What If Uber and ZipCar Had a Baby?
Imagine a world in which all of the cars on the road are navigating without a human driver. We may also anticipate another liberating aspect – the “ownerless” car. Well, some entity will own the car, but it may not be you or me.
Several motoring trends are moving towards convergence; Uber and ZipCar are already changing the way we move about. The potential for a driverless car changes those models. What could happen when autonomous cars are demonstrably safer than human-piloted vehicles?
Uber and Lyft essentially replace hailing a cab with ordering and paying for your ride through your smartphone. No cash changes hands, your driver is motivated to be polite and keep a clean vehicle because you will rate him after the experience.
When will this all happen? Many experts say “sooner than you think,” but Warren Buffett is still investing in car dealerships.
At the same time, city residents who don’t own cars but occasionally need one can turn to ZipCar instead of taxis or car rentals. After a small monthly membership fee, ZipCar users pay an hourly rate. It’s an on-demand model for car use.
This model isn’t new to us. Just 10 years ago, we bought our music on CDs (or MP3) and bought movies on DVD. Now, people everywhere are rapidly switching to a streaming model for music and movies – think Pandora, Spotify, Roku, Chromecast and Netflix.
With streaming, we save the costs of purchasing a library of movies or music, and we save the hassle of maintaining this library. We find it convenient to have every song and movie title at our fingertips.
Imagine, then, how the utility of Uber and ZipCar is compounded by the potential for autonomous vehicles. When we want a ride, the car comes to us, takes us safely to our destination, and then departs.
We don’t buy the car, insurance, gas, or parking space. We are freed from the time and expense of vehicle ownership.
The implications of this “streaming transportation” model are far-reaching. Some experts predict that, because most cars are idle most of the time, we would need only one out of eleven cars currently on the road.
While there is great opportunity for robotics experts and upstart transportation entries like Google and Tesla, how do Ford and Toyota react?
Reduce the car count by 90 percent, reduce the number of accidents even further – what happens to car insurers? Auto insurance exists to help us recover from the costs of human error. Once you take human error out of the mix, auto liability will be an issue for the manufacturer, not the (absent) driver.
Other implications – parking garages will be largely unnecessary; local mechanics won’t be needed; doctors and hospitals will have fewer patients; reduced congestion might spark inner cities, but easier commutes might spark development outside the cities.
Drunk driving, texting and driving, and driver fatigue will all be problems of the past. Leisure travel might mean you get in your RV at 10pm and wake up 8 hours later at your resort destination. No person is denied transportation due to age or ability to drive.
When will this all happen? Many experts say “sooner than you think” but Warren Buffett is still investing in car dealerships.
It will likely happen sooner in cities than rural areas, but the certain thing is that this disruptive technology will create great opportunities while destroying a lot of traditional business models.
Those Darn Tenant Losses: Causes
If you are a landlord, insure habitational risks, or have the responsibility for placement of insurance, then you know there are many possible scenarios that can cost you money, but the number one loss driver is fire caused by tenants.
There is a long laundry list of crazy and preventable causes for these fires and certainly some scary statistics, especially for those of us with families to protect. But when warnings on everything from space heaters to candles and power cords fail to prevent accidental fires, what can be done to help protect landlords and tenants from potentially severe losses?
This is Part One of a two part series. First, let’s look at some common fire causes on tenant properties. In the next article, I will focus on what we, as an insurance community, can be doing to provide a solution for these inevitable issues.
Candles can be romantic, set the mood or simply just be the cheapest way to provide light, but they are also a common cause of fires by tenants. Tenants frequently forget about their lit candles and leave them unattended.
When warnings on everything from space heaters to candles and power cords fail to prevent accidental fires, what can be done to help protect landlords and tenants from potentially severe losses?
These forgetful tendencies can lead to a very unromantic turn of events when you find yourself standing outside your building with your neighbors watching firemen extinguish a fire that spread through the entire building including your home.
Smoking is another major cause of fires. Many fires are created by tenants who smoke in units that have oxygen tanks or fall asleep with a cigarette still burning. Both of these examples are extremely dangerous and well-publicized, yet remain a leading cause of fires.
Heating and electrical issues are also primary causes of fires by tenants. Every winter, there are tenants who forget to turn off their portable space heaters, both electrical and fuel-based, creating vulnerability to possible dangerous outcomes. And then, unfortunately, some tenants forget to turn off the stove before leaving their unit.
Children playing with fire are yet another obvious, yet quite common, source of dangerous problems. We all hear stories of kids playing with matches or a lighter, without fully comprehending the risks, which can lead to very serious accidents.
The most outlandish story that I have heard is of a tenant setting a cat on fire that ran around the apartment, creating a full-unit fire. Wow.
Clearly, the list of causes for tenant fires can go on and on, from the common causes to the more unconventional. And it seems most of these fires can or should be prevented, controlled, or managed better.
However, it has yet to be determined or made clear who exactly is responsible for these fires. It’s hard to manage a fire (and the losses they cause) without determining who is culpable and pursuing actions to mitigate and prevent future instances.
With all of these fire drivers and losses, what are the landlords and their insurers to do? Stay tuned for Part Two with a proposed solution.
Making the Marine Industry SAFE
When it comes to marine based businesses there is no one-size-fits-all safety approach. The challenges faced by operators are much more complex than land based businesses.
The most successful marine operators understand that success is dependent on developing custom safety programs and then continually monitoring, training and adapting.
After all, it’s not just dollars at stake but the lives of dedicated crew and employees.
The LIU SAFE Program: Flexible, Pragmatic and Results Driven
Given these high stakes, LIU Marine is launching a new initiative to help clients proactively identify and address potential safety risks. The LIU SAFE Program is offered to clients as a value added service.
“The LIU SAFE program goes beyond traditional loss control. Using specialized risk assessment tools, our risk engineers function as consultants who gather and analyze information to identify potential opportunities for improvement. We then make recommendations customized for the client’s business but that also leverage our knowledge of industry best practices,” said Richard Falcinelli, vice president, LIU Marine Risk Engineering.
It’s the combination of deep expertise, extensive industry knowledge and a global perspective that enables LIU Marine to uniquely address their client’s safety challenges. Long experience has shown the LIU Risk Engineering team that a rigid process will not be successful. The wide variety of operations and safety challenges faced by marine companies simply cannot be addressed with a one-size-fits-all approach.
Therefore, the LIU SAFE program is defined by five core principles that form the basis of each project.
“Our underwriters, risk engineers and claims professionals leverage their years spent as master mariners, surveyors and attorneys to utilize the best project approach to address each client’s unique challenges,” said Falcinelli.
The LIU SAFE Program in Action
When your primary business is transporting dry and liquid bulk cargo throughout the nation’s complex inland river system, safety is always a top concern.
The risks to crew, vessels and cargo are myriad and constantly changing due to weather, water conditions and many other factors.
SCF Marine, a St. Louis-based inland river tug and barge transportation company and part of the Inland River Services business unit of SEACOR Holdings Inc., understands what it takes to operate successfully in these conditions. The company strives for a zero incident operating environment and invests significant time and money in pursuit of that goal.
But when it comes to marine safety, all experienced mariners know that no one person or company has all the answers. So in an effort to continually find ways to improve, SCF management approached McGriff, Seibels & Williams, its marine broker, to see if LIU Marine would be willing to provide their input through an operational review and risk assessment.
The goal of the engagement was clear: SCF wanted to confirm that it was getting the best return possible on its significant investment in safety management.
Using the LIU SAFE framework, LIU’s Risk Engineers began by sending SCF a detailed document request. The requested information covered many aspects of the SCF operation, including recruiting and hiring practices, navigation standards, watch standing procedures, vessel maintenance standards and more.
Following several weeks of document review the LIU team drafted its preliminary report. Next, LIU organized a collaborative meeting at SCF’s headquarters with all of the latter’s senior staff, along with McGriff brokers and LIU underwriters. Each SCF manager gave an overview of their area of responsibility and LIU’s preliminary findings were reviewed in depth. The day ended with a site visit and vessel tour.
“We sent our follow-up report after the meeting and McGriff let us know that it was well received by SCF,” Falcinelli said. “SCF is so focused on safety; we are confident that they will use the information gained from this exercise to further benefit their employees and stakeholders.”
“It was probably one of the most comprehensive efforts that I’ve ever seen undertaken by a carrier’s loss control team,” said Baxter Southern, executive vice president at McGriff, which also is based in St. Louis. “Through the collaborative efforts of all three parties, it was determined that SCF had the right approach and implementation. The process generated some excellent new concepts for implementation as the company grows.”
In addition to the benefits of these new concepts, LIU gained a much deeper understanding of SCF’s operations and is better positioned to provide ongoing loss control support.
“Effective safety management is about being focused and continuously improving, which requires complete commitment from top management,” Falcinelli added. “SCF obviously is on a quest for safety excellence with zero incidents as the goal, and has passed that philosophy down to its entire workforce.”
“SCF’s commitment to the process along with LIU’s expertise was certainly impressive and a key reason for the successful outcome,” Southern concluded.
There are many other ways that the SAFE program can help clients address safety risks. To learn more about how your company could benefit, contact your broker or LIU Marine.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Liberty International Underwriters. The editorial staff of Risk & Insurance had no role in its preparation.