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By Jared Shelly

At the seven Seminole casinos peppering Florida's luscious landscape, blackjack games are dealt around the clock, slot machines deliver a constant barrage of clinging and clanging, and there always seems to be a roulette wheel spinning.

You may think that Sinberg spends her time trying to figure out how to catch cheating gamblers or crooked dealers. In fact, she's more worried about slip-and-falls in the hotel bathtubs or the safety of pyrotechnics at one of the concert venues.

That's because risk management in gaming is about a whole lot more than gambling, especially as smaller casinos expand to offer bars, restaurants, shops, entertainment and hotels. Risk managers at large casinos in Las Vegas or Atlantic City are used to managing such complex risks, but their counterparts in newer, smaller gambling meccas such as Florida, Pennsylvania, Maryland and New York are forced to play catch up.

The Seminole Tribe opened its first facility in 1979, as a high-stakes bingo hall and casino. It now boasts seven casinos with dining, nightlife and entertainment. At Philadelphia Park in Bensalem, Pa., the horseracing track was awarded a slot license in 2006. By 2009, the facility became PARX, a posh casino with eight restaurants, two bars, a nightclub -- and a plenty of nongaming risks.

The same is true in many states, as a surge of new, fast-growing casinos have emerged.

The gambling floor, ironically, is far from the only draw. In fact, 16 percent of visitors say they rarely or never gamble when visiting a casino, according to State of the States, a 2011 study by the American Gaming Association.

The study found that 75 percent of visitors to a casino ate at a fine dining restaurant, 56 percent saw a show, 47 percent went shopping, 39 percent visited a bar or club and 38 percent used facilities like a spa, pool or fitness room. Clearly, nongaming amenities are a large part of the visitor experience.

In turn, gaming risk managers need to be jacks-of-all-trades, so hiring people outside of the gaming industry might be a good bet. "I had no background in casinos," said Sinberg, who spent a career with JM Family Enterprises, an automotive dealer and financier before moving to Seminole seven years ago.

But, as she says, "risk is risk" and an experienced risk manager can learn as their facility expands. Over the years she's become an expert in such seemingly unrelated topics as Indian gaming and slip-resistant floor testing.

In gaming, every day can bring a new risk management adventure, like the time the Seminole Casino Coconut Creek added a new attraction called "Dining in the Sky," where patrons eat dinner on a platform 180 feet in the air. Sinberg had to make sure the vendor had proper licensing and experience and general liability insurance coverage of around $10 million with subrogation waivers.

Jan Schnabel, Marsh Inc.'s Hospitality & Gaming practice leader, said that casinos typically have a general liability policy that encompasses all guest incidents. An umbrella policy allows casinos to add new risks as they arise. Concerts and special events are typically written on an individual basis, she said.

Workers' comp "by itself is enormous in hotel restaurant casinos" said Schnabel. Injuries and illnesses can beset casino workers. Casinos typically have relaxed rules regarding smoking indoors, exposing workers to health risks. Pennsylvania and New Jersey ban smoking indoors, but casinos there have smoking sections, for example. In fact, six out of every 10,000 nonsmoking Pennsylvania casino workers will die each year because of exposure to secondhand smoke, according to an article in the American Journal of Public Health.

With so many different exposures, things can get complex quickly. Sinberg said that Seminole has 10 separate insurance policies on the casino side of the business alone.

Risk management practices also need to evolve fast if smaller casinos are to turn into large resorts. The Wynn in Las Vegas has three pools and two hot tub areas surrounded by bars constantly serving alcohol. If smaller casinos around the country follow suit, they'll have to ramp up their risk management practices to make sure they're doing all they can to prevent injuries and protect themselves from possible claims.

Regulations also come into play. New requirements from the Americans with Disabilities Act Amendments Act require chair lifts for swimming pools, which can be expensive for a resort casino.

There is also plenty of increased competition for the gambling dollar. On the East Coast, Atlantic City used to be the undisputed casino champion but Pennsylvania is right on its heels. Why drive to Atlantic City when you can get a similar gambling experience closer to home?

Pennsylvania casinos raked in more than $3 billion in revenue in 2011, according to the Pennsylvania Gaming Control Board, up 22 percent from the previous year. New Jersey brought in $3.3 billion in gaming revenue in 2011, a 7 percent drop from the previous year. Higher revenues are sure to continue to lead Pennsylvania casinos out of racing and gambling, or the "racino" model, and into more of a resort model. That means more pools, spas, hotel rooms, restaurants, nightclubs and over-the-top attractions -- and much more complex risk management.

Let's not forget the risks that arise from the combination of gambling, entertainment and alcohol, said Stuart Newman, labor and employment partner with the law firm Seyfarth Shaw in Atlanta. That can lead to volatile situations on and off the casino floor. Newman advises risk managers to train employees to spot emotional or intoxicated patrons and find ways to calm them down.

"Show a personal interest in every customer and any customer that seems to be excited or upset needs to be handled with kids' gloves," said Newman. "It's a complex business, managers and supervisors of employees have to be cognizant and ever watchful of the behavior of employees and the behavior of customers."

Casino executives hope that such a personal touch may also help stem the tide of slip-and-fall cases which are ravaging casinos. At Seminole casinos, for example, Sinberg estimates that 75 percent of its losses come from slip-and-fall or trip-and-fall incidents. While there are certainly true slip-and-fall injuries, casino floors can't be that slippery, so a personal touch may help prevent a faulty claim.

Risk managers also need to be ready when casinos decide to add the dazzling or dangerous, such as a rollercoaster, bungee jumping or a rock climbing wall. Whatever the attraction, they should be sure to provide safety information, said Newman. "Make sure they understand this is an inherently dangerous activity," he said.

Another risk is the sheer amount of transitory workers at these facilities, said Eric Savage, co-chairman of the hospitality practice group at Littler. With bartenders, waiters, cleaning staff and others turning over so quickly, they may not feel loyal to their companies. They'll either seek work at a competitor or -- if that's not an option -- they'll be quick to report a perceived discrimination or harassment issue.

"Employees who may not believe that there are good employment options available elsewhere, are more likely to bring their concerns to HR."

JARED SHELLY is senior editor/Web editor of Risk & Insurance®. He can be reached at riskletters@lrp.com.

June 1, 2012

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