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Insurers can boost port security: Consultant

Insurers can boost port security: Consultant

WASHINGTON--The private sector has a key role to play in enhancing port security against terrorism, according to a terrorism and security expert.

But "security is seen as a cost, not as a benefit," J. Michael Barrett told an audience of policymakers and others during a discussion of port security at the American Enterprise Institute in Washington last week. "I think that's got to change," said Mr. Barrett, who is president of Counterpoint Associates, an Annapolis, Md.-based security and disaster preparedness consultant.

Mr. Barrett said one way to change that perception would be to reward companies that invest in port security. For example, shippers that stress security should receive better rates from their insurers than those that do not, he said. Even a small reduction in rates could mean significant savings over several years during which terrorism is a major concern, he said.

Mr. Barrett pointed out that between 85% and 90% of U.S. port facilities are privately owned, which gives private companies a considerable stake in assuring that terrorists do not use ports as targets and gateways. In dealing with terrorism, businesses have to look at what they care about deeply, issues such as protecting assets and what he called "brand equity," according to Mr. Barrett.

"Nobody wants to be the shipping company that let" a ship carrying a terrorist-controlled nuclear weapon arrive, he said.

"Where does a company derive benefit and value" from taking adequate security measures? Mr. Barrett asked.

In addition to receiving lower insurance rates, companies that pursue security should be rewarded by investors, he said. Taking security seriously may mean that a company will be able to maintain operations while its less security-conscious competitors struggle to get up and running after an attack.

In addition, companies should establish a relationship with business partners that requires security consciousness on the partners' part as well, he said. That will help protect against disruptions.

Mr. Barrett was one of four speakers at the symposium, each of whom took a different approach to the issue of port security, although he was the only one who focused on the private rather than public sector role in dealing with the issue.