultants (“PSC”) violated various provisions of the California Labor Code, including wrongfully withholding overtime compensation. PSC was insured under an EPL policy issued by United States Fire (“US Fire”). US Fire moved to dismiss the coverage action on the basis of its “FLSA” (Fair Labor Standards Act) Exclusion. Citing California law regarding the breadth and scope of an insurer’s duty to defend, the court denied US Fire’s motion.

The court noted that the policy’s definition of an “Employment Practices Wrongful Act” included “employment-related misrepresentations.” Comparing this policy language to the allegations of the complaint, the court emphasized the underlying plaintiffs’ allegation that PSC “[d]isseminated false information throughout [PSC’s] facilities and amongst [PSCs] employees, reciting that, under [PSC’s] labor policies and practices and under California law, the members of the Illegal Wages Class were not entitled to overtime compensation.” The complaint therefore alleged “employment-related misrepresentations,” triggering the potential for coverage under the policy.

The court also rejected US Fire’s argument that there was no potential indemnity coverage because any amounts allegedly owed to the underlying Plaintiffs were not covered “Loss” under the policy. The court observed that the policy’s definition of covered Loss included “damages,” and that the underlying complaint expressly sought to recover damages.

For more:  http://www.lexology.com/library/detail.aspx?g=75f1cf83-81de-43a4-8217-45ef67ed56ec

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by | September 17, 2010 · 9:26 am

Hotel Industry Security Risk Management: Hotel Management Can Limit Guest Theft Liability By Maintaining Room Locks, Posting Legal Notices, And Keeping Back And Side Entrances Closed And Locked

Security expert Chris McGoey of  CrimeDoctor.com defended the hotel’s security practices with one exception, the back door not requiring a key card to open. He says that if the victims’ story is true, it’s quite possible the theft was committed by another hotel guest.

Gallagher says he’s considered suing the hotel, but under state law, the hotel would most likely not be liable for the lost belongings because it provided locks for the suite and likely posted the various required legal notices inside of it.

As was later reported in the Chicago Tribune, the Gallaghers claim that when they went out for coffee on the second morning of their stay (as the Bruners slept soundly in another of the suite’s rooms), the suite was burglarized, resulting in the loss of $2,000 in valuables, including purses, wallets, cameras, cell phones and luggage.

Both couples blame the hotel’s lax security for allowing the theft to happen. But Lawrence Duffy, the hotel’s general manager, says the victims told him the break-in happened after they left their door propped open, an allegation the victims deny. He says the hotel rarely has problems with crime.

For more:   http://www.milwaukeenewsbuzz.com/?p=254429

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by | September 16, 2010 · 5:51 am

Hotel Industry Health Risk Management: Early Bed Bug Detection Is Critical For Successful Eradication Programs (Video)

[youtube=http://www.youtube.com/watch?v=0OOZ8wBuF0k&feature=channel]

Bedbugs have made a comeback in the US due to increased international travel. Bedbugs can crawl out of a traveler’s suitcases and establish themselves in hotel rooms. A Bedbug problem can be quite expensive. In fact, an outbreak could lead to serious litigation and large settlements and loss of business. Can your property afford it? This program trains your employees to spot bed bugs so they can be caught in the early stages and remediated before a major infestation occurs.

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by | September 14, 2010 · 6:05 am

Hotel Industry Health Risk Management: Hotel Owners Should Negotiate “Loss Of Attraction” Or “Contingent Business Interruption” Insurance Coverage For Losses Arising From Bed Bug Infestation

“…many hotels have negotiated for “loss of attraction” coverage, which covers the actual loss a hotel might sustain if it had to cancel reservations or was unable to accept bookings due to an infestation.”

State inspectors have the authority to shut down an establishment that poses an "imminent health hazard" involving fire, flood, sewage backup, rodent infestation, bed bug infestation or "any other condition that could endanger the health and safety of guests, employees and the general public."

“I would say both business interruption and to some extent contingent business interruption are two of the most difficult values for a business to assess,” says Craig Lapsley, vice president at Travelers Global Technology.

In evaluating those risks, companies have to consider their earnings, operating expenses and payroll–which is often overlooked but should be included, he says. In addition, companies need to consider how long they could be out of business and how long it could take to get back up and running.

“It’s difficult for insurance professionals, who do it all the time, and it’s extremely confusing for insureds,” Lapsley says.

Whenever there are large losses or catastrophic events, a very large percentage of insureds invariably turn out to be underinsured when it comes to business income, he says.

What makes contingent business interruption particularly tricky to assess is that it involves operations that are outside the company’s direct control. A company’s own operations may be in fine working order, but it may nevertheless suffer a significant loss of business income because of a disruption in the neighborhood, or with one of its suppliers, or with one of its buyers.

 For more:  http://www.riskandinsurance.com/story.jsp?storyId=13708831

 

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by | September 13, 2010 · 7:14 am

Hotel Industry Swimming Pool And Spa Risks: Las Vegas Hotel Suffers Chemical Malfunction In Pool Which Sickens Guests

Richard Brenner, hazardous materials coordinator for the Clark County Fire Department, said that sodium hypochlorite went into the hotel’s lazy river pool when a valve used to control the chemical malfunctioned and did not shut off properly. He also added that the chemical went into the water and fumes in the air had made guests sick but expected them all to be ok.

About 100 people had trouble breathing but did not need to go to hospitals, instead were treated by responding emergency personnel.  It was also reported that the people taken to local hospitals were conscious and alert and none of the guests were in critical condition.

High concentrations of a chemical similar to bleach seeped into a pool at the world-famous MGM Grand on the Las Vegas Strip, leading the hotel officials to evacuate some 1,500 guests and sending at least 26 people to local hospitals with breathing difficulties on Friday.

“People started smelling chlorine. It doesn’t take much to set our nose off”, Brenner said.

The MGM Resorts International officials emphasized that once it was discovered what happened the valve was immediately shut off. While the leak only affected the lazy river pool, all of the resort’s five pools were closed to error on the side of caution.

For more:  http://www.dailyrosetta.com/chlorine-leaks-at-mgm-grand-las-vegas-pool/1247.html

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