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SAN DIEGO — Active shooter coverage available in the market can cover a wide variety of potential liabilities for employers whose workers, customers and others are impacted by such an incident, experts say.
Laura Zaroski, Chicago-based area senior vice president, law firms practice, for Arthur J. Gallagher & Co., said active shooter coverage, which primarily comes out of London, with a handful of domestic insurers, can include counseling, medical disability expenses for victims, funeral expenses, death benefits, and “loss of attraction” coverage, when a mass shooting results in a loss of revenue because people are no longer coming to the location of the incident.
She spoke during a session at the Professional Liability Underwriting Society’s conference in San Diego on Thursday as attendees were still absorbing the news of the shooting in a Thousand Oaks, California, bar Wednesday in which 12 victims and the gunman died.
Ms. Zaroski said other coverages include the cost of upgrading a building and its security, damages to a building, relocation costs and sometimes the cost of a teardown following an incident
Thomas Lookstein, New York-based head of financial and professional line claims for Starr Adjustment Services, a division of the Starr Cos., said one question that should be addressed is whether these policies have terrorism exclusions.
Marchelle M. Houston, senior vice president, bond and specialty insurance, for The Travelers Cos. Inc., said another potential claim is kidnap and ransom, where people are unable to leave a facility during an incident. You have to look at the host of allegations and policy terms and conditions to determine other insurance issues as well as exclusions, she said.
“We shouldn’t just be waiting for an event to do it for the first time,” said Ms. Zaroski also. “Let’s learn what to do and handle the situation before it arises.”
With the number of shooting incidents increasing, “more and more lawsuits are being brought against employers” in their wake, said Claudia A. Costa, a partner with Gordon Rees Scully Mansukhani LLP in New York, who moderated the session.
The U.S. Occupational Health and Safety Administration’s general duty clause states employers must have a place free of recognized hazards, and active shooting incidents are considered such a hazard, said Ms. Costa, adding her firm has been involved in defending some of these cases. Claims filed against employers in active shooter situations include negligence and failure to train workers, she said.
Other charges, she said, include negligent hiring and retention, which was an issue in the 2003 naval yard shooting in Washington that left 12 dead.
In that case, complaints from fellow employees that the shooter heard voices in his head were not addressed, and there had been a prior incident in which the shooter had shot through his ceiling to the apartment of a neighbor, she said. Bullying was cited as a factor in the 2015 San Bernardino shooting, in which 14 people were killed, said Ms. Costa.
Although it seems that workplace shootings have grown more common, the workers comp implications get little media attention.