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DISASTER PLANNING AND INSURANCE DISCUSSION April 18, 2012 Presenter: Michael J. Brooks Executive Vice President Austin & Co., Inc. Host: Leonard Silverman.

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Presentation on theme: "DISASTER PLANNING AND INSURANCE DISCUSSION April 18, 2012 Presenter: Michael J. Brooks Executive Vice President Austin & Co., Inc. Host: Leonard Silverman."— Presentation transcript:

1 DISASTER PLANNING AND INSURANCE DISCUSSION April 18, 2012 Presenter: Michael J. Brooks Executive Vice President Austin & Co., Inc. Host: Leonard Silverman Executive Director Congregation Kehilath Jeshurun In Coordination with Yehuda Friedman Associate Director Department of Community Engagement, Orthodox Union

2 Top 2% of insurance firms nationwide, in terms of volume Niche focus- 250+ not for profit customers, often anchored by school’s 100+ Insurance carrier relationships Servicing customers from Montreal to Long Island to Buffalo since 1853 Employee owned, boutique firm

3 Risk to owned assets from property damage (Fire, Theft, etc.) Risk from liability-Being held legally liable for: ─Damaging the property of others ─Bodily injury to others ─Personal injury to others Keep in mind- PERSONAL liability potential for congregation members, volunteers, trustees, and employees RISK, AS WE DEFINE IT

4 Our Discussion- Ways to address Risk RISK TRANSFER (INSURANCE, CONTRACTUAL) PREPARE, REACT, RESPOND

5 House of Worship Risk Considerations: Why insurance underwriters “lose faith” Property Risks Building Age Antiquated Fire Protection Fine Arts Specialized Valuations Deferred Maintenance Unoccupied Bldgs. Cooking/ Social Events Historic Buildings Business Income Replacement Bldgs. Liability Risks Programming for Seniors and Community Slip/Fall Counseling Risks Schools Sexual Misconduct Transportation and Travel Athletics/Teams

6 Solid balance of insurance coverages, reaction agility, and recovery strategies Minimized pain (financial and otherwise) compared to similar size tragedies Congregation Kehilath Jeshurun- A tragedy done right?

7 Intensive, ongoing review of insurance program Board involvement, multi-departmental representation Solid administration of insurance documentation, appraisals, etc. Sound emergency response planning Informed, deliberate decision making about risk vs. cost of insurance Vendor relationships Congregation Kehilath Jeshurun- A tragedy well handled?

8 DISASTER PLANNING- NOT WHAT YOU THINK Comprehensive, all encompassing plan= 100’s of pages, $10’s of thousands in cost Requires a consultant Few outside of Fortune 500 have one Fog of War example Too many variables for detailed, granular plan More realistic- a RESPONSE plan (24, 48 hours), and a general road map after that

9 DISASTER PLANNING- WHAT I WOULD BE DOING- QUICK HITS! Big impact- Modest investment in time/admin Focus on what you can control, not the variables beyond your sphere of influence Adaptability/Agility One page of notes, a few hours of prep time =‘s MAJOR improvement in response

10 DISASTER PLANNING- WHAT I WOULD BE DOING- QUICK HITS! 1)Insurance- See separate discussion 2)Pre-Arrange/Pre-Screen Vendors: GC, Cleanup/Resto Company, Real Estate, Transportation, PR Firm, Architect, and…Public Adjuster 3)Building/Re-Building/Moving- Ask your board to consider now- what can they imagine doing? 4)Partners/Rivals/Other HOW’s- Handshake or more formal agreements for space. Long term and emergency.

11 DISASTER PLANNING- WHAT I WOULD BE DOING- QUICK HITS! (CONT.) 5)Communication- Social Media, a Youtube script and video, email contact of congregation and stakeholders, phone strategy, ops center, meeting space 6)Tech- Off Site Redundancy. Not just data back up, but can you operate while your building is burning? Need a vendor to assist? 7)Local 1 st Responders- Coffee is priceless

12 INSURANCE CHECKLIST- DOESN’T EVERYONE ENJOY THIS STUFF? SPECIALIZATION- Vendor selection is critical- Generalist? Commercial? CARRIER CHOICES- Litmus test- “A” or higher, NYS Insurance Dept “Admitted”, Lender requirements VALUATION- Appraisals- (RC vs FRC vs ACV), Historical/Landmarked FINE ARTS- Torah’s? Art work? Stained Glass, etc ORDINANCE AND LAW COVERAGE- New code compliance, consultant opinion? DEDUCTIBLE CHOICES- Annual discussion- Risk Tolerance? Buy Back Period? LIABILITY INSURANCE- Other variables, separate discussion

13 BUSINESS INTERRUPTION INSURANCE: OUR INDUSTRY AT ITS WORST… What is it?- Extra Expense, Loss of Operating/Net Profit How Can I Collect?- Must be triggered by a property claim first. How Much Should I Buy- Hardest insurance decision to make, bar none. Anchored by an educated guess, and endless variables Format?- A maze of “Actual Loss Sustained”, “Coinsurnace” 1/6 Monthly, Contingent, Dependent, etc Payroll Plan- Do you really intend to keep your Employees on the payroll while you rebuild? Can you replace them if you don’t? Different answer for different divisions- ie, schools.

14 PARTING SHOTS… Your agent/advisor choice is the most important choice that you make There is a limit to how much you can plan for specifically, but it is worth the energy to prepare generally Enterprise wide involvement spreads the decision/responsibility/resources/blame/credits Almost every one of you will deal with a truly major physical plant issue at some point in your career Monday morning QB’s are never wrong

15 QUESTIONS?… ?


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