Protecting Collectibles from Hurricanes
When renowned art attorney Scott Hodes set out to transfer some artwork from his residence in Chicago to a newly purchased townhouse in Miami, he was surprised to learn that a number of art insurers in South Florida did not offer fine art insurance during the hurricane season.
Hodes, senior counsel at Bryan Cave LLP, also learned that the building of well-protected warehouses in the Miami area for high-end objects such as fine art was a booming business.
The warehouses allow collectors to store their valuables during hurricane season before having the art warehouse move the collectibles back to their residences between December 1 and June 1, when hurricanes generally are not a threat.
“The art warehouse business has really taken off in South Florida,” said Hodes.
Melissa Kalka, fine art manager of Chubb Personal Insurance for Chubb Group of Insurance Cos., said that her company “interacts with the growing number of warehouses storing fine art and other valuables in the South Florida market by having a number of specialists … inspecting warehouses.”
Chubb, she said, has a number of loss control features that it considers important when inspecting warehouses that its clients and prospective clients may consider doing business with. The insurer also keeps a database of preferred vendors for clients needing to use such services.
In that way, she said, “the insurer can be very nimble in being able to say what facilities are well protected.”
Also contributing to the growth of art warehouses is an increasing number of collectors who “buy and hold” art as an investment and who may not have the proper facility or the desire to house the art themselves, said Linda Sandell, Huntington T. Block’s chief underwriting officer.
“Most art storage warehouses provide two insurance options,” she said. “Either the warehouse will insure the collection and charge an additional fee, or the insured maintains their own [insurance] and signs a waiver for the warehouse.
“If the warehouse insures the collection, it is important for the collector to review the coverage to confirm that it is adequate for their needs, just as they would when insuring the collection through their own insurer.”
Huntington T. Block’s clients in South Florida include collectors of all sizes, as well as important museums, galleries, artists and conservators. ”With a well-planned executable disaster plan, fine art insurance is generally available and affordable, even in coastal areas, said Sandell.
“The important thing for clients,” said Jennifer Schipf, senior underwriter, fine art and specie at XL Catlin, “is that they really do their research to find a warehouse that not only specializes in fine art, and there are several wonderful ones in the South Florida area, but to also do their research among friends and peers to make sure they’re getting good recommendations and good feedback from people who have used the same warehouse they are considering.”
It’s also important to know what type of warehouse facility you are considering, Schipf noted. “If it’s a fine art warehouse, they should have climate control to protect art as much as possible,” she said.
Collectors also need to understand that most warehouses make sure they are not liable for loss of property of more than the required 60 cents per pound of property that they are holding, which only scratches the value of art these days, she said.
“So it’s absolutely critical that if clients expect to have insurance coverage when their artwork is in the warehouse that they secure that coverage themselves,” Schipf added.
Vanessa Amor, business manager for Museo Vault, a state-of-the-art insurance warehouse that stands dramatically against the Miami skyline, said the warehouse was designed to withstand the 200 mph winds generated by even the most powerful hurricanes. Art is also stored at least 35 feet off the ground to protect it from aggressive storm surge.
“Our art facility was built from the ground up four years ago in a state-of-the-art manner to the standards that were required by the insurance industry … to store the fine art and other valuables, such as classic cars, antique furniture, sports memorabilia, expensive jewelry, among other things,” she said.
Amor stressed that Museo Vault was not a self-storage facility. It has a robust 24/7 security system. “You name the sensor, we have it,” Amor said.
“You can’t just walk in here to access your valuables,” she said. “Everything is very controlled. You have to have an escort with you at all times.”
Added Amor: “We can provide insurance if a client wants to obtain insurance for a particular work.”
She said that the idea for Museo Vault came after the busy 2005 hurricane season, highlighted by Hurricane Katrina.
In addition to Museo Vault, there are a number of other prominent art warehouses in South Florida.
Fortress Miami, which has been open for 30 years, recently completed an expansion and renovation of its private viewing gallery, which offers several options for displaying art depending on a client’s preference, day or night.
A similar facility, Robo Vault, opened up more recently in South Florida. Robo Vault has an area for storing wine and seven enclosed garages with a robotic arm to store and retrieve exotic and antique automobiles.
Webinar – Value-Based Purchasing in WC: An Idea Whose Time is Here
Getting excellent medical results for injured workers at a price that is both predictable and reasonable doesn’t seem like too much to ask. So why is it that the workers’ comp industry and its vendors can’t get this one right?
This webinar’s expert panel is going to show us the way forward. We’ll hear from a California-based medical provider who is contracting with carriers to produce high quality results with spinal injuries, one of workers’ compensation’s toughest and most expensive challenges.
We’ll also talk to the executive director of one of the largest state funds, which has launched a pilot program to use value-based medical provider compensation in managing hundreds of worker knee injuries.
Lastly, we’ll hear from a workers’ comp company that has successfully launched a value-based program for bundled orthopedic surgical procedures.
Furthermore, the expert panel will discuss:
- The impact of healthcare reform and the creation of accountable care organizations; and the need for workers’ comp to recognize that it must inevitably follow the trend away from the flawed fee-for-service model.
- How improved modeling is giving payers and providers much better transparency into their risk portfolios of injured workers, and how those analytics can be acted on.
- That although frequency is down, workers’ comp costs continue to rise. Merely watching this trend and doing nothing is not an option.
- The challenges of bundled or value-based purchasing, presenting a holistic view of this topic.
- The recommended steps workers’ comp can take today to implement value-based models, moving the industry towards walking the walk not just talking the talk.
Managing Patient Safety in a New Health Care World
Much like regular screenings, exercise and a healthy diet, patient safety in health care institutions should be thought of as preventive medicine.
“Patient safety aims to relieve the burden of fixing mistakes by taking steps to prevent them from happening in the first place,” said Aileen Killen, head of casualty risk consulting, AIG.
With the right strategies and protocols in place, human error in delivering patient care can, to some degree, be factored out, mitigating the risk of things like falls or medication mistakes. And the outcomes-based reimbursement model enforced by the Affordable Care Act provides extra incentive to improve patients’ overall experience and reduce readmission rates.
Some challenges stand in the way, though, of achieving better safety.
For one thing, increased consolidation in the industry has brought risks associated with integrating disparate safety cultures and ensuring continuity of care if patients are moved to a new doctor. The trend of shifting more care out of main hospitals to ambulatory sites instead also creates concern that those outpatient facilities are not up to the same safety standards as larger organizations.
Finally, advancing technology — while offering great promise to eventually make health care more efficient and error-free — presents significant risks in its implementation while doctors, nurses and other health care professionals learn how to best use it.
Lexington Insurance, a member of AIG, is meeting the demand for more innovative tools to navigate the changing environment with a suite of safety assessment programs that identify problem areas and provide recommendations for improvement.
Assessing Safety Culture
The first step in overcoming any challenge is assessing the situation in order to create the best strategy.
“Every health care organization should aim to become a ‘high reliability organization,’ or HRO,” said Brenda Osborne, division executive, health care, Lexington. “It’s a term borrowed from the airline and nuclear power industries, in which any employee has the right to shut down operations if they spot a safety issue.”
Lexington’s Best Practice Assessment tool allows organizations to compare their own protocols against evidence-based best practices and identify weak spots in their safety culture.
“We survey employees and ask if they feel free to speak up to people in authority,” Killen said. “If they can all say yes, you’re on the road to a safety culture. Then we drill down into specific high-risk areas.”
Clients can conduct specific assessments for error-prone areas like the emergency department, obstetrical department and operating room.
We give organizations recommendations on how they can improve in areas where they are deficient, and we can benchmark their performance against the best practice as well as against other institutions that have done the same assessment,” Killen said.
Those benchmark comparisons are key for securing leadership buy-in. Executives often need to see what other institutions are doing in order to feel confident in their decisions to make changes or invest more heavily in patient safety measures.
If another competitive hospital has better staffing ratios, for example, benchmark stats will show that and support the C-suite’s decision to hire more nurses to achieve a similar ratio.
“What it basically does is give the risk management, patient safety and quality improvement staff a roadmap for which areas to focus their activities for improving patient safety and risk management at their organization,” Killen said.
Acquisitions and Physician Employment
The flurry of merger and acquisition activity in the health care industry creates new risks for large hospital networks that acquire physicians’ practices. The integration of different patient safety and risk management practices can prove difficult.
“You have to take multiple approaches and mindsets and meld them into one fluid organization,” Osborne said. “That has a big impact on physicians’ ability to treat patients and deal with the appropriate hand-offs.”
“Patient hand-off is one of the biggest safety challenges,” Killen said. “Assigning a patient’s care to a different doctor leaves room for gaps in communication, which is so critical to making the correct diagnosis and keeping a medication schedule.”
Lexington’s Office Practice Assessment tool scores acquired practices on 14 different domains, including risk management and patient safety, communication, infection control and prevention, incident reporting and medication safety, among others. Recommendations are provided for any domain that scores less than a perfect 100 percent.
“We’ve been able to go in and help these growing organizations benchmark each of these acquired physician offices to show where they are at in terms of their safety protocols,” Osborne said. “It helps risk managers know where they need to start.”
Another major challenge for patient safety is the movement of care away from main hospitals to ambulatory care settings, an area that previously did not concern hospital-based risk managers very much.
“Historically, there has not been a big focus from a patient safety standpoint on outpatient services,” Osborne said. “The office practice assessment that AIG’s been doing for the last two or three years has actually put us out in front. Few other resources out there can assist hospital-based risk managers in dealing with outpatient-type services.”
“Now more people are thinking about safety in ambulatory areas, and we have more knowledge and experience there,” Killen added.
The same office assessment tools that survey physician practices can also be applied to ancillary services like ambulances, blood banks, and outpatient surgery centers, though benchmarking is not yet available for these sites.
Adapting to new technology is an ongoing challenge for health care risk managers.
“Everyone thought electronic health records were going to solve all our patient safety issues, but they’ve come with some unintended and dangerous consequences,” Killen said. Employees may accidentally order medications for or even discharge the wrong patient, for example, if they have multiple records open at once.
The upside to technology advancements, though, is more streamlined documentation and more opportunities for communication between doctors and patients via telemedicine, which is slowly growing in popularity for remote and elderly patients.
“When we’re underwriting, we look at these areas of growth in technology and the many ways it can be applied,” Osborne said. “We consider all the pros and cons.”
Lexington’s dedication to improving safety in health care shines through in their thorough assessment tools, expert recommendations, and attention to insureds’ changing risk management needs.
“Our unique tools help insureds identify risks and minimize potential claims,” Killen said.
“These services are homegrown and developed by a lot of very knowledgeable people over a period of time,” Osborne said. “They’re not available out in the market, and only Lexington insureds have access to them.”
For more information about Lexington Insurance’s risk management services for the health care industry, please visit www.lexingtoninsurance.com.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Lexington Insurance. The editorial staff of Risk & Insurance had no role in its preparation.