The ALS Group Risk Management Articles

Yesterday, January 12, 2015, President Obama officially signed the legislation needed to reauthorize The Terrorism Reinsurance Act (TRIA).  Passage of the bill returns stability to insurers, policyholders and lenders after Congress adjourned and allowed the federal terrorism insurance backstop to expire.  The executed legislation does modify terms of the prior act.

On December 18 ACE Private Risk Services announced that they were acquiring the personal insurance business of Fireman’s Fund from Allianz SE. While this does not rise to the notoriety of Sony and North Korea, it is of particular interest to those who are written in the so called “high-net-worth” market category. Fireman’s Fund and ACE have two (now one) of the best personal lines programs out there. Other notable carriers are AIG Private Client Group, Chubb and PURE. All are vying for a share of the $1M+ dwelling homeowners market.

The global outbreak of the Ebola virus not only has long term social ramifications but economic ones as well.   Recently, this issue has become more and more prevalent on construction projects in developing nations.    When a local government considers a substantial construction project it is expecting certain economic outcomes to follow. In light of the Ebola crisis, risk managers of construction companies and material supply companies must now factor into their budgets the real likelihood of a project being delayed or shut down even after a substantial amount of funds have been expended.  A recent WSJ article, “Mining Projects Take Hit From Ebola Crisis”,  spoke about how major mining efforts

Construction accidents occur far too frequently, often due to inadequate safety measures. Earlier this month, an independent contractor was fatally struck by a falling tape measure at a new Jersey City high- rise. As reported here, by NJ.com, both OSHA and the building department of Jersey City will now be conducting investigations into the matter. Given the high rate of pedestrian foot traffic in the area, the parties involved should consider themselves lucky that it was not a bystander that was hurt.

As organizations increase their operations abroad, their supply chain risk also increases. A risk in doing business abroad is the reality that overseas supply chains are increasingly vulnerable to political uncertainties. According to a study reviewed by Zurich® Insurance, supply chain disruptions can cause an average 25 percent reduction in share price over two years. Can your company afford that risk? Other studies show that the stronger a company’s risk management practices, the more robust its growth. Those companies with “emerging risk practices” were less profitable, according to Zurich®. According to the American Quality and Productivity Center in a recent survey of 196 companies, 77 percent of the respondents experienced

It was interesting to stay at the Gaylord Opryland Hotel in Nashville, TN, while attending this year’s IRMI Construction Risk Conference. You see, the whole time we were there, the property was being dressed for the Christmas season. Garland, ribbons, lights, candy canes and brightly wrapped packages were being strategically placed throughout the hotel, as well as all over the grounds. And the biggest indoor tree I’ve ever seen was being erected right before our eyes. Apparently, this property is quite famous for its elaborate holiday décor. Click here to enjoy some photos from the conference.

As you may have heard, The ALS Group is attending the annual IRMI Construction Risk Conference in Nashville, TN.  I was happy to attend a workshop on Insuring Delay in Opening and Associated Costs, as the presenters hit on two of my pet peeves – declare all values at the beginning, before construction begins, and the contractor’s or construction manager’s fees (as part of its General Conditions) are included in the Hard Costs of the builder’s risk policy. Whether you are the owner/developer or the contractor buying Builder’s Risk coverage for a project, it is important that your values are detailed and reported up front.  It’s at the beginning, when