Tag Archives: Active shooter policies

Mass shooting insurance in high demand as U.S. emerges from lockdown

By Noor Zainab Hussain and Carolyn Cohn

(Reuters) – As normality filters back into American lives after a year of lockdowns, hospitals and other institutions are busy making provisions for one aspect of that old normal they would rather consign to the past – mass shootings.

Last year was the least deadly for U.S. mass shootings in a decade, a Reuters tally shows.

But spring has brought a resurgence and insurers are reporting a jump in demand for protection against such events, at a time when the pent-up traumas and frustrations of living through a pandemic are also re-entering the public domain.

Client inquiries for what the industry calls active shooter policies have risen 50% year on year in the past six weeks, said Tarique Nageer, Terrorism Placement Advisory Leader at Marsh, the world’s biggest insurance broker.

Such policies gained popularity in recent years following a spate of school shootings. They typically cover victim lawsuits, building repairs, legal fees, medical expenses and trauma counseling.

This year, however, even though fatal shootings in U.S. hospitals are comparatively rare and mass ones one-in-a-decade events, Nageer says demand has been particularly strong from the healthcare sector.

That finding is supported by Tim Davies, head of crisis management at Canopius, a Lloyd’s of London global specialty insurer.

Most hospitals are open to the public and their emergency wards, where patients with COVID-19 and other severe illness and injuries get treatment, can become triggers for potentially volatile behavior.

“Those are places where you could see people who are disgruntled that members of their family might have died and didn’t get a vaccine or weren’t treated properly,” Davies said.

Such concerns have led to an about 25% to 50% hike in active shooter insurance prices compared to last year for healthcare firms, while overall rates have remained steady, he said.

Chris Kirby, head of political violence cover at insurer Optio, said active shooter policy rates had risen by as much as 50% for some clients, without specifying any industry sector.

SCHOOLS AND CHURCHES TOO

Brokers say that, besides hospitals, retail establishments, schools, universities, restaurants and places of worship are other prominent clients, buying cover ranging from $1 million to as high as $75 million.

The United States witnessed 200 mass shootings in the first 132 days of this year, according to a report by the Gun Violence Archive, a non-profit research group that defines them as any event involving the shooting of four or more people other than the assailant.

Hart Brown, senior vice president of R3 Continuum, a crisis management consultancy that helps clients deal with the aftermaths of about 800 shootings a year, said violence had migrated from public spaces into homes in 2020.

But this year, demand for R3 Continuum’s services is up 15% to 20%, he says, with the gradual reopening of offices having brought violence back to the workplace – compounded by pandemic-induced stresses and economic insecurities often endured in isolation.

“The environment that was created by the pandemic, with the social distancing, the lockdown, and so forth and the compounding stressors is really what’s driving much of the violence that we’re seeing right now,” he said.

A survey by the Kaiser Family Foundation backs up that assessment, showing 41% of U.S. adults reporting symptoms of anxiety or depressive disorders in January, compared with 11% in the first half of 2019.

(Reporting by Noor Zainab Hussain in Bengaluru and Carolyn Cohn in London; Editing by Tomasz Janowski and John Stonestreet)

Insurance brokers new business: ‘active shooter’ policies for U.S. schools

A girl writes a note on a banner placed on the fence of the Marjory Stoneman Douglas High School to commemorate the victims of the mass shooting, in Parkland, Florida, U.S., February 21, 2018. REUTERS/Carlos Garcia Rawlins

By Suzanne Barlyn and Noor Zainab Hussain

(Reuters) – Insurance broker Paul Marshall can count on his phone ringing in the aftermath of a school shooting.

Since the Feb. 14 shooting at a Florida high school, where 17 people were killed and more than a dozen injured, seven South Florida school district have bought $3 million worth of “active shooter” coverage that Marshall’s Ohio-based employer, the McGowan Companies, began selling in 2016.

“Every day we get a phone call from another school district,” Marshall said.

The insurance, which is backed by XL Catlin  covers expenses tied to shootings in places such as office buildings and concert halls, and is increasingly gaining traction with schools. It pays up to $250,000 per shooting victim, for death and serious injuries, such as blindness or total disability, with additional medical coverage depending on how much insurance a district buys.

There is no detailed survey of insurance coverage at U.S. schools, but insurers say it is only within about the past year that more schools have been seeking “active shooter” and “active assailant” policies.

School districts often find that their general liability policies fall short on coverage for the cascade of bills that follow a violent incident like the mass shooting last month in Parkland, Florida, insurers and school administrators say.

The costs can include victim lawsuits, building repairs, legal fees, medical expenses and trauma counseling, as well as media consultants, accountants to handle charitable contributions, and even reconstruction of buildings where bloodshed occurred.

“This is a very sort of unique and specific issue that we are facing” Chris Parker, who heads a unit at Beazley PLC  that writes policies for political violence, terrorism and other risks, said about coverage for U.S. schools.

On Tuesday, a student who shot and critically wounded two fellow students at a Maryland high school died after exchanging gunfire with a campus security officer.

Marjory Stoneman Douglas High School, the site of the February shooting, is covered under a general liability policy through its local school district, which does not spell out whether shootings are covered, a spokeswoman said.

That was also true at Sandy Hook Elementary School, where a gunman killed 26 people in 2012. A wrongful death lawsuit filed by families of two children killed there seeking unspecified sums has dragged on since 2015.

In the case of public schools, state laws that exempt them from liability or limit the payouts can leave survivors and their families with huge medical expenses. Those laws can have exceptions and in some states, such as Florida, the legislature has authority to waive such limits.

Still, the process can take years and while school employees are generally covered through workers’ compensation insurance some shooter policies could help families meet some of the medical costs.

CROWDFUNDING FOR SURVIVORS

Some desperate families have turned to crowdfunding sites. For instance, Royer Borges is using GoFundMe to raise $1 million for his son Anthony, a Parkland student who has undergone eight surgeries since being shot five times during the massacre.

Anthony has insurance through a government sponsored-program for children, but it is unclear how much it will cover, his lawyer Alex Arreaza said.

The privately-owned McGowan Companies, fielded 10 times the number of queries in February about shooting coverage and inked three times more policies than a year before, according to Marshall.

Some coverage has been around since 2011, but more insurers, including Beazley, XL Catlin, Hiscox Ltd <HSX.L> have launched such policies since 2016, as mass shootings showed no sign of abating.

For example, insurance broker Jardine Lloyd Thompson Group  recently began selling coverage to help terror and mass shooting victims, including at schools, and a Munich unit in June began offering schools $100,000 in additional coverage for reimbursement of violent event expenses.

Premiums can range anywhere from $1,400 per year for $1 million in coverage for a small private school to $50,000-$100,000 for a $5 million to $10 million policy for a large public school district, industry executives said.

While one insurance executive described the market for school shooter policies as “embryonic” sales have been rising. As a result, premiums have come to about a third of what they cost two years ago, Marshall said. He is now developing a policy that covers construction costs for school districts that want to demolish buildings where shootings occurred.

In 2013, officials in Newtown, Connecticut, voted to tear down Sandy Hook Elementary School and the state gave the town $50 million for the new building.

A Florida school safety law signed on March 9 includes $25.3 million to replace the building at the Parkland high school where the shooting occurred.

Church Mutual Insurance Co in Merrill, Wisconsin, which insures private and religious schools nationwide, has been fielding calls from customers who want to raise coverage beyond the $50,000 per victim and up to $300,000 per violent incident it already offers through its general liability policies, said chief underwriting officer Ed Hancock.

Nate Walker, vice president of sales at insurance wholesaler Special Markets Insurance Consultants (SMIC), an AmWINS Group Inc unit, said the company considered a name change for its “Active Shooter Insurance Program,” offered since 2014 as part of a broader package aimed at schools, because it was a tough-sell.

“The more events that happened, the more we came to say there’s no reason to call this anything other than what it is,” Walker said. “You can’t really sugarcoat this.”

(Reporting by Suzanne Barlyn in New York and Noor Zainab Hussain in Bengaluru; Additional reporting Carolyn Cohn in London; Editing by Lauren Tara LaCapra and Tomasz Janowski)