28 November 2017, Bloomberg article speculates Mandalay Bay/Vegas concert massacre might cost over $1 billion in insurance payouts

Bloomberg writers Hannah Levitt and Sonali Basak penned the article, “Las Vegas Massacre Could Cost Insurers More Than $1 Billion,” on 10 November. To date, the exactitudes of insurance payouts, the companies involved, what policies did and did not cover, etc., are not forthcoming because it is too early in this sure-to-be contentious liabilities case. Nevertheless, Levitt and Basak offer insight into some of the pressing issues at stake. Highlights of the article are as follows: A multitude of lawsuits could drive the insurance bill for the Las Vegas massacre (called a “man-made disaster” by the insurance industry) to over $1 billion, and that they might continue for years The insurance sector this year (2017) has had to deal with a series of massive payouts, perhaps $130 billion, because of hurricanes, earthquakes, and wildfires, [and, therefore, it is likely to resist additional payouts…commentary here by … Continue reading

10 September 2017, Insurance AND legal issues impact Regency Hotel Dublin over Feb 2016 gangster attack

The assassination of Irish gangster David Byrne at the Regency Hotel Dublin on 5 February 2016 provides a textbook case study of hotel vs. insurance company wrangling over policies and payouts. The hotel suffered only slight physical damage from the attack, but business losses mounted, and the insurance company did not want to issue a payout. In the end, all parties lost out. The lesson here is that clear and decisive policies – especially regarding violence against hotels – can improve the insurer-client relationship, and justifiable payouts do not have to drown in a sea of litigation. The Regency Hotel Dublin (aka, The Regency Hotel) is a three-star, independent, family-run hotel. Its parent company is Regan Development Ltd. The hotel has a reputation as a lively, warm, and bright gathering place for sporting events, weddings, and other celebrations. The Regency website says it has … Continue reading

10 October 2016, UK Pool Re announces international terrorism risk pool forum

On 10 October, the Insurance Journal wrote that the UK’s government-backed Pool Re, which covers commercial property losses from terror attacks, had launched the International Forum of Terrorism Risk Re/Insurance Pools (IFTRIP.) IFTRIP is designed to build relationships and increase cooperation amongst other national pool res around the world. It was started in response to the dramatic increase in global terrorism. The Insurance Journal reported the following key points about IFTRIP: IFTRIP was formally launched on 10 October 2016 at the 2nd Annual Global Terrorism Risk Insurance Congress, hosted by the Australian Reinsurance Pool Corporation (ARPC,) Australia’s pool re, in Canberra The overarching goals of IFTRIP are to: 1) improve how the insurance sector reacts to terrorism, and 2) improve how nations protect their respective economies The presidency of IFTRIP will revolve on a yearly basis Francois Vilnet, Vice President of France’s pool … Continue reading

5 January 2016, Building premiums under review post Dubai hotel/apartment fire; might impact terrorism insurance

Following the major fire at The Address Downtown Dubai on New Year’s Eve, real estate community premiums in UAE are under review, and they might rise, reports The National. Two other 2015 skyscraper fires in Dubai are contributing to this possibility: one is the Regal office tower fire that happened in November, and the other is the Torch Tower fire that happened in February. None of these fires were reportedly suspicious or terrorist related, though three major building fires in a single year in Dubai do seem odd. Buildings with aluminum cladding panels, says Mohammed Hesham, Operations Manager of Capital Shield Insurance Brokers, is one reason for potential premium increases. “Cladding” refers to the outside surface of buildings. If the materials used for cladding are flammable, then the risk of damage and loss of life from accidental fire, arson, or terrorist bombing increases … Continue reading

14 July 2014, Commercial property coverage premiums come down – including terrorism coverage

Nancy Crotti recently wrote an illuminating article on the decrease of commercial property coverage premiums for Commercial Property Executive. This included terrorism coverage. Titled, Buyer’s Market – For Now, Ms. Crotti reports that buyers can expect an average 10% drop in premiums this year. Willis, she says, is estimating a drop of between 12.5 – 15% in its premiums. Crotti says the reasons for drop include: Fewer catastrophic weather events that destroy property Low property losses – meaning fewer payouts Hedge funds and other investors “chasing the yield” that has resulted in an influx of cash into this sector Increased competition, particularly from China and London Aggressive price drops by companies aiming to keep clients and market share Regarding terrorism, Crotti says that the U.S. Congress passing the Terrorism Risk Insurance Program Reauthorization Act of 2015 (TRIPRA, formerly “TRIA”) in January also has driven … Continue reading

29 July 2015, Main hospitality insurance points from Marsh’s venerable 2015 Terrorism Risk Insurance Report

Marsh recently published its 2015 Terrorism Risk Insurance Report, one of the top yearly terrorism insurance reports. Its statistical highlights regarding the Hospitality and Gaming sector are as follows: Terrorism Insurance Take-up Rates for Hospitality and Gaming 2014: 58% 2013: 60% 2012: 60% (See figure 6) Terrorism Insurance Pricing – Median Rates for Hospitality and Gaming (Rate per million) 2014: $32 2013: $22 2012: $41 (See figure 11) Terrorism Insurance Pricing as a Percentage of Property Premium for Hospitality and Gaming 2014: 5% 2013: 3% 2012: 7% (see figure 12) Marsh says that: “Compared with rates in 2013, median property terrorism insurance premiums decreased or stayed the same in 2014” for sectors such as “energy and mining, public entity and nonprofit, and life sciences…” Marsh also points out that: “Rates increased most significantly for media, hospitality and gaming, and construction organizations.” Sources and further … Continue reading

3 July 2015, Original content: hotel terrorism underwriting in East Africa – the same for North Africa in the wake of the Tunisia massacre?

…with expert commentary by ATI’s Sherry Kennedy and Souvik Banerjea  by Jeff Moore, PhD, with Tim Hill, 3 July 2015 (originally written in November 2014, slightly updated for June/July 2015) With the devastating 26 June terror attack on the Riu Imperial Marhaba Hotel in Sousse, Tunisia, hotel terrorism insurance all over Africa – and in scores of other regions – will be a hot topic for the rest of the year, and probably beyond. Terrorist and insurgent activity in Africa over the past 24 months has reached an alarming crescendo. Even when military operations by French, Kenyan, and Nigerian forces have beaten back these belligerents, they’ve found ways to resurface and attack in other areas. Aside from holding back millions of capable Africans thirsting for socio-economic advancement, terrorism and insurgency are wreaking havoc on Africa’s multi-billion dollar tourism sector, putting hotel terrorism underwriters increasingly under the gun. … Continue reading

9 May 2015, Kenya

Peter Muiruri wrote an interesting piece for Standard Digital, a Kenya news outlet, on what some business entities in Kenya are doing to salvage the 2015 tourist season that has been hit by terrorism and government travel warnings. His article, “Tourism industry players in Kenya welcome new terrorism cover,” says that AIG Kenya Insurance and Amref Flying Doctors have teamed up to provide tourists with inbound insurance coverage from terrorism exposure for their time in Kenya. The article quotes Mohammed Hersi, Chairman of the Kenya Coast Tourists Association, as saying, “The cover will open up the entire country’s tourism fraternity including areas prohibited by the travel advisories like the coast region and ensure tourist traffic flow is maintained. The Kenyan coast has been hard hit in recent times with the advisories resulting in low number of bookings.” How does this impact terrorism and … Continue reading

20 February 2015, Jeffrey D. DeBoer Comments on TRIA

Here is an interesting piece from 20 February 2015 including comments by Real Estate Roundtable President and CEO Jeffrey D. DeBoer on Congress passing TRIA and how a wide array of security risks to commercial real estate, including hotels, pose serious concerns as 2015 progresses: “Commercial Real Estate Conditions Remain Strong, Yet Outlook Softens Amid Global, Interest Rate, Policy Risks.” Copyright © Muir Analytics 2015

On 7 January 2015, TRIA passes the House

On 7 January 2015, reported the passage of the Terrorism Risk Insurance Act (TRIA): Hotel Industry Applauds House Passage of Terrorism Risk Insurance Act. The article said, “The American Hotel & Lodging Association (AH&LA) today praised the U.S. House of Representatives for passing legislation H.R. 26, Terrorism Risk Insurance Program Reauthorization Act of 2015.” TRIA was first passed by Congress in 2002 as a U.S. Government-sponsored, post 9-11 attack measure to strengthen terrorism insurance coverage purchased by corporations. Copyright © Muir Analytics 2015