Transcript The Risk Taker Roundup

The Risk Taker Roundup
Welcome
Mike Hay
Director of Risk Assessment and Loss Prevention /
Information Resources, State Office of Risk Management
Opening Remarks
Jonathan D. Bow
Executive Director and State Risk Manager
State Office of Risk Management
Introductions
Mike Hay
Director of Risk Assessment and Loss Prevention /
Information Resources, State Office of Risk Management
Kallman Consulting
Services
The Risk Taker Roundup
Conference Discussion
on
Employment Practices Liability
Hosted by the Texas
State Office of Risk Management
Phil Norton
President
Gallagher Strategic Risk Solutions
May 25, 2006
Employment Practices Liability:
The Exposure and its Trends
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Legal and Legislative Developments
Class Action EPL Claims
D&O Derivative Actions Following EPL Claims
Trends toward Catastrophic Loss
EPL Insurance Coverage Trends
Phil Norton – Arthur J. Gallagher & Co.
Factors Influencing EPL Losses
1. The Older Workers Benefit Protection Act of 1990 and The Age of
Discrimination in Employment Act of 1967
2. The Civil Rights Act of 1991
3. The American with Disabilities Act of 1990 (effective 1992)
4. The Family and Medical Leave Act (1993)
5. The U.S. Supreme Court decision in Harris versus Forklift Systems, Inc.
(November 3, 1993)
6. Class Action EPL Claims
7. Market Capitalization Drop
8. Derivative Action Possibilities
9. Typical Claims Costs are Significant
10. Catastrophic Claims are Becoming More Likely
Phil Norton – Arthur J. Gallagher & Co.
EPL Perils to consider
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Wrongful Termination (actual and constructive)
Breach of Employment Contract
Discrimination
Harassment (sexual and workplace)
Failure to Employ/Promote
Wrongful Discipline or Wrongful Demotion
Failure to Grant Tenure
Negligent Evaluation
Invasion of Privacy and False Imprisonment
Employment Related Misrepresentation
Defamation or Employment Related Libel/Slander
Wrongful Infliction of Emotional Distress
Retaliation (including whistleblower)
Phil Norton – Arthur J. Gallagher & Co.
Tracking EEOC Charge Filings
100000
90000
80000
70000
60000
50000
40000
30000
20000
10000
0
EEOC Charges
Race
Gender
1993
1995
1998
2000
Phil Norton – Arthur J. Gallagher & Co.
2002
2004
The Gallagher Database on EPL Claims
• Research on Public Information - not client data
• Focus on Large Losses - $1MM or more
– Approaching $5 Billion of Claim Costs in database
• All Losses are Post-1991 [Civil Rights Act]
• Mixture of Settlements and Verdicts
• Jurisdiction: half State Courts; half Federal
Phil Norton – Arthur J. Gallagher & Co.
Large EPL Claims By Industry
Energy & Utilities
14%
General Services
14%
Public Sector
10%
Retail
17%
Professional
12%
Financial
12%
Phil Norton – Arthur J. Gallagher & Co.
Manufacturing
21%
Large EPL Claims by Type of Claim
12%
Sexual Harassment
15%
Race Discrimination
7%
Disability & Other Discrimination
14%
Gender Discrimination
18%
Age Discrimination
7%
Whistle Blowers & Other Claims
20%
Wrongful Termination
7%
Retaliation
0%
4%
Phil Norton – Arthur J. Gallagher & Co.
8%
12%
16%
20%
24%
Top 10 States for Large EPL Claims
30
Note: numbers are percentages
10
6
6
4
CA
TX
NY
FL
Phil Norton – Arthur J. Gallagher & Co.
IL
NJ
4
MI
4
OH
4
DC
3
MA
3
Punitive Damages & EPL Claims
• About one-third of top $2.5 BL in large
losses are due to punitive damages
• Of largest 150 claims, about half have
punitive damages assigned
• Average percentage of full award that is
punitive is about 35% for all large losses,
but closer to 70%, if a punitive award is
present!
Phil Norton – Arthur J. Gallagher & Co.
Statutes & Law Supporting EPL Claims
Statutory
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Title VII
Age Discrimination in Employment Act
Americans with Disabilities Act
Pregnancy Discrimination Act
Equal Pay Act
Family and Medical Leave Act
Title IX
State Fair Employment Practice Statutes
Whistleblower Laws
Municipal Statutes and Regulations
Phil Norton – Arthur J. Gallagher & Co.
Common Law
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Breach of Contract
Wrongful Termination
Negligent and Intentional Infliction
of Emotional Distress
Defamation
Invasion of Privacy
Tortious Interference with Contract
Harassment
Assault and Battery
Negligent Hiring/Supervision
Fraud and Misrepresentation
Some EPL Cases of Significance
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Voice of America
CALPERS
Coca Cola
Texaco
State Farm
Interstate Brands
Lucky Stores
Shoney’s
Publix
Home Depot
Microsoft
Farmers Insurance
Phil Norton – Arthur J. Gallagher & Co.
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Denny’s
Miller Brewing
Triton Energy
Proctor & Gamble
Mitsubishi
Baker & McKenzie
Tishman Construction
General Dynamics
Hughes Aircraft
UPS
AT&T
Alabama DOT
Trends in EPL Insurance
• The EPL exposure, including potential for catastrophic loss, has
increased significantly since 1991
• Pricing started high (1992/1993) then declined (1997), rose again
(2001-2003) and is now declining again
• Meanwhile, EPL coverage has been greatly improved:
– sometimes packaged with Loss Control consulting
– punitive damages covered
– no downsizing exclusion
– bilateral discovery offered
– no “intentional acts” exclusion
– simpler reporting requirements often available
– flexible selection of defense firms may be possible
– third-party claim coverage
Phil Norton – Arthur J. Gallagher & Co.
The EPL Marketplace Today
• Cycle of Capacity starting to turn up
– 1992 to 1997, 1998 to 2003, 2004 - 2009…
• Until recently, Loss Ratios historically > 100%
• Carriers took action in 2003 with:
– Increased deductibles!
– Premium adjustments
– Coverage fine-tuning
Risk Management, Insurance and Loss Control are more important than ever!
Phil Norton – Arthur J. Gallagher & Co.
Responsibility for EP Compliance
90.0%
82.0%
80.0%
70.0%
60.0%
50.0%
40.0%
25.0%
30.0%
18.0%
20.0%
5.0%
2.0%
10.0%
0.0%
Human Resources
Legal
Risk Management
Phil Norton – Arthur J. Gallagher & Co.
Other
No One
Risk Evaluation and Loss Control
– comprehensive auditing systems may be available
– Prevention versus Reduction: Insurance is still key!
To prevent EPL claims, you
should review your:
* Hiring Processes
* Employee Procedures
* Training Programs
* Performance Evaluations
* Termination Policies
* HR Operations
Phil Norton – Arthur J. Gallagher & Co.
To reduce claims costs, you
should review your:
* Insurance and Risk Transfers
* Claims Investigation
* Claim File Management
* Defense Controls
* Timely Notification
* Return to Work Programs
Appendix
• Additional Information on EPL Risks
Phil Norton – Arthur J. Gallagher & Co.
The EPL Insurance Policy
• Who is covered?
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Directors & Officers
All Full-time Employees
Temporary Employees and Volunteers
Independent Contractors
The Corporate Entity and Subsidiaries
Students in a limited capacity
Phil Norton – Arthur J. Gallagher & Co.
Who can bring covered claims?
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Employees
Students
Applicants for hire
EEOC
State Agencies
Directors
Other individuals/entities acting on behalf
Phil Norton – Arthur J. Gallagher & Co.
Potential Exclusions
• Strikes, Lockouts
• Downsizing
• Willful or Malicious
Intent
• Willful failure to comply
with law
• M/A activity
• Bankruptcy
• Class Actions
Phil Norton – Arthur J. Gallagher & Co.
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Deliberate Fraud
W. A. R. N.
Benefits Due
Written or Express
Employment Contract
• Workers Comp.
Claims
• OSHA
• Securities Violations
Coverages to Request
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Punitive Damages
Back Pay
Front Pay
Pre/Post Judgment Interest
Nonmonetary or Injunctive Relief
Phil Norton – Arthur J. Gallagher & Co.
Coverage Triggers
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Written Demand for Monetary Damages
Civil Proceeding
Arbitration Proceeding
Administrative Proceeding
Phil Norton – Arthur J. Gallagher & Co.
Defense and Settlement Considerations
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Duty to Defend?
Panel Counsel?
Claims reporting threshold
Right to Settle (esp. Hammer Clause)
Reporting – When and How
Phil Norton – Arthur J. Gallagher & Co.
Rating EPL - The Exposure Base
• Number of Employees
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U.S. versus Foreign
Full-time versus Part-time
Leased Employees
By state (especially CA, TX, and MI)
Phil Norton – Arthur J. Gallagher & Co.
Other EPL Underwriting Factors
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The nature of the operations
EEO-1 report
Turnover
Percentage of highly paid employees
The quality of employment manuals and handbooks; the
stated positions on the key practices and procedures
Financial Condition
M&A Activity
Policy Wording Considerations
Approach to Risk Management
Litigation/Loss History - Claims experience is essential!
Phil Norton – Arthur J. Gallagher & Co.
Break
Public Officials Coverage /
Cyber Risk
Jean Moreau
AIG
Security & Privacy
Liability
Nick Economidis
Vice President
Professional Liability Division
AIG/National Union
215-255-6028
[email protected]
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Liability
Agenda
• Security & Privacy Exposures
• Traditional Policy Forms
• Security & Privacy Insurance Overview
• Questions
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
In the News…
2005 Disclosures of Data:
disclosed incidents in the United
States potentially affect more than
57 million individuals
Source: Identity Theft Resource Center
http://www.IDtheftcenter.org
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
In the News…
Data Breach
Identity Theft
Computer
Hacking
Stolen Laptop
Lost Backup tapes
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
In the News…
“The online trade in stolen
financial data is thriving.”
Countless Dens of Uncatchable Thieves
April 3, 2006
New York Times
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Typical Disclosure Incidents
• Bank
data theft: 700,000 exposed
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Typical Disclosure Incidents
• Major
retailer: $16.5 million charge for
losses due to a breach of computer
security
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Typical Disclosure Incidents
• Theft
of laptop containing employee
records
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Typical Disclosure Incidents
• Social Security Numbers disclosed on
mailing labels
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Typical Disclosure Incidents
• Website
allows access to restricted
information
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Typical Disclosure Incidents
• Financial
information obtained from
discarded records
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Key Exposures…
• Credit card information
• Healthcare information
• Personally identifiable information
- customers
- employees
• Business information of others
- Trade secrets
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Covered by Insurance?
• Commercial General Liability
• Bodily Injury and Property Damage
• Personal and Advertising Injury
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Covered by Insurance?
• Professional Liability
• In the performance of professional services?
• Personal injury exclusion?
• Dishonest acts exclusion?
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
• Negligent handling of private or confidential
information
• Legal Liability
- “Pay on Behalf of” basis
- Duty to defend
- Defense within limits
- Defense cost coverage for certain
regulatory actions (Subject to insurer’s
consent)
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
• Wrongful Act -• Failure of the insured’s (computer) security
• Wrongful disclosure by an insured of private
information
• An insured’s failure to protect private
information
• Vicarious liability of an insured for a failure to
protect personal information by vendors
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
• Key exclusions -• Dishonest Acts
- Officers or directors
- Employees (if officers/directors had knowledge)
• Misappropriation of trade secrets by an insured
• Contractual Liability
- Exception: obligation under a NDA Agreement
• Special Class Action Retention
• Greater of $100,000 or 200% of the standard retention
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
• Policy Limits
• Limits: up to $15 million available
• Retentions: start at $25,000
• Minimum Premium: $3,500
• Submission requirements
• AIG netAdvantage application
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
Policy application and materials
http://www.aignationalunion.com
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
• Who needs this?
• Financial Institutions
• Healthcare Providers
• Retailers
• Payment Processors
• Data Processors & Information Services
• anyone handling credit card information!
• anyone with employees!
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Security & Privacy Insurance!
A Perfect Fit for Every Company!
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Questions?
http://www.aignationalunion.com
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Thank you!
Policy application and materials
http://www.aignationalunion.com
Please drive safely on your way home!!!
Nick Economidis
[email protected]
215-255-6028
Insurance underwritten by member companies of American International Group, Inc.
Any description herein is a summary only. It does not include all terms, conditions and
exclusions of the policies described. Please refer to the actual policies for complete
details of coverages and exclusions. Coverage may not be available in all jurisdictions.
Issuance of coverage is subject to underwriting.
Lunch
Thank You to Our Sponsors
Risk Assessment & Loss Prevention
Mike Hay
Sam
Arant
Sally
Becker
Lisa
Bell
Joe
Deering
Risk Assessment & Loss Prevention
Cherie
Hughes
Mary
Loza
Lester
Taylor
Sam
Stone
Benny Vanden
Avond
SORM’s Insurance Program
• Directors’ and Officers’ Liability (Public
Official Liability) Statewide Program
• Short-Term Special Event General Liability
Program
• Statewide Automobile Insurance
• Volunteer Insurance Program
• Statewide Property Insurance
Thank You to Our Sponsors
RALP’s Services
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Accident/Incident Review and Analysis
Emergency Evacuation Program Development
Traffic Safety Programs
Education and Training Programs
Identification of Hazards and Employee Accident Exposures
Job Safety Analysis
Safety Inspection Programs
Back Injury Protection Training
Ergonomic Assessment and Training
First-Aid Program (Certification provided)
Hazard Communication Program (HAZCOM)
Hazardous Materials Management Program (HAZMAT)
Personal Protective Equipment Assessments
Industrial Hygiene Services
RALP Assists Agencies By:
• Identifying, evaluating, and reducing
potential liability exposures and liability
losses
• Reviewing risk management programs
used by state agencies
• Assisting state agencies to implement
effective risk management programs
RALP Accomplishes These
Services By:
• Providing risk management guidelines
• Administering on-site risk management program
reviews
• Administering safety evaluations, consultations,
and training
• Analyzing annual reports from state agencies on
loss information, existing and potential exposure
to loss, and estimates of category of risk of
losses incurred but not reported
• Providing agency outreach and training
Thank You to Our Sponsors
SORM 200
• The SORM 200 is the sole source for collecting
statewide information from state agencies regarding
their expenditures for risk management activities,
insurance purchases and non-workers’
compensation claims made or settled against the
agency.
• The intent of the SORM 200 is to capture costs
associated with agency Risk Management
Programs, and to compile information necessary for
SORM to include the administrative costs of risk in
the Office’s biennial report to the Legislature.
REPS
• The Risk Evaluation and Planning System (REPS) is a
data collection and analysis tool intended to assist state
agencies in identifying exposures to loss in various
operational areas. REPS is comprised of three major
sections. The “Risk Evaluation Survey” portion is
intended to lead client agencies through a series of
questions intended to identify exposures that could result
in financial or operational losses. The “Frequency and
Severity Analysis” portion of the survey calculates the
probability and potential impact of exposures identified in
the first section. The “Apply Mitigating Strategies”
portion recommends mitigating strategies to reduce or
eliminate losses from identified exposures.
Risk Management User Group
• The next meeting of the Risk Management User Group
is June 20, 2006, in the William B. Travis Building from
8:30 a.m.-12:30 p.m.
• Agenda items include:
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Emergency Responders Workers’ Compensation Consequences
Lessons Learned from Hurricane Rita
REPS Enhancements
Exposure Claims
How Insurance Works
Avian Flu
• For more information, contact Cherie Hughes at (512)
936-1483.
Thank You to Our Sponsors
Agency Outreach & Training
• SORM’s Agency Outreach & Training section
offers a variety of safety, health, risk management,
and workers’ compensation training for state
agencies.
• Popular courses include:
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Additional Duty Safety Officer (ADSO) Orientation
Adjuster Prelicensing Training
Confined Space Entry
Defensive Driving
Training for Claims Coordinators – Level 1
• Find out more by clicking on the “Outreach &
Training” tab at www.sorm.state.tx.us.
Risk-Tex Newsletter
• SORM’s quarterly newsletter keeps
State of Texas agencies up-to-date
on topics relating to risk
management, workers’
compensation, and training.
• To subscribe, send an email to
Risk-Tex Editor Sam Lawrence at
[email protected].
Basic Fleet
Risk Management for Public Entities
The purpose of this document and any activities to its creation
("The St. Paul Travelers Activities") was to develop current
underwriting information and/or to assist you with your legal
responsibility to maintain safe premises, practices, operations
and equipment. The St. Paul Travelers Activities do not cover
all possible hazardous conditions or unsafe acts that may
exist, are not legal advice, are not for the benefit of any other
party and do not amend, or otherwise affect the terms,
conditions or coverages of any insurance policy issued by The
St. Paul Travelers . Implementation of any practices suggested
by this document is at your sole discretion. The St. Paul
Travelers disclaims all warranties, express or implied and
assumes no liability to any party for any damages arising out
of or in connection with The St. Paul Travelers activities.
The Exposure
 Number ONE Cause of occupational fatalities
• 3,000-4,000 workers die each year
 A leading cause of work related injury
• 200,000 are disabled
• Costs average 3 X other injuries
 One of the most frequent accident causes
 One of the leading causes of third-party liability
claims
Components Of The Auto Exposure
Drivers
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Vehicles
Selection
Placement
Training
Accountability
Monitoring
Policies
Transfer
Selection and Placement
 Requirements – CDL Class?
 Experience counts
 50% of accidents happen to employees with 1 year or
less experience in a specific job
 Don’t hire “bad drivers”
 Background and MVR checks
 Physically and psychologically suited
 Drug testing
 Vision / hearing requirements
 Subject to ADA restrictions
Selection and Placement
“Negligent Entrustment”
 Hiring a driver without conducting a background
investigation
 Using a driver whose license is suspended or revoked
 Using a driver with a poor motor vehicle record
 Forcing (or allowing) a fatigued driver to operate a
vehicle
 Failing to address known alcohol or drug related
problems.
Selection and Placement
“MVR checks”
Who?
All Drivers
How?
State DMV/American Background
What?
Criteria
Where?
Personnel Office
When?
Hire/Continually/Annually
Why?
You Are Responsible
Selection and Placement
“MVR Grading Criteria”
 Minor violations
 Stop sign / traffic signal
offenses
 Speeding (not more than
20 mph over posted limit)
 Improper turn, failure to
signal
 Seat belt violation
 Illegal passing
 Major violations
 DUI alcohol / drugs
 Leaving scene of an
accident
 Reckless driving
 Falsifying an accident
report
 Vehicular homicide or
assault
 Attempt to elude an
officer
Grading Criteria (Three Years)
Violations
Grading Criteria
0 –1 Minor Violation
Clear
2 Minor Violations
Borderline
3 Minor Violations *
Poor
4 Minor Violations
Unsatisfactory
Any Major Violation
Unsatisfactory
* Trigger for remedial training
Selection and Placement
“Physical & Psychological “
 Law enforcement
psychological assessments
 NFPA driver / operator
recommended practices
 ADA issues
 Local Physical Requirements
 Vision/Hearing Test
 Doctors note
Selection and Placement
“Drug Testing”
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Pre-employment
For cause
Post accident
Random
 Safety sensitive
employees
 Security Sensitive
 D.O.T. requirements
 Union Contract
 Substance Criteria
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Prescription
Non-Prescription
Alcohol
Illegal
Selection and Placement
“Driver Test”
 Does a valid drivers license mean they can
operate the vehicle or equipment?
 Do you let law enforcement officers carry
weapons before they qualify?
 Require applicants demonstrate competence
before you let them operate a vehicle or piece of
equipment.
Driver Training
98% of accidents are caused by human behavior.
 Orientation training
 Specialized training
 Police cars
 Fire apparatus
 Ambulances
 Construction
equipment
 15 passenger vans
 Defensive driving
 FLI “Coaching” series
 Driver meetings
Accountability
 Accident investigation
 Reporting & documentation
 Determine preventability
 Accident review committee
 Consequences and rewards
 Charge-back (cost allocation) system.
 Retain Physical Damage by department
Driver Deductibles
 At fault accidents require driver to pay a set deductible
 Must be acknowledged by driver IN ADVANCE and IN
WRITING
 May not reduce pay below minimum wage
 Discuss this one with your attorney
Employee (Driver) File
 Application
 Background checks
 Medical records
(confidential)
 Drug and alcohol test
results
 Physical exams
 Road test (check ride)
 MVR
 Photocopy of license
 Training records
 Disciplinary records.
Components Of The Auto Exposure
Drivers
Vehicles
 Standardize The Fleet
 Performance and design
specifications
 Maintenance
Policies
Transfer
Inventory
 Don’t pay for
vehicles you don’t
own !
 Ensure that all of
your vehicles are
covered !
 Keep your
inventory up-todate.
Maintenance
 Scheduled preventive maintenance





Based on manufacturers recommendations
Vehicle history folder
Shop inspection reports
Repair orders
Shop software
 Vehicle condition reports
 Headlights, brake lights, warning equipment
 Fluid levels, tire air pressure, etc
Vehicle File
 Document:
 Purchase Date/Cost
 Driver Inspections
 Mechanics Inspections
 Defect Reports
 Manufacturers Defect
Reports
 Annual Inspections
 Maintenance Costs
 ALL MAINTENANCE
Components Of The Auto Exposure
Drivers
Vehicles
Policies
Transfer
 Government employees / due process
 Licensing requirement
 Driver qualifications
 Motor Vehicle Records criteria
 Personal use
Components Of The Auto Exposure
Drivers
Vehicles
Policies
Transfer
 Maintenance
 Personal vehicle use on city / county business
 Accidents & thefts
 General driver responsibilities
 Preventable accidents
Components Of The Auto Exposure
Drivers
Vehicles
 Hired & non-owned

Contractors

Volunteers

Certificates of Insurance
Policies
Transfer
Break
The Risk Taker Roundup
State Office of Risk Management
May 25, 2006
25 May 2006
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95
Disaster Planning & Recovery
Dr. James Kallman, ARM
Kallman Consulting Services
700 Furlong Dr
Austin, TX 78746-4127
631-748-0853
[email protected]
www.kcserm.com
25 May 2006
© Dr. James Kallman, ARM
96
Benefits of
Disaster Planning
 Save lives
& Recovery
 Minimize asset losses
 Contain recovery costs
 Minimize lost revenues
 Increase productivity
 Reduce regulatory problems
 Get back to business faster
25 May 2006
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Components of
Disaster Planning
& Recovery
Before: DPP – Disaster Preparation Plans
During: ERP – Emergency Response Plans
After:
25 May 2006
BCP – Business Continuity Plans
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98
DPP – Disaster Preparation Plans
1. Articulate your goals
2. Assess hazards
3. Assess current plans
4. Develop/revise ERP & BCP
5. Test the plans
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DPP – Disaster Preparation Plans
1. Articulate your goals
What do want to happen
after the event?
Is this a SMART goal?
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DPP – Disaster Preparation Plans
2. Assess the Hazards
a. Define “hazard”
b. Define “exposures”
c. Define “perils”
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DPP – Disaster Preparation Plans
2. Assess the Hazards
d. Assess impacts
e. Assess likelihood
f. Assess timing
time
P(x)
E(X)3
g. Describe the “risk”
E(X)2
E(X)1
25 May 2006
Expected values
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DPP – Disaster Preparation Plans
3. Assess Current Plans
a. Use the FEMA checklists†
b. How well are you prepared?
c. How often to review your plans?
†
FEMA – Emergency Management Guide for Business & Industry
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DPP – Disaster Preparation Plans
4. Prepare/revise Plans
a. Direction and Control
b. Communications
c. Life Safety
d. Asset Management
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DPP – Disaster Preparation Plans
4. Prepare/revise Plans
a. Direction and Control
1) Set up Emergency Operations Center
2) Appoint Incident Commander
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DPP – Disaster Preparation Plans
4. Prepare/revise Plans
b. Communications
1) Lists of key ER personnel
2) Set up teams
3) Create IT systems & back-ups (power too!)
4) Install warning systems
5) Appoint public relations spokesperson
6) Assemble hazardous materials information
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DPP – Disaster Preparation Plans
4. Prepare/revise Plans
c. Life Safety
1) Establish evacuation plan & assembly points
2) Create Search & Rescue plans
3) Arrange for security
4) Secure water, food, shelter
5) Prepare first aid stations & crews
6) Establish medical care & transportation
7) Obtain sanitation
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DPP – Disaster Preparation Plans
4. Prepare/revise Plans
d. Asset Management
1) Prepare budgets
2) Arrange for cash
3) Obtain security
4) Get back up power (test) and supplies (paper)
5) Prepare shut down schedules
6) Secure relocation sites
7) Contract for salvage / restoration services
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DPP – Disaster Preparation Plans
5. Test your plans
a. Tabletop exercises
b. Simulations
c. Full
interruption
tests
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
1. Direction & Control
2. Communications
3. Life Safety
4. Asset Management
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
1. Direction & Control
Activate Emergency Operations
Center
Distribute vital information
packets to key teams
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
2. Communications
a. Distribute Plan
b. Contact team leaders
c. Activate IT systems
(check back up systems)
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
2. Communications
d. Activate warning system
e. Initiate public relations
f. Distribute HazMat data
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
3. Life Safety
a. Site evacuation & assembly
b. Search and Rescue – employees and visitors
c. Provide first aid
d. Premises security (lock-out, tag-out)
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
3. Life Safety
e. Distribute water, food, shelter (families)
f. Follow up on medical care & transportation
g. Arrange for sanitation
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ERP – Emergency Response Plans
What will you do if the emergency occurs?
Activate ERP
4. Asset Management
a. Get Cash
b. Provide security
c. Implement back up power
d. Shut down / lockout / tagout
e. Obtain other supplies
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BCP – Business Continuity Plans
Let’s get back to normal
Issues:
a. What functions will you restore first?
b. How will you restore them?
c. What resources will you need?
d. How long will it take?
e. Who will do what?
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BCP – Business Continuity Plans
BCP Process:
1.
2.
3.
4.
5.
Articulate goals
Activate BCP teams
Distribute schedules & assignments
Obtain cash (Insurance / retention)
Set up temporary facilities
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BCP – Business Continuity Plans
BCP Process:
6. Get workers (families)
7. Contact external stakeholders
8. Employee rehabilitation
9. Initiate salvage operations
10. Initiate restoration activities
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Disaster Planning & Recovery
Summary
Before: DPP – Disaster Preparation Plans
During: ERP – Emergency Response Plans
After: BCP – Business Continuity Plans
Parting words of wisdom: Test your plans!
25 May 2006
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Disaster Planning & Recovery
Thank You!
Dr.
James Kallman, ARM
25 May 2006
© Dr. James Kallman, ARM
121
Thank You