ALS Risk Articles and Information View Archive

Insurance Coverage Purchase Strategies

Cyber Strategy and Enterprise Risk Management (ERM)

A Contract Compliance Framework Can Reduce Risk

Cyber – Attacks on Executives

Email Risk Management

Hurricane Sandy – Insurance Lessons Learned About Flood, Wind and Hurricanes

Risk Management – Fine Print

POINT: Political Risk Must be Folded into ERM

Don’t get buried with Snow Removal – Effective Risk Transfer is Key

Business Continuity Planning

Insurance Coverage Purchase Strategies

The general insurance purchasing process is deeply flawed and prevents buyers from fully understanding what they are buying. Read the recent article by Albert Sica which outlines the strategy business owners need to use in order to secure competitive coverage needed to protect their businesses.

Insurance Coverage Purchase Strategies | by Albert L. Sica

Cyber Strategy and Enterprise Risk Management (ERM)

Last week, I attended an excellent Enterprise Risk Management (ERM) workshop hosted by NC State University which highlighted the myriad of issues impacting the maturity of ERM within organizations.

ERM lets companies take a broader, more methodical approach to identifying risk exposures and areas within the organization that could precipitate such event like a cyber breach.

The expenses an organization can incur as a result of a cyber breach can reach astronomical proportions and can negatively impact a company’s bottom line or in the most extreme cases bring the whole organization to a complete halt.

The article I co-authored with my colleague, Jon Edwards, Cyber Strategy and Enterprise Risk Management (ERM), provides a lot of useful links as well as the steps your organization can take to establish a proper risk framework.

While the topic of cyber security is at the top of the risk list for any CEO, instead they should consider how adopting an Enterprise Risk Management framework will give them greater transparency of the risk exposure their organization is facing.

A Contract Compliance Framework Can Reduce Risk

Monitoring insurance compliance in contracts is an important, albeit challenging, risk mitigation strategy. Read Al Sica’s recent article on the subject posted on Construction Executive Magazine website.

A Contract Compliance Framework Can Reduce Risk” – by Albert Sica

Cyber – Attacks on Executives

Your company’s business plan, financial and other confidential information can be breached by something as simple as you opening a seemingly innocent email. Corporate espionage is scary and quite real and Executives and Board Members are especially susceptible. We see examples of these types of attacks in the media everyday. The recent article from NYSE Corporate Board Member Magazine describes the careful planning that goes behind these attacks and provides some useful tips on how to protect your organization. It is a must read for any Executive. Click to read the full article “Becoming a Victim: How Executives and Board Members Unknowingly Fall Victim to Cyber-Attacks”.


Email Risk Management

If you subscribe to our email list, you might have read our comments regarding a recent article, “How to Master Email” discussing the risks posed by email in the workplace, despite the advantages of ‘e-discovery’ and permanent correspondence logging. You might find these email ‘best practices’ will save you time and money, increase your productivity, and even improve conversational clarity. A good ole’ fashioned phone call hasn’t gone out of style.

1. The “three email” rule – often people email each other to death…email should be used to support clear communication. If after the third email the parties are still going back and forth and the issue is not resolved we are strongly encouraging a “good ole fashioned” phone call…

2. Proofread your email carefully before you hit “send”. While useful, spell check is not a panacea and can frequently miss words that will change the meaning of your whole email. Errors in spelling, grammar and punctuation can damage your personal and your firm’s credibility, as well as dramatically alter the meaning of the document.

3. Don’t interrupt what you are working on to check your email. The article in Executive Travel magazine quotes BBC news who said that workers distracted by email suffer a fall in IQ more than twice of that found in marijuana smokers. Immediately answer only those emails that are truly urgent and you will see improvement in your productivity and the quality of your work.

4. Do not leave the subject line blank – many people delete subjectless emails. Email recipients often decidewhich email to open first by reading the subject line, so make sure the subject of your email is reflective of the purpose and point of the email.

So next time you feel like the emails will never end, remember you can help cut through the tedious back and forth, one sentence responses and be clear, concise and stay productive!

Hurricane Sandy – Insurance Lessons Learned About Flood, Wind and Hurricanes

Click to read the article “Hurricane Sandy – Insurance Lessons Learned About Flood, Wind and Hurricanes” which appeared in the February Edition of Property Owner’s Association (POA) Newsletter.

Risk Management – Fine Print

Click to read the article “Risk Management – Fine Print” which appeared in Risk Management Magazine.

POINT: Political Risk Must be Folded into ERM

Click to read the article “POINT: Political Risk Must be Folded into ERM” which appeared in Risk & Insurance Online.

Don’t get buried with Snow Removal – Effective Risk Transfer is Key

Be diligent in making sure your snow removal provider has the proper insurance coverage

With winter almost here, many companies are putting the final touches on snow removal contractor agreements. Liability claims relating to the “improper removal of snow and ice” are frequent, and in many cases, severe. Many of the claims originate from elderly people who often sustain injuries from slips and falls which they never fully recover from – in other words – BIG CLAIM!

Whether you are a manufacturing operation, a building owner or a property manager that has a parking lot, sidewalk and/or pedestrian ways, that need to be cleared of snow and ice, there are a few things to keep in mind:

  • Snow removal is the responsibility of the landlord and it is a critical exposure
  • The most expensive claims for landlords/property managers come from slip and fall accidents that occur on snow or ice as a result of ineffective removal
  • A key risk management step is transferring this risk to a contractor when obtaining snow/ice removal services

Steps that a Business Owner should take:

  1. Seek a reputable contractor that has well kept and properly maintained snow removal equipment
  2. Identify a contractor with a strong safety record
  3. Have a written agreement that contains scope of work, insurance requirements, and hold harmless indemnity provisions.
  4. Obtain proper evidence of insurance (this would include a Certificate(s) of insurance as well as copies of necessary endorsements that evidence required insurance coverage extensions as well as the nature of operations)

Regardless of the job size or scope, you, as a landlord or property manager, want to make absolutely certain the contract contains insurance requirements that stipulate the contractor procure, at their own cost and expense, and maintain, for the life of the agreement with you, necessary insurance coverage to defend and indemnify you in the event of a claim due to their negligence. The required insurance coverages must include general liability coverage, automobile liability coverage and workers’ compensation coverage. Furthermore, you will need to be an Additional Insured with respect to any liability arising out of the contractor’s services and confirm that the contractor’s policy provides “full contractual liability” to support an indemnification provision in the Owner’s favor for liability arising out of such services. Lastly, your name and address is to appear in all Certificate Holder sections on ALL Certificates issued. Full disclosure of the Insurance Requirements must be made at the bidding/contract negotiation stage.

Before any work is performed by the contractor you will have to obtain and review the Certificate(s) of Insurance and any supplemental documents (an example of supplemental documents is the Additional Insured Endorsement). Be sure it provides evidence of each coverage noted above and specifically states the snow and ice removal services being provided are covered. In many cases, summer contractors do snow removal as a seasonal engagement, without providing notice to their carrier. The Certificate is normally issued by the contractors’ insurance agent, whose name and phone number appear on the Certificate.

Furthermore, you must also be cognizant of the ability for the insurer or insured to cancel their coverage. You should require that all policies not be cancelled, terminated or modified by the company unless 30 days (minimum) prior written notice is given to you. This is usually evidenced on the Certificate of Insurance If you receive such notice, do not let the contractor enter your premises until replacement coverage is provided with all the provisions noted above.

It is also recommended that upon receipt of a Certificate of Insurance, you contact the issuing broker and ask them to confirm, in writing (email is acceptable) that all the coverage noted on the certificate is correct.

Consider the following claim example. Would you like to be on the hook for this?

You are the owner/property manager of an upscale mall. A customer slips and falls on ice covered steps and suffers a broken ankle which requires open reduction and fixation. The customer is a business woman with a family. In addition to $40,000 in medical expenses and $35,000 in lost wages, the family required the services of domestic help to compensate for the loss of services of the working mother. These costs amounted to $17,500 over the five months the customer was injured. In legal terms, the injured customer has “specials” (referring to actual out of pocket expenses) of $92,500. In addition, the permanent disability suffered as a result of the severe fracture, pain and suffering and the family’s “loss of services” and you are looking at a claim worth upwards of $350,000.

By having the proper indemnity, hold harmless language as well as necessary insurance coverage in your agreement with the contractor, you are better able to protect the assets of your company against claims arising out of accidents involving snow and ice removal, by transferring the exposure to the contractor providing the service.

Please click to request a sample snow removal contract.

Business Continuity Planning

With the end of the year rapidly approaching, one of the most significant “lessons learned” in 2012 was that Disaster Recovery (DRP) or Business Continuity Planning (BCP) are critical parts of any business’ overall strategic plan.

In one of my many airport lounge stopovers, I noticed the article “Business Resiliency and Natural Disasters”.
While in an October publication, I think it is both timely and informative. I have reviewed the references in the article and found the FEMA Business Continuity Site a helpful resource to broach the subject. Links to these sites are below:

It is certainly easier to imagine the implication of a widespread disaster given the recent storm (Sandy) and subsequent snow storm that plagued the Northeast even if you were not directly impacted or in our immediate area. As of this writing many in the Northeast continue to be without power and whole communities will not be able to return to their homes for months to come.

Business Continuity is a risk to be considered carefully. Not only the physical (direct) damage an event can cause, but the lingering (indirect) effects of such event. Loss of services, loss of income and potential loss of customers are all risks that must be looked at thoroughly.

Insurance can mitigate the effect of these risks but not eliminate them. Many businesses simply cannot close their doors for an extended period of time and hope to reopen again. According to the Institute for Business and Home Safety an estimated 25% of businesses do not reopen following a major disaster.

Now is the time to put DRP/BCP on your 2013 priority list. It will help you forecast a lower Total Cost of Risk (TCoR) and add stability to your strategic planning.

If we can help facilitate a workshop with your key staffers toward creation of a Disaster Recovery, please contact me at or at 732.395.4251.


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Featured Article

Albert Sica, Managing Principal, identifies the key risk management initiatives and issues organizations should be thinking about in 2017.