Dealing with Civil Unrest
Retailers and other companies across the country are looking for a Plan B in the wake of riots that destroyed stores in Ferguson, Mo. and now Baltimore.
Meanwhile, carriers might seek to recover their losses from damage and business disruption claims by suing cities that tell their police to stand down to give space to protesters who “wished to destroy.” What’s unknown at this point is whether carriers would prevail.
Companies need to develop contingency plans specific for each location to manage events such as riots, as well as situations that could lead to them and the resulting consequences, said Sean Ahrens, security consulting services practice leader for Aon Global Risk Consulting in Chicago.
A key part of such planning includes determining under what circumstances onsite managers or a crisis management team should close retail locations.
“Now is also the time to review contingency plans to understand what other locations can be used during a time of unrest, as well as making sure companies that supply goods to them have alternative ways to make their goods available.” — Lance Becker, vice chairman, Northeast region, Arthur J. Gallagher & Co.
“Organizations that have robust plans and contingencies may actually have shelter in place to protect employees during civil unrest,” Ahrens said.
“But if a company has no policies or procedures in place, then in the worst case scenario, they should close the store and evacuate. Ultimately, a company’s duty of care is to protect their employees from all hazards.”
Post-event, companies should also provide counseling for employees who were caught up in a riot, though a lot of them might not want to come back, he said.
Tracy Knippenburg Gillis, global reputational risk and crisis management leader for Marsh Risk Consulting in New York City, said there are a lot of factors that determine when to close a facility, such as whether it serves a critical function in the community, or whether employees would lose needed income if the store closed prematurely during peaceful protests.
“Most organizations should have their crisis management teams on alert, if not actively engaged, monitoring and potentially making decisions on delayed openings or closures over the course of events,” Gillis said.
“They should be communicating to employees what they are doing and ideally monitoring what authorities are doing, so they can make the right judgment at the right time.”
Marsh has several clients in retail, hospitality and other entertainment-related industries that were impacted in last month’s Baltimore riots. Several suffered business disruptions due to curfews imposed by the city, said Bob O’Brien, a managing director in Marsh’s national claims practice in Washington, D.C.
“Companies should practice situational awareness,” O’Brien said.
“They have to go through several steps continuously, identifying exposures to the company and their supply chain. They should be aware of what’s going on all around them that could potentially impact them if they are caught up in a freeze zone or a closure zone.”
Companies should also review their insurance coverage to make sure they have the proper terms, limits and retention, he said. After an event, they should apply all possible triggers that could impact a claim, whether direct damage or civil authority that results in service interruption and ingress/egress issues.
Companies should make sure to secure documents to better ensure payment of their claims, he said.
Arthur J. Gallagher & Co. also had clients that suffered losses and filed claims as a result of the upheaval in Baltimore, said Lance Becker, vice chairman, Northeast region in New York City.
Becker said the recent riots that impacted area businesses serve as “an education” for companies to make sure their insurance policies cover “civil authority and unrest,” which would pay for either physical damage or losses for not being able to gain entry to the store.
“Now is also the time to review contingency plans to understand what other locations can be used during a times of unrest, as well as making sure companies that supply goods to them have alternative ways to make their good available,” he said.
Carriers might seek to recoup their losses by suing Baltimore, as several news outlets have reported that the police there were ordered to “stand down” and not prevent rioters from looting, burning or destroying stores, including a CVS pharmacy and an Ace Cash Express store.
Baltimore Mayor Stephanie Rawlings-Blake denied there was a stand down order, and she also told “Meet the Press” last Sunday that she regretted saying in an earlier press conference that space was given to protesters who “wished to destroy.”
Terrence Graves, a shareholder at Sands Anderson PC law firm in Richmond, Va., said that any city that experiences civil unrest might have sovereign immunity for those sorts of actions dealing with the police force.
“If a city government — like any other governmental entity — takes action within what is considered its governmental sphere, such as making political decisions, as opposed to its proprietary sphere such as providing water services or maintaining city streets, then a city might have governmental immunity,” Graves said.
“There is an interesting test that most courts would run though in order to determine whether the city was acting as a government or as a landlord.”
Can ‘Ebola-mania’ Give Way to a National Reset?
Ebola is not a new contagion and it is one for which the United States has been preparing for since at least post-9/11 heightened bioterrorism concerns.
While some may be critical of the care provided to the first patient with Ebola in Dallas, as well as resulting communication issues involving hospital and medical officials, clearly all involved intended to do their very best under uniquely stressful conditions that rarely any American hospital had faced before.
In what will surely be a repeating pattern in the near-term, American hospitals, clinics and doctors, as well as employers and other entities will continue to periodically encounter individuals that have acquired the Ebola virus and require treatment. The country will also have periods where there may be no known cases.
As of Nov. 11, and for the first time in 41 days since the initial U.S. patients, there were no known cases of Ebola in the U.S. That was short-lived as within days thereafter a surgeon who had contracted the Ebola virus in West Africa was transferred to the United States for treatment, but unfortunately the patient died.
I believe we should attempt a national “reset” to manage this public health issue in America — based on science and evidence.
In order to do so, it is important to understand the causative factors leading to the arguably explicable initial national panic surrounding Ebola. In the early moments of a risk crisis, leaders get limited chances to establish credibility and trust. The populace and media want to know the risk is understood and under control.
Early slips in Dallas failed this test, as I mention in my first article on this subject.
While some may feel on edge with regard to changing CDC guidance, in fact, the CDC is adjusting to new information and changing their guidelines appropriately; not dissimilar to how managers of risk adjust to any hazard exposure.
As managers of risk, we should be assessing the risks Ebola presents.
Ebola is really no different than other significant risks (e.g., terrorism post-9/11, Y2K, swine flu, grounding of certain airplanes).
There is a common pattern that moves from initial organic obsession to an easing, understanding, and respect of the risk that becomes balanced with other important considerations such as civil liberties, promoting international health, and maintaining world economic balance, for examples in the context of contagion risks.
For the emerging risk of Ebola in America, we are at a pivotal point to learn from the recent past and venture forward with the best of science and evidence-based risk management.
Will America press the reset? As risk managers, we stand in an influential position within our organizations to utilize the proven methods and tools of managing enterprise risks, including contagion risk.
As such, risk managers are in a unique position to lead with others; to reset the response to the Ebola virus in our unique national microcosm and move to a balanced American view appropriately and respectfully managing our interests while simultaneously attending to world health risk issues, especially in West Africa.
Read all of Jeff Driver’s Risk Insider articles.
RIMS Recap: Tech Trends that Could Change Everything
Last month, Gordon Clemons, CEO and Chairman of CorVel Corporation, presented at the RIMS Conference in New Orleans, La. about emerging technology and how it is impacting risk management and workers’ compensation. The discussion served as a springboard for new insights on how technology will change the industry, and reaffirmed the need for integrated systems and human interaction for the best results.
The presentation noted the future is here – and technology is constantly evolving in hopes of outpacing tomorrow’s needs. As these technology platforms become more inherent in daily life, the gap in translating their utilization to workers’ compensation will begin to close.
Technology in Healthcare
While many consumer-based technology advancements exist in other industries, perhaps most notably in the retail space helping vendors to reduce various delays in the sales experience, people may forget that healthcare, too, is a consumer industry. And as such, healthcare also experiences workflow lags, which can be collapsed.
While patients and claims may not lend themselves as freely to mobile applications and technology that subscribes to the “Internet of Things” philosophy, the rapid rate of development foretells the not-too-far-off arrival of the “a-ha,” “wow factor”-type application that consumers are seeking in the healthcare industry.
Once we get there, we can only expect that the Pangea of resources will yield better outcomes. The potential impact to medical management includes more affordable/accessible healthcare, patient convenience, personal assistance, automatic inputs to claims systems and less administration from both patients and injured workers.
“Healthcare is stubborn about change. There are more data points in healthcare and there is a greater need for high quality and accuracy,” Clemons said.
Tech Trends for the Next Digital Decade
As an industry advocate in all things innovation, CorVel has been keeping tabs on emerging tech trends. As they begin to influence in other industries, it sparks the question – will they eventually change workers’ compensation?
Here are some of the trends on CorVel’s radar:
Smart phones and tablets were the first mobile devices to really start to gain traction across people’s personal lives. Since then, wearables (like Fitbits and smart watches) have been part of the next digital generation to be taken up by consumers.
As these personal devices quickly advance, wearables could offer payors and employers added insight into the wellness of claimants through the extent of their retrievable data.
Beacons are devices that use low-energy Bluetooth connections to communicate messages or triggers directly to a smart device (such as a phone or tablet). Retailers have started using this technology, sending offers to near-by consumers’ phones. Now the concepts of smart mirrors and smart walls offer a one-stop-shop with recommendations related to the preferences of the shopper – making a hyper-efficient business model. It is possible that we could see these devices adapted to being a catalyst for healthcare’s business model by reducing the delays of administrative work.
Formally known as unmanned aerial vehicles (UAV), drones can be remote-controlled or flown autonomously through pre-defined flight plans within their internal systems. Some carriers are testing the use of drones to potentially be used to evaluate property damage and responding to natural disasters.
As most injuries reported in workers’ compensation are musculoskeletal injuries, the industry lends itself well to the benefits of telecommunications and telemedicine. With the rise of electronic capabilities, telemedicine becomes another option to help guide an injured worker through their entire episode of care, reducing time delays.
In order to get to that point in time, implementing these trends (and those that are yet to be launched) will only be as successful as the population willing to accept them. Buy-in will require a commitment to the long-standing pillars of the industry. According to Clemons, “While technology can truly move the needle in workers’ compensation, it will take more than bells and whistles to maximize its impact.”
“People’s feelings are valid. The skepticism surrounding new technology is not misplaced, but neither is the enthusiasm,” Clemons said.
New Trends, Same Priorities
Beyond the buzzwords and hype surrounding the latest apps and devices, for new technology to succeed within the workers’ compensation realm, it boils down to the two primary concepts that drive the industry to begin with – effective infrastructure and a people-first philosophy.
The power of applicable resources and the actionable data that results from them is in the foundation of the systems themselves; that primarily being through the influence of integration. It is not a new concept; however, as technology advances and the reach of analytic capabilities broadens, it is important to find a provider that can harness this data and channel it into effective workflows to increase efficiencies and promote better outcomes.
CorVel’s proprietary claims management system has been developed and supported by an in-house, full-time information systems division to be intuitive and user-friendly. Complex, proprietary algorithms link codified data across the system, facilitating collaboration between services, workflows, customers, and technology and eliminating the risk that a crucial piece of information will be missed. The result is an active “ecosystem” providing customers with actionable data to provide the most accurate, comprehensive picture at any time, while also collapsing inherent delays.
For the injured worker, the critical human touch connection in the workers’ compensation process can never be minimized. By cutting lag time throughout the various inefficiencies underlying the industry’s workflows, CorVel can connect injured workers with quality care sooner. As systems advance, claims and managed care associates do not have to spend as much time on administrative work and will instead be able to devote more time to the injured workers, reviving the human touch aspect that is just as impactful within the industry.
Regardless of the technology that lies ahead, CorVel looks to the future with investments in innovation, while not losing sight of their role and responsibility to clients and patients. Dedicated to constant improvement for the services they provide injured workers and industry payors, CorVel is committed to improving industry services one app, click, drone (or whatever is yet to come) at a time – perhaps something to discuss in San Diego at next year’s RIMS conference.
For more information, visit corvel.com.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with CorVel Corporation. The editorial staff of Risk & Insurance had no role in its preparation.