Category Archives: Insurance

by | March 13, 2010 · 9:05 am

Hospitality Industry Safety: Hotel Management Must Insure That ALL Staff Are Prepared For And Knowledgable Of Fire Safety System

 

“Sleepless in Seattle”: A true fire alarm tale reveals lessons “From the Field”

This last weekend, I stayed at a full service hotel in downtown Seattle. When I checked in, I was delighted to receive a room on the very top floor of the hotel (the 20th floor), as I was excited about having a spectacular view of Seattle. It was my first time visiting Seattle, so I was looking forward to an “adventure”. Yes, I was about to have an “adventure”.

The adventure begins

After a great dinner, I went to bed. At 4am, my “adventure” started. The fire alarm siren went off like an atomic bomb exploding inside my guestroom. It was very LOUD and CLEAR. Now, I am an experienced hotel security and risk management professional, so what did I do? Exactly what everyone who has any experience with hotel fire alarms would do…I stayed comfortably in my warm bed. I suspected that someone got caught smoking in a hallway, or an employee burnt a piece of toast, setting off the alarm.

Then it came….a barely audible PA announcement. “This is hotel security, there’s a fire in the hotel, evacuate the hotel using the South stairwell!” The announcement was made only ONCE, and it was hard to hear and understand, BUT it was enough to get my warm butt up and evacuating. By the way, which way is South? There was no compass in my guestroom to point me in the right direction.

I exited my hotel room and immediately met up with eight women who had just exited their rooms, but did not know where to go, or where the South stairwell was. They were standing a mere ten feet away from the stairwell door. I knew exactly where the stairwell was, as I am a trained risk management professional, and always make a mental note of all emergency exits on my floor when I stay at any hotel. (Truth be told, I had to use the stairs earlier to get a soda from a machine on the floor below. But don’t tell my wife, she thinks I actually was pre-prepared for the fire and that impressed her.)

We all evacuated the hotel down the stairwell. Yes, I’m talking 20 flights of evacuation stairs. I didn’t think that view of Seattle was so “spectacular” now. I do have to say I loved every moment of it though, as I was participating in an actual hotel emergency, but WAS NOT responsible for it. As a risk manager for the hospitality industry, I spend a majority of my time training, planning and preparing hotels for these types of emergencies. I was now being “a fly on the wall” in an actual emergency in all its glory.

Lessons learned

With every experience, come lessons to learn from in order to seek improvement. Here are the lessons I learned:

  1. If you’re going to evacuate a hotel, make more than one announcement on the hotel-wide PA system. Guests who are startled at 4am need more than one announcement to clear their head and have them understand what you want them to do. At least three announcements should be made in succession. 
  2. Mark all emergency exit stairwell doors. They should be marked with a sign on the actual door of the stairwell, both at eye-level and at ground level. The Seattle hotel had the mandated illuminated “Exit” signs high above the doors, but it did not have a simple “emergency exit” sign or “stairs” sign on the door to the stairwell. The guests I met in the hallway were literally in front of the stairwell door, but did not recognize it as such, because there was no marking on the door itself. People do not look up during a crisis. The illuminated “exit” signs could be concealed if smoke was in the hallway. As smoke rises, it would cover signs that are posted higher than three feet from the ground. This is why all hotels should post room numbers and exit signs also on the bottom of the door face. Currently, only a handful of counties and municipalities require this as code. 
  3. Train hotel staff how to use the emergency fire panel. I learned from talking to other guests that floors 3, 4, 5, and 6, along with floors 18, 19 and 20 were the only floors evacuated. Floors 7 through 17 were not evacuated and received no fire alarm siren at all. I have to surmise that hotel personnel who were operating the fire panel did not completely understand how to operate the panel properly, because the actual fire was on the 5th floor. A decision to evacuate floors 18-20 but not 7-17 made no sense whatsoever. 
  4. As a side note, I was absolutely shocked at how many adults actually wear pajamas to bed. I would have never guessed that many.

 

In retrospect

After the entire incident, I was pleased to discover that all of the things us risk managers stress over and over again actually do have merit.

Educate your staff on how to operate your hotel’s fire life safety system. Make sure every management, night audit, engineering and security employee knows how to operate the fire panel and PA system. Train all employees about their respective response roles in the event of a fire alarm and/or hotel evacuation. This must be a carefully orchestrated procedure in order to minimize risks to guests and staff alike. And keep in mind, as never fails, most hotel fire alarms do occur during the overnight shift when no one is expecting them and there are the least number of staff to respond.

Review your hotel’s Emergency Response Plan, and make sure it has been updated. Ensure all personnel actually read and understand the emergency plan on a regular basis. A yearly fire drill with evacuation is recommended.

Post-script

The actual fire was a small grease fire that occurred on a stove in the restaurant’s kitchen. The kitchen was on the 5th floor of the hotel. While the hotel probably did not need to be evacuated at all, there was a large amount of smoke, so I’m sure the limited hotel staff on duty decided to be safe than sorry.

(Todd Seiders 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 | March 12, 2010 · 10:18 am

Hospitality Industry Risk Management: Two-Thirds Of Hotel Owners Find Meeting And Exceeding OSHA Standards Reaps Three-Fold Savings Over Every Dollar Invested In Safety

Section 5(a)(1) of the Occupational Safety and Health Act requires employers to furnish a workplace free from recognized hazards. E911 is an important component of an employer’s emergency action plan. An organization cited by OSHA for workplace violations could potentially be subjected to significant fines.

— A fire, act of violence or employee accident can have a devastating impact financially and emotionally on an organization. Beyond the direct expense of loss of life and property in a crisis, operations also can be significantly disrupted.

According to a survey by the Liberty Mutual Group, about two-thirds of employers report a three-fold savings for every dollar invested in safety.

(From a TMCNet.com article)   The need to comply with state E911 legislation is a prime motivator for adding E911 protection to IP, PBX (News – Alert) and Centrex phone systems. Over the past decade, a significant percentage of RedSky E911 solutions have been sold to enterprise, government, university and school district customers with operations in at least one of the 16 states with legislation on the books.

But why don’t organizations in states without E911 legislation take measures to ensure that first responders can quickly find employees, visitors and students in the event of an emergency at the same rate as organizations in these 16 states?

http://www.tmcnet.com/voip/0210/beyond-legislation-why-e911-matters.htm

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by | March 11, 2010 · 8:45 am

Hotel Industry Risk: Cybercrime Has Targeted Hotel Wireless Networks To Steal Credit Card Information

Travelers staying in hotels might want to carefully check their credit card statements for fraudulent charges in the months following the stay. According to recent reports, cybercriminals across the globe have a new favorite target: the wireless networks of hotels.

(From a CreditCardGuide.com article)  While financial services companies used to receive the bulk of hacker attacks, last year hotels emerged as the new choice target among hackers-out of 218 breaches in a total of 24 countries, 70 of those breaches took place through hotel networks, according to a report by security firm Trustwave SpiderLabs.

Internet security experts believe that hotel hacking attacks started to catch on at the end of 2008, when a sophisticated cybercrime organization broke into a hotel network to steal information and discovered just how easy it was to do. Even larger hotel chains are often poorly protected against cybercrime dangers, making it very easy for hackers to gain access to one computer and then use it as a doorway into the hotel’s central computer system, from where they can lift the credit card data of guests staying at the hotel along with other sensitive information.

Once hackers have retrieved the data they need, the cybercriminals waste no time turning the lifted credit card information into profit. Using high-tech equipment, hackers can easily clone credit cards, complete with a magnetic strip containing the stolen data. The cards are indistinguishable from the real thing and can be used in physical stores leaving behind few traces that can be used to track down the fraudsters.

It often takes hotels months before they notice the hack-last year, the average time between a security breach and discovery was over five months. In many cases, it is credit card companies, as opposed to the hotel chain, who first notice the unauthorized activity. Long after hackers make off with their bounty, credit card companies triangulating fraud reports discover that multiple individuals affected by fraud stayed at a specific hotel just prior to the credit card theft.

As awareness of hotel data breaches rises, many of the larger chains are stepping in to step up security. However, consumers should remain on alert: hacker’s aren’t about to give up this new lucrative target. Just this week, Wyndman Hotels, which operates chains including Days Inn, Ramada, and Howard Johnson reported its third breach in the past 12 months.

If you travel often or frequent hotels, make sure to monitor your credit card accounts. If strange activity shows up, contact your card issuer immediately. While credit card companies, ultimately, are on the hook for fraudulent charges, you do have to report unauthorized activity, and catching credit card fraud early can save much time and hassle down the road.

http://www.creditcardguide.com/creditcards/travel/staying-hotel-watch-credit-cards-231/

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by | March 9, 2010 · 8:01 am

Hospitality Industry Risk: Employment Practices Liability Insurance Is Highly Recommended To Protect Against “Workplace Romance-Related Lawsuits”

It is tougher in a smaller work environment because there are often fewer options. And it’s expensive for small business owners to insure against it by purchasing employment practices liability insurance. We always recommend that they do have that, because it covers employee lawsuits and attorney’s fees.

(From a BusinessWeek.com article)   There’s no doubt that each year, lots of people fall in love with their co-workers or their bosses. Other employees typically get swept up in workplace romances through the gossip mill. But while they can’t be prevented, office liaisons are not always a joy for business owners. And they’re more difficult to handle when they occur at small companies, says attorney Mark Kluger, who chairs the labor and employment practice at Mandelbaum Salsburg in West Orange, N.J. He spoke recently to Smart Answers columnist Karen E. Klein about workplace relationships from a decidedly nonromantic perspective. Edited excerpts of their conversation follow.

You advise your clients against establishing a written policy prohibiting workplace romance. Why?

Employers cannot control human nature, so a workplace romance policy is unenforceable. And if you establish one, it sends a negative message to employees about your company’s willingness to impose itself into their personal lives.

The other thing is that you don’t want to create a Romeo and Juliet situation. If there’s a policy against workplace romances, people will feel they must lie and sneak around, and that’s the last thing you want.

http://www.businessweek.com/smallbiz/

content/feb2010/sb20100211_326976.htm

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by | March 4, 2010 · 4:38 am

Hospitality Industry Risk: Workers’ Compensation Insurance Premiums May Rise Due To Higher Medical Costs, Even As On-The-Job Injuries Decline

“…on-the-job injuries are down, but claims are heftier because of higher medical costs.”

(From a BostonHerald.com article)   The Workers’ Compensation Rating and Inspection Bureau of Massachusetts is seeking a 4.5 percent average increase in policy premiums, effective Sept. 1.

Attorney General Martha Coakley yesterday announced her opposition to the proposed increase, saying the hike would cost small businesses and other employers more than $40 million in extra premiums.

The workers compensation bureau – a nonprofit group of insurers licensed as a rating organization by the state Division of Insurance – says on-the-job injuries are down, but claims are heftier because of higher medical costs. Rates have not risen since 2001.

The group’s request for a 2.3 percent rate increase in 2008 was hit with a lawsuit by the attorney general’s office. The legal move led to a settlement in which insurers agreed to a 1 percent rate reduction – saving businesses some $30 million, Coakley said.

http://www.bostonherald.com/business/general/view/20100303ag_hits_plan_to_hike_workers_comp/

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by | March 2, 2010 · 6:33 am

Hospitality Risk Management: OSHA Proposes New Rules To Track Workplace Muscluloskeletal Disorders

“It will increase the number of recordable incidents by broadening what might qualify as an MSD,” he says. “So after collecting the data for a while, I wouldn’t be surprised to see OSHA announce that there is a major MSD problem and decide to do something about it.”

Ashley Brightwell, a partner in the Atlanta office of Alston & Bird, agrees the rules could lead to “future actions by OSHA to regulate MSDs … and increase the number of citations being issued against employers.”

On Jan. 29, OSHA proposed new rules that would require employers to track and report workplace-related musculoskeletal disorders. While the changes are ostensibly little more than additional record-keeping, experts warn the proposal could likely pave the way for further enforcement and rulemaking by the agency.  

OSHA wants to restore a column to the OSHA 300 log that would record work-related musculoskeletal disorders, such as carpal-tunnel syndrome and rotator cuff syndrome. The rules are identical to those contained in an OSHA record-keeping regulation that was issued in 2001 by the Clinton administration, but was removed in 2003 during the Bush presidency before ever going into effect.  

Critics argued at the time that the definition used to describe musculoskeletal disorders was far too broad to be useful and that the new column wouldn’t contain the type of detailed information that would be needed to address the problem of musculoskeletal disorders.

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by | February 28, 2010 · 6:08 am

Hospitality Industry Risk: Many Hotel Spa’s Are Underinsured With Spa Owners Liable For Injuries To Clients

(From a SmartMoney.com article)  With the growth of the spa industry, consistent standards have become an afterthought. Industry associations do exist, but membership is strictly voluntary. The biggest one, ISPA, represents about 3,200 spas worldwide, but its application process isn’t exactly grueling. Members must agree to abide by the association’s “standards and practices,” which include requirements such as clean treatment rooms and staffers trained in CPR.

They also have to adhere to a code of conduct, which is a list of spa-goers’ rights and responsibilities, says ISPA’s executive director, Lynne Walker McNees. But in the end, spa industry regulations vary from state to state, so there’s no uniform set of guidelines.

As a result, many spas carry inadequate insurance, says Mary Lynne Blaesser, a certified insurance counselor at the Marine Agency, which has provided coverage for about 15,000 spas. “In most states, the only insurance spas are required to carry by law is workers’ comp,” Blaesser says.Without professional or general liability in effect, an injured customer would have to seek recourse or reimbursement directly from the spa owner rather than an insurance company. However, most leases require that lessees carry general liability coverage for such things as trip and fall claims.

The combination of spotty insurance and almost nonexistent refund policies means one thing for dissatisfied customers: Good luck collecting if something goes wrong. And that applies even for the most egregious mishaps. Leandros Vrionedes, a personal-injury lawyer in New York City, had a client whose day-spa facial turned into a horror show. “The esthetician oversteamed the client and applied the wax immediately after,” Vrionedes says. “She wound up taking part of this person’s face off — several layers of skin were removed. The spa argued that it was the fault of the product and we didn’t have a case. We argued that it was the procedure.” After five years of legal wrangling, including trial to verdict and an appeal, the woman received an undisclosed settlement — which her lawyer describes as “not enough.”

Even when a spa does carry insurance, consumers may have a tough time obtaining compensation for injury.

“Some insurance companies will fight you tooth and nail,” Vrionedes says. Don’t assume, though, that you have no case just because of some lengthy waiver you signed when you arrived at the facility. According to Vrionedes, some of these documents will hold up in court, but others won’t — especially those that are all-encompassing. If the release “absolves the spa of absolutely everything in the world,” he says, courts will sometimes void the agreement.

http://www.smartmoney.com/spending/deals/10-things-your-spa-wont-tell-you-10378/?page=3

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by | February 26, 2010 · 6:07 am

Hospitality Industry Privacy: Hotels Must Safeguard Guests’ Privacy And Provide Better Hotel Security As Erin Andrews Incident Demonstrated

On October 12, the television magazine Inside Edition aired a segment in which they visited several hotels to reserve a room next to an employee who was posing as a hotel guest. In each case, the hotel was unaware of the purported sting operation. In each case, without challenging the inquirer, the reservationist complied.

  As a result of the unauthorized video release on the Internet and the suspect’s demonstrated pattern of stalking Ms. Andrews, several news media organizations are calling or visiting hotels and asking for specific rooms, next to specific registered guests (typically undercover media producers posing as registered guests) to see what security measures are in place at the hotel. Commonly referred to as “tabloid journalism,” various media outlets have resorted to these stings to entrap hoteliers doing something wrong and to boost their viewership ratings.

  On October 12, the television magazine Inside Edition aired a segment in which they visited several hotels to reserve a room next to an employee who was posing as a hotel guest. In each case, the hotel was unaware of the purported sting operation. In each case, without challenging the inquirer, the reservationist complied.

So, what can and should hotels do to avoid falling prey to investigative reporters and more importantly ensure the safety and privacy of their guests? Here are eight steps to get started:

  1. ESPN's Erin Andrews

    Immediately start discussing this case with the hotel’s front desk and reservation staff. Make sure that everyone realizes the widespread magnitude and fallout of the privacy violation of Ms. Andrews. If you need more info, “Google” Erin Andrews, and you can get all the latest news from the Internet. In fact, just by searching the keywords “hotel” and “peeping tom” more than 213,000 hits will be revealed in Google, almost all referring to the Erin Andrews incident. And of course the name of the hotel where the incident occurred appears in nearly every hit.

  2. Revisit basic hotel security and privacy procedures, and do some staff training at your hotel. Now more than ever it is appropriate to ask more questions of guests, challenge suspicious people on your property, and evaluate your security cameras, security policies, locking entrance doors, elevator and stairwell access, etc. And expect the stings by investigative journalist to continue into the foreseeable future.
  3. Empower hotel employees to challenge requests for rooms next to other guests. Hotel staff members should ask the requestor why they would like a specific room, and what their relationship is with the person they are requesting to be housed adjacent to. Do not grant the special room request without contacting the other guest and securing their permission; ask them if they know the person who is requesting the special room. We all hate to say “NO” to anyone for anything, but times have changed, and a hotel must take a more proactive stance in guest safety and privacy.
  4. To the extent possible, do not block VIP guests or celebrities in rooms until the morning of arrival. Only advise non-management employees about the name and room number of the celebrity on a “need to know basis” and never in advance of arrival. This will help prevent the identity and location of the celebrity from becoming known outside the hotel and individuals seeking accommodations near the celebrity’s guestroom.
  5. Be more curious and suspicious, and allow staff members some leeway in also being more careful. Do not criticize or punish employees for being too safe. Remember, it is a different world out there from a few years ago. Safety and privacy must be the first priority of every hotel nowadays. Guests expect nothing less.
  6. If a guest complains, IT DOESN’T MEAN YOU DID SOMETHING WRONG! I have to keep reminding my clients of this fact. Sometimes guests “think” they know a law, or industry standard, when in fact many do not know what they are talking about. Hotel employees have every right to ask more questions of a guest who is requesting a room next to someone else, to refuse to connect a caller to a room number where they do not know the registered guest’s name, or to ask questions of a guest loitering around the hotel.
  7. Change your mindset from an immediate “YES” to a more carefully thought out response to guest requests that places safety and privacy at the forefront. Start evaluating guest requests more carefully, and how they may apply to guest security issues. “YES” is always the appropriate response if the request does not compromise the safety and privacy of others or the hotel. If it does, then the correct response is a courteous “NO” with the offer of a suitable alternative (if possible).
  8. Remember, Management retains the right to ask any news media personnel off hotel premises. You do not “have” to answer questions, especially if the media “ambushes” you with cameras in your face. If you find someone walking around your property doing a secret undercover investigation, you can order them off your property immediately. Hotels are considered private property and Management retains complete control of who can and cannot be on your property, as long as such ejection does not violate regulations, statutes or ordinances designed to eliminate illegal discrimination in hotels. Train all employees to refer all media requests only to the hotel’s designated spokesperson and discipline or terminate employees who fail to comply with the workplace rule. Finally, call the police for assistance if media refuse to comply with requests to leave the hotel’s premises.  

(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 | February 24, 2010 · 6:35 am

Workers’ Compensation In California: Next California Governor Will Face Challenges To States Workers’ Compensation Reform

(From a Sacramenton Bee article) When Arnold Schwarzenegger deigns to catalog his accomplishments, reforming the state’s system of compensating workers for job-related injuries and illnesses ranks high on his list.

One of Schwarzenegger’s first acts six years ago was bulldozing the Legislature into a sweeping overhaul of workers’ compensation, reducing both eligibility for direct payments to disabled workers and medical care costs.

The system is so large that the legislation and the administration’s subsequent implementation rules cut employers’ costs by about $15 billion a year, or approaching $100 billion so far.

Workers’ comp politics being what they are, however, the changes generated fierce opposition from those on the other end of the pipeline, namely unions, disability attorneys and medical care providers.

http://www.sacbee.com/2010/02/22/2554129/dan-walters-workers-comp-battle.html

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by | February 19, 2010 · 2:01 pm

“Workplace Accident Prevention” Needs To Be A Higher Priority In Hospitality Industry As Surveys Show Most Worker’s Compensation Carrier Decisions Based On Pricing

Survey results... found that price drives the choice of workers' compensation carrier for 3 out of 4 (71%) restaurant owners and other decision-makers.

(From a Hotelnewsresource.com article)  Workplace accident prevention apparently remains a persistent problem as nearly half (44%) of restaurant owners and managers reported at least one costly workers’ compensation claim in the past five years-and 10% percent reported five or more claims within the same period.

Despite this accident reporting, a majority (61%) of survey respondents who changed carriers at their last renewal reported switching because of price. Workers’ compensation insurance carriers track policyholders’ loss experience to help determine premiums, as accident frequency can directly affect restaurants’ insurance premium pricing. Service-driven workers’ compensation insurance carriers like EMPLOYERS focus on the potentially significant savings that could be realized through effective use of workplace safety and accident prevention efforts.

http://www.hotelnewsresource.com/article34605Restaurant

_Survey_Finds_Focus_on_Workers__Comp_Price_Trumps_Accident_Prevention_Savings.html

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