0 ERICAN The Publication for Insurance Agency Succes ~j~J:uh1tt1G1IiF Letters Down to Cases For the Manager Policy Issues Study Sales Automation What's Going On New Policies Technology Update 0 Articles Subscribe Products Conferences My Account About Us Contact Us Ad I' L i~'i Arranging insurance for health clubs by James L Foley, CPCU Health clubs are great kr our agency's fiscal fitness. AT IriterWest Insurance Services we've found that health clubs are great for our Advertiser Index agency's fiscal fitness. Using an insurance package geared to this niche, we~e built An Agent's Guide to Web a book of some 400 clubs. Furthermore, the outook for our specialty is bright Sites Fitness-conscious baby boorners continue to be heavy users of health dubs. Meanwhile parents, aware that many schools are curbing their physical education An Agent's Guide to programs are enrolling their children in health clubs. Aware of such trends, the Automation and International Health, Racquet and Spoc-tsclub Association (IHRSA) has a goal of Technology getting 50 million people into its members' clubs by 2010, That would require the Advertised Products industry's 17,000 commercial health clubs to expand to about 25.000. Market and ServiceProvider Directories Things weren't always so rosy for this niche. When InterWest started worldng with Industry Organizations health clubs back in 1984, the industry did not have the best reputation- Some clubs Calendar of Events would open in strip malls, heavily promote the sale of annual or even lifetime Agents Guide to Programs memberships, then fold six moths later-without refunding any of the membership fees. In California, health dubs were one of the top sources of complaints to the Other Insurance Websites 8etter Business Bureau. As the hard market hit clubs across the board had a Submit a Topic difficult time getting coverage and were relegated to the surplus-lines market Calculators In this environment however, our agency saw an opportunity. We knew the better clubs were competing for business by offering monthly memberships, which provided patrons with greater convenience and shielded them from the financial risk of long-term membership contracts. These tended to be owner-managed clubs that held memberships in organizations like IHRSA Unlike the 'fly-by-night\" dubs, they also had a substantial investment in exercise equipment and such facilities as swimming pools and racquet-ball courts. To us, they looked like pretty good risks, and we put together a customized program for them and placed it with lndustiial Indemnity Co. We called the program FitriessPak and copyrighted the name. Today, we place the program with TIC Insurance through K&K Insurance Group, which has given us an exclusive in the health-dub niche in 10 Western states. We continue to write most of the business ourselves (I'm one of three producers for the program, along with ken Mckay and Steve Azevedo), although we also have a small amount of brokerage business, Our program is quite broad. For property exposures, it includes business income, http://www.agentandbroker.com/FSG/AgentB roker/MaiflNaVIArtiCIeS/ArCh1%H~th'~L 8/912002 leasehold improvement and ordinance or law coverage. For liability, it covers premises, products, liquor, nonowned auto, employee benefits E&O and some ) I' professional practices, employee dishonesty, tanning services, and autos, employment liability exposures. Options include coverage for ownedflood and earthquake. Under a separate policy, again placed through K&K insurance, we can provide workers compensation insurance. also We have a separate program that provides professional and general liability insurance for personal trainers and fitness instructors. It is endorsed by the American Council on Exercise, the nation's leading certification body in its field. Available limits range from $500,000 to $5 million. Through the association, we insure some 4,500 trainers and instructors, who pay annual premiums ranging from$124 to $231. They receive individual certificates off a master group policy written for the program. Prospecting Most of our business comes from referrals and from our involvement with associations, both the IHRSA and state health club associations in California and the Pacific Northwest. We have the endorsement of these associations and pay them a small override on business sold to their members, Each risk is individually undeiwritten, however we have no obligation to insure an association member that does not meet our underwriting criteria. While we already know most of the established dubs in our marketing territory, we learn of new clubs primarily through our relationships with the associations. The associations also are our chief vehicle for promoting ourselves to clients and prospects. We exhibit at the associations' conventions and contTibute articles to their publications. ) When we meet with prospects, we naturally hope to obtain their business. But if we don't, we at least want to make a good impression and build our credibility, because there's always next year. Consequently, we are happy to quote and don't require the prospect to give us some sort of upfront commitment. Since we're going to only one market quoting is not an expensive proposition for us, and we dose 50% of our proposals anyway. So we don't push too hard. Wien prospects turn down our proposals, we invite them to call us anyway for advice on risk management or other subjects. By taking this tack, we often eventually win a prospect's business after the client experiences an uncovered claim or encounters some other problem. When gathering information about a club, one of the first things we ask to see is its membership agreement. Such agreements typically indude waivers and assumption-of-risk language that have been supported by case law in practically every state. We've had a nationally known expert in waiver language prepare a handbook on This subject for us. We mail it to all our clients and sometimes give it to prospects. While being careful to point out that we're not lawyers, we suggest that the clubs show the handbook to their counsel for possible use in drafting or strengthening a membership agreement While membership agreements are great for transferring risks away from health dubs, claims still arise. How we deal with them is one important way that we differentiate ourselves from competitors. We turn such incidents over to an in-house claims department staffed by two people with a combined 25 years of experience in this niche. Our claims people are excellent at getting the club owner out of the middle of slip-and-fall claims and similar incidents. They contact the injured person and review the membership agreement's waiver language with him or her. Sometimes, an injured club member who either doesn't have health insurance or has a high deductible may decide to pursue a claim despite the waiver. Depending on the facts of the case, our claims department may conclude that it makes sense to use our med pay claims settlement authority. We can settle claims up to $1,000, which sometimes prevents a small incident from becoming a big claim. On larger claims, particularly property losses, our claims people are good at pointing out to adjusters where coverage exists in our program's forms. On liability losses, we fight the daims that we feel should be fought, but if we feel that our insured does not have a strong case, our claims people are adept at explaining as much to the dub owner and \"selling the settlement.' ~ 8/9/2002 Our claims people are key members of our team. They attend trade shows with us, where they always are greeted warmly by our clients. They help us gain accounts J and are a key factor in our high retention rate. Evaluating the risk We have a comprehensive survey form that we use to gather data for a submission. In regard to property exposures, we ensure that any kitchen areas have Ansul-type fire suppressions systems and that sprinlder systems are begin checked at proper intervals. For any dub situated in a building more than 25 years old, we like to see that the roofing, plumbing, wiring, etc. have been updated. Our program includes ordinance or law coverage, which means we need to take care in evaluating older buildings. While once inspecting a club in Los Angeles, we learned that the applicable ordinances could compel the club to erect a parking garage in the event of any loss that required the dub to obtain a building permit Rather than face the possibility that a $50000 kitchen fire could force our insurer to pay for a $1.5 million garage, we politely ended our solicitation. Our program covers business personal property for replacement cost. For even small health clubs, their investment in cardiovascular-fitness equipment often runs to $250000 or more. Sometimes we find a dub owner's estimation ci the value of this equipment is way off So we ask the owner to take the time to see what the equipment cost them and insure it accordingly In regard to liability exposures, swimming pools and Jacuzzis are always of major concern. The pools typically are used for such activities as lap swimming and water aerobics, rather than for recreational swimming. Private clubs with adult-only membership policies normally are not required to post lifeguards at the pools, but they are required to make periodic \"safety sweeps\" of the pools and such other areas as locker rooms, saunas and steam rooms. We ensure that these sweeps are being properly documented. Given that unfit people sometimes exercise too strenuously at clubs, heart attacks are not uncommon. In fact we experience five or six fatalities per year among the dubs we insure. The waiver language in the membership agreements again helps shield the clubs ftom liability, but we also require club staff members to be CPR qualified. Some clubs are now purchasing automated external defibrillators. Their use in emergencies is covered by a federal \"Good Samaritan statute, so they don't present an additional liability risk to the clubs. The nursery/daycare exposure is an important one that our program covers. Most health clubs have areas in wtiich children are watched while their parents exercise. The dubs usually are not required to be licensed as daycare facilities, since the chIldren generally are not kept for more than a couple of hours, and their parents are on premises. Nevertheless, we need to obtain detailed information about such mailers as how many children are typically present at onetime, how many staff people or volunteers are watching them, how these people have been screened, whether the attendants have CPR and first-aid training, etc. The application is quite detailed. In addition to the information cited above, it requests specifics on the maintenance of equipment, the use of signage to indicate the proper use of equipment and off-limit areas, a breakdown of receipts for the various products and services the dub sells, and the experience and qualifications of management and employees. In addition to the completed application, we obtain three-year hard copy loss runs and a copy of the dub's membership agreement for the submission. Occasionally, financial statements are required Wan underwriter's credit search turns up something questionable. Once an account is written, we stay in touch to provide any services the client might need. W~ile we don't tell clients how to run their clubs, we do often recommend that they purchase a copy of the American College of Sports Medicine's Health/Fitness Facilities Standards and Guidelines. We also distribute brief case studies drawn from our claims files. We publish this information in a newsletter, the Fitpak FIle, that we plan to start distributing electronically. http://www.agentandbroker.comffSG/AgefltBrOker/Maifl+~~4~t1des/ArchivefHe&th+CI ... 8/9/2002 You are in: Front Page News Headlines -> Companies Set to Increase Investment in Risk M anagement as Business Risks Grow, According to Nexia International Survey Risk Manage me nt Companies Set to Increase Investment in Risk Management as Business Risks Grow, According to Nexia International Survey Share Share Share Share Share Share 0 Companies Set to Increase Investment in Risk Management as Business Risks Grow, According to Nexia International Survey Publication Date Source: 12/21/2013 Investm ent Weekly New s Nexia International NEW YORK--(BUSINESS WIRE)--A global survey of companies and their professional advisers reveals that companies are set to invest more in risk management in the face of growing business risks, says Nexia International (Nexia), a leading network of independent accounting and consulting firms. Nexia's Global Risk Management Survey provides a unique combination of perspectives on current risk management practices among mid-market corporates, based on concurrent surveys of over 70 companies and more than 40 advisory firms around the world. Awareness of risk management is clearly on the increase. Almost half (48%) of companies surveyed expect to increase spending on risk management in the coming year. This is supported by the views of Nexia member firms surveyed - 63% expect the level of risk management services they provide to increase in the year ahead. Over half of Nexia member firms believe that the risk profile in their country has increased in the last year, reflecting current widespread political, economic and social uncertainties. Glenn Davis, Partner at Nexia International member firm CohnReznick LLP, says: "Risk management has become critically important as businesses are challenged to remain competitive while grappling with uncertain operational and financial conditions." Survey highlights: Almost half (48%) of companies surveyed expect spending on risk management to increase in the coming year. Over half (51%) of Nexia member firms believe the risk profile in their country has increased in the last year. Compliance and operational risks were ranked as the most significant among the companies surveyed. Two-thirds (67%) of participating companies have a formal risk assessment process in place, but a third (33%)rate these as only partially effective or lower. Over half (57%) of companies surveyed have yet to put a formal risk management training program in place 38% of companies say that risk tolerances are only reviewed annually or less frequently. Growing risks Overall, the companies surveyed ranked compliance and operational risk as the most significant risks facing their businesses. Respondents indicated that they are least prepared to deal with social media, succession planning, and natural or man-made disasters. Respondents also highlighted the risks surrounding global expansion as a key area. "Regardless of the size of the entity, the risks are broadly the same, but the ramifications are much greater for small and mid-sized organizations", says Davis. While two-thirds (67%) of participating companies reported that they have a formal risk assessment process in place, a third (33%) rated these as only partially effective or lower. A high proportion (24%) of companies reported being only partially effective, and a further 19% ineffective, in their use of IT to mitigate risk. Nexia member firms appear less confident in the effectiveness of their clients' risk management practices, with half of member firms believing that their clients are only partially effective in undertaking formal risk assessments. Risk management training The survey indicates growing recognition of the need for formal risk management training programs aimed at promoting awareness about risk within companies. Yet over half (57%) of companies surveyed have yet to put a formal training programme in place, and of those that have, a third (33%) believe that their effectiveness could be improved significantly. Nexia member firm respondents also appear less confident in the effectiveness of their clients' formal risk management training, with 61% rating it as only partially effective. Ownership and oversight On a more positive note, survey respondents indicate high levels of senior oversight and ownership of the risk management process. Nearly three-quarters (74%) of companies surveyed rated the involvement of senior management executives in discussions regarding risk management as effective or very effective. Two-thirds (64%) have a designated senior executive as the owner of the process, with another 14% in the process of doing so. "These survey results are encouraging," says Davis. "They demonstrate the active involvement of boards and business owners in the risk management process, providing reasonable oversight and largely engaging in discussions with the individual responsible for the risk management process." Where clients have a risk management process owner, 30% said that the person's role, responsibilities and authority were very well defined, while another 41% said that they were reasonably well defined. However, a quarter (25%) of Nexia firms said that only a "few" of their clients clearly define the risk management owner role. Risk tolerances It is reassuring that the risk tolerances of nearly two-thirds (62%) of companies are established by management and approved by the proper authority, although this leaves a substantial minority that do not follow this practice. Of those companies with a formal risk tolerance mechanism in place, 38% say that risk tolerances are only reviewed annually or less frequently. "Risk tolerances should serve as an ongoing guide to business managers to perform at optimal levels, but in a controlled manner," explains Davis. "Merely establishing and approving risk tolerances are insufficient safeguards - it's equally important to review them on a continual or frequent basis." For a full copy of Nexia International's Global Risk Management Report, please visit: http://nexia.com/assets/publications/Nexia-Global-Risk-Management-Report-web-Winter2013.pdf About our survey Nexia International's Global Risk Management Survey of business clients and member firms was conducted from April to June 2013. Respondents were senior employees of 73 small-to-medium sized public, private and not-for-profit entities across the world, from a wide range of business sectors. This was augmented by a concurrent survey of 41 Nexia member firms. The Global Risk Management Report on the survey findings provides a unique snapshot of risk management practices among predominantly mid-market businesses from around the world. It highlights current risk management challenges facing those businesses and provides insights into the latest risk management trends and solutions. It also includes a checklist of questions arising from the survey to help companies benchmark their current risk management practices. Note to editors: Nexia International is a leading worldwide network of independent accounting and consulting firms, providing a comprehensive portfolio of audit, accountancy, tax and advisory services. Nexia International does not deliver services in its own name or otherwise. Nexia International and its member firms are not part of a worldwide partnership. Nexia International does not accept any responsibility for the commission of any act, or omission to act by, or the liabilities of, any of its members. Each member firm within Nexia International is a separate legal entity. Nexia International does not accept liability for any loss arising from any action taken, or omission, on the basis of the content in this article or any documentation and external links provided. Professional advice should be obtained before acting or refraining from acting on the contents of this article. Any and all intellectual property rights subsisting in this document are, and shall continue to be, owned by (or licensed to) Nexia International Limited. References to Nexia or Nexia International are to Nexia International Limited. Our reports deliver fact-based news of research and discoveries from around the world. Copyright 2013, NewsRx LLC (c) 2013 Investment Weekly New s via VerticalNew s.com RMI 2101 Spring 2016 Homework 2 20 points Your Name Homework 1 2/9/2016 Your class time Due on Tuesday, February 9, 2016 AT THE BEGINNING OF YOUR CLASS 1. The Topic 2 article Companies Set to Increase Investment in Risk Management as Business Risks Grow mentions the importance of establishing \"risk tolerances\" of management within a firm. (Risk tolerances are another word for risk attitudes as discussed in class.) a. Identify one step in the risk management process where the risk attitude of managers and the firm would be important. Explain why risk attitudes would matter during this step in the process. [3 points] b. Identify one step in the risk management process where risk attitudes would be unimportant. Explain why risk attitudes would not matter during this step in the process. (This is not a trick question - there is at least one) [3 points] 2. Refer to the Topic 2 article Arranging Insurance for Health Clubs. Identify and briefly discuss TWO risk identification methods illustrated in this article. Make sure you state specifically what type of TRM risk (property, liability, net income, personnel) each method is seeking to identify. [4 points] 3. Refer to the Topic 3 article Risks Under the Big Top. Give an example of each one of the following TRM Risks faced by the circus and explain why your answer is an example of the risk [8 points]: Property Risk: Liability Risk: Net Income Risk: Personnel Risk: 4. Ben has a one-year lease on his apartment for $500 per month. All similar apartments in the area rent for $600 per month. If the apartment burns down at the end of month 4, what is Ben's total loss? Outline the components that make up this total loss. '79 U RISKS UNDER TRE I 1 S V JACK I AL LACE I ,.tfliTtPEZE ARTISTS FLY THROUGH ~ AIR ACROBATS TEETER ON ~wuIsuspended 40 feet lii the alt enter cages with snarling U~ ci St tot out of cannons. EIqfl rform handstands and other ~'flgUk1s. This is the risk world of Ringling Bratcd knmn a d.~kv Circus (Ringlfn~ there 'The Greatest Show on BmW .,cf ~ tying arr~r at azenie and ~c ap~nt tl~t : requirt n I~!t~%t fl*nne..1~.nt approach. Ever shi~ KT. ~m~a Crcm flncn ~d Mesiageris lr~d its first performance in lSfl. ~ L th~ ~ the na~ of the circus. Today, however. Ringffng'sciznn I tinfr maer~phisdcared operation than us predecnsor~ the Ringling circus now pr~enrs two separate units equal in scope and quality that simultaneously tour different pans of the United Stares. The circuses travel entirely by train, and each one visits approximately 41 cities per year, hauling their unique cargo of performers. their families, support staff, stage equipment and animals. Upon arrival in a given city, the circus must be up arid running within hours, and perfor mances are conducted with maximuffi concern for the safety of both per fornmrs and their audiences. Given the grueling travel and circus setup schedule, and the inhereru danger of the performances. Ringiiiig has made safety and risk management the highest priority. Purenin ni Puns Ringling's performers, consisting of some of the most capable performers from around the world. form a virtual United Nations of talent. However, the incredibly daring and dangerous feats executed by Ringling's per U Jack Waflace cs senior via president at Willis Corwon Corp of Nashvi&, IN. SI RISK MANAGEMe{r / AUGUsT 1994 5 0 formers are apparent in their risk. Among the hazardous and breathtak ing acts is the doublebarreled human cannon, which propels its two human cannonballs at an astonishing 5 Cs of force. Once airborne, the two travel at speeds of 65 miles per hour. and must choreograph their landings per fectly into a net 110 feet away or risk LflJUC7. The highwire act is also a Ringling mainstay and an act that can result in senous injury. Russian husband and wife team Alexandre \"Sash? Mednikov and Fatima Gadjkourba nova, along with their colleague lgor Arefiev. perform a spinetingling series of stunts, including one in which Igor carries the twoperson col umn of Faunia and [gor on his shoul ders until a blindfolded Sasha stands on the wire and launches into a back ward somersauLt. The act's inherent hazardousness is best illustrated by an incident that occurred in 1983 during a cerformance in Kazak'nstan while the', Were zertorrmng with a Russian arr,us. A bok broke off from the high wire apparatus. sending Sasha plum meting to the ground, fracturing his pelvis. Although doctors predicted the injury would end his career. Sasha fought back to full recovery, and six months later was once again on the wire. Ringling also features: trapeze acts by the Flying Vargas and the Flying Alvarez family troupes who have per fected their art over generations: The Boulibekov Riders, master horseriders from Kazakhstan; and an assortment of gymnasts and dancers. Each per forinance requires expert training and precise timing. For example. in one act Orinbasar Kurmanbaev of The Boulibekov Riders climbs off the horses saddle and slides under its belly, then crawls back onto the mount from the other side all while the horse is in lull gallop. A truly perilous feat, and in 20 years. Mr. Kurmanbaev has never fallen. Animal acts, of course, are an inte gral part of The Greatest Show on Earth.\" But when human perfonners mingle with animals such as cle phants. tigers and lions, danger lurks at every corner. Current Ringling ani 0 IL/q Tiff 811 lOP maL acts include the lion and elephant shows of Graham Thomas Chipperfield. Born into a family that owns the oldest circu in Britain, Mr. Chipperfield's lion act involves a number of perilous feats, including crouching in the lion cage as a 350 pound lioness Leaps over him. Mr. Chipperuield's elephant acts also involve several riveting tricks, but per haps none more exciting than the Terrifying Teeterboard Takeoff, in which one elephant strikes the teeter board with its foot, sending Mr. ChipperfieLd's somersaulting onto the back of another pachyderm. The teeterboard thck has not always gone smoothly, however, once, an elephant hit the teeterboard too had, sending Mr. ChipperfieLd's onto the ground with a broken ankle. Even with superbly trained animals, accidents can happen. One of Ringling's most unusuaL animal acts is performed by Chepiakova & Kim. a husband and wile team (eatunng trained bears that rtde horses! Onginated by Lvubov Chepiakova's mother and father in Kiev, Ukraine, decades ago, Lyubov and her Koreanborn husband Vilorik Kim are continuing an act in which bears weighing between 220 to 440 pounds climb onto the backs of hors es, race around the ring, jump through hoops and even perform handsprings. A S*rr Citus Given such acts, it is no surprise that injury is an everpresent risk in cirrus performing. However. Ringling's top management is fully aware of these risks as well as those associated with cirrus setup and teardown and the consequent need to maintain effective. fuWy developed safety and loss control programs. This emphasis on safety forms a key component of Ringling's corporate philosophy. In fact, when they purchased Ringling in 1967, Irvin and Israel reid declared that the saIe~y of Ringlin~s perform ers and support staff would be the company's highest priority; today, safety and risk management remain a centraL concern of the organization. where it has the full backing of Kenneth feld, Ringling's current owner, president and producer. Ringling, which works closely with its broker Willis Corroon. is regarded as having one of the lowest cLaim records in any industry. A regular fea ture of Ringling's nsk management philosophy is frequent brainstorrrung sessions with Willis Corroon's nsk management consuLtants that involve carefully analyzing all circus opera tions and procedures to continually improve the company's claims and risk control record. Ringling's insurance program uses high deductibles and selfinsured retentions, as well as thirdparty administrators for all lines. Ringling also has inhouse counsel that are very proactive in the liability area, a handson file management system. and a sophisticated medical manage ment program for workers' compen sation cases. Ensuring a safe circus for both performers and spectators requires support and technical empioyees expertly trained Lfl equip merit handling and maintenance, Ranging's support staff, whicri num bers approximately 150 employees per unit, is responsible for loading and unloading the circus trains, then setting up the rigging for each show, which includes tasks such as driving forklifts, hanging wires, ropes and cables from high elevations, and installing electricaL and lighting equipment all activities traditional ly associated with significant workers' compensation exposures. Ringling also operates its own prop shop in Sarasota, Florida, where inhouse staff create all props, decorative designs and embeLlishments for the circus wagons; the activities of the prop shop are incorporated into Ringlings risk management program. Setting up the circus takes between six and eight hours, and requires support employees to install approximateLy 25.000 yards of rope and rigging for each show, then check the torque of wires to ensure proper gauging. Maintenance staff must also confirm that all netting is correctly sited and that guide wires for aerial performers, or mechani calf in circus Lingo. are intact and TIE 0 3J~f Ill [OP Since pedonne~' lives direcily depend on the equipment used in their acts and since injuries are most often due to equipment failures before each show Aingling's pedor~e~ carefully test all nening, wirino and other appaia~ses to ensure each.piece of equipment is in pedect working order. Q accurately positioned. Since performers lives directly depend on the equipment used in their acts, before each show Riqgling's performers carefully test all netting. wiring and other apparatuses to ensure each piece of equipment is in perfect working order. Naturally, the safety of performers is paramount. so Ringling's safety program includes a variety of other strategies to reduce injuries and illness, including nucri cionists who have counseled perform ers on proper diet and the tmportance of body warmup exercises. beiore each show, and intensive safety train ing for dancers and gymnasts. As for Clown College, currently located in clowns, in 1968 Ringling founded Baraboo, Wisconsin. the home and origmal winter quarters of the five Ririgling brothers. At the college, aspiring clowns are instructed in the proper use of pyrotechnics, safety techniques for acrobatics and stilt walking, and the way to perform safe pratfalls. Overall, this emphasis on performer safety has helped keep per former accidents and injuries to a minimum. After an engagement, members of the support staff disassemble the rig ging a task that takes approximate ly two hours and then reload the trains. Since their activities encom pass the entire range of workers' com pensation exposures. Ringling's loss control program includes detailed safety procedures for all high risk activities, as well as safety training materials such as booklets. So far, these intensive programs have helped RingLing experience, over time, a workers' compensation rate modifier that dropped 60 points and is currently at an impressive rate of significantly less than 1.0. ''...~~..tNrr I At'ctst For Ringling, maintaining a safe circus would be impossible without including animal handling and train ing in its Loss control program, A typ ical Ringlirig show includes elephants. lions, tigers, bears, llamas, zebras, cameLs and horses. Obviously, aniniat care and training require the work of experts. Surprisingly, however, there are no universities or other educa tional institutions that'specialize in animal trW' g'. animal trainers devel op their skills based on timehonored techniques developed over decades and, an some cases, even centunes. Ringling utLlizes positive rein lorcement. a specific amma training regimen that is based on mutual trust and respect between the trainer and the animal. At Ringing, animal train ing always begins in the animal's infancy, and involves teaching the animal to perform alongside humans, as well as requiring that the difficulty of a given trick never exceed an aid rnal's abilities. The company also expressly forbids trainers to whip. beat, physically or verbally abuse or withhold food or nter from animals n training methods. To ensure the health and safety of the arilnials. Ringing maintains teams of trainers for each type of animal, a stablemaster, and a fulltime veteri narian and veterinaijan's assistant. As part of their normal care, Ringling's animals are given daily health inspec tions and exercise, proper diets, clean and exemplary housing conditions. and regular personal contact with people. Also, to deal with emergen cies. the company maintains veteri narians on call in each city where the show will tour. Ringling's animal safety program results in healthy, wellconditioned animals that enjoy longer lives than their counterparts in the wild. Ringing also provides 24hour secun cy for the animals, whether they are being housed, transported or perform ing. Also, since circus animaLs are a source of joy to spectators. many visi tors may be tempted to touch or pet an animaL. However, since touching of animals represents a possible public liability exposure. Ringling cordons animals off from the public, prior to. during and after a show, as well as during the traditional animal walk, when the circus marches the animals into town to Idck off an engagement. Since the natural habitat for many wiLd animals is gradually disappear ing, Ringling believes it can pLay a major roLe in the preservation and maintenance of animal species. En 1985. RingLing established an ele phant farm in central Florida where captive breeding progrims are used for performance animals. Earlier this year. two elephants named Romeo and juLiette, were born at the farm. For tts efforts. Ringling has received accolades from numerous animal groups for their experienced and humane treatment of exotic animals. Turns in Turn Besides maintaining safe operations during performances. Ringlirig's risk management program must also cover formidable transportation expo sures. Ringling has been transporting its circus by train since the lSTOs, and today operates the world's largest privately owned trains, each of which is 53 cars long, including 32 coach can, 17 equipment cars, and four stock can specially designed to maxi mize the animals' safety and comfort. Every week and sometimes twice a week each train travels to another city, hauling circus employees and their families, animals, wardrobes, sound equipment, props and conces sions. Since its entire performance opera tion is strictly dependent on traLn travel, transportation safety is an essentiaL component of Ringling's risk management program. To further the goals of transportation safety. Willis Corroon produced a train safety pro gram for Ringling including a safety 1994 7 5 C 0 video that discussed measures such as fire safety tips and warrungs about not walking between train cars, as well as safety booklets and other training measures The train safety program paid off earlier this year when the circus laced one of its worst disasters a [rain derailment in Flonda that killed two circus performers and displaced 88 employees for whom the company owned train is a yearround home. Two boys aged seven and 10 who rode in the same derailed car in which an elephant trainer was killed escaped by finding and removing an emergen cy window, to the amazement of adults who watched them emerge unharmed. When asked how they knew to come out through the safety window, the children said they had seen the process explained on the train safety video, which provided a detailed explanation of how to find the window and remove its rubber seal to push the window out. '.Vhen the tram accident .,ccurred. Ringiing and Willis Cartoon had a business continuity plan in place that greatly helped the company overcome the tragedy. Immediately after the crash, a disaster ollice was set up on site, and counsel,ors were hired to care for circus employees, their depen dents and animals. Mr. Feld, other senior company executives. Ringling's risk manager. 100 other company managers. adjusters and outside con sultants were at the scene within 24 hours to help performers and their families deal with any trauma they may have suffered. Within 72 hours of the accident, all personal property claims were settled, and the show was already back on the road. Since the accident was the first trainrelated fatality due to a derail ment at Ringling in more than 100 years. the company is convinced that trains remain the safest way to trans port its unique cargo of people. ani maLs and circus magic. This convic tion is based on the belief that if Ringling tried to transport the circus over the road in tracks, the potential for accidents 'would be far greater. Nevertheless, the accident demon strated that a crisis can strike at any time, thereby pointing out the necessi tyfor a sound business continuity plan. For Ringling, running a business with such a diverse array of exposures is a chaLlenge that requires a corpo race.wide commitment to safety and risk management. Since R.ingling's upper management provides this commitment, the company has been able to maintain highly safe operations that have aLso resulted in significant insurance cost reductions. These sav ings encompass all of Ringlings oper ations. including its two circuses, sev eral traveling Lce shows and a high tech Las Vegas show. In regard to risk management, then, Ringling Bros. and Barnum and Bailey Circus does not clown around. RN DOES SURVEILLANCE PAY OFF? ASK BILL KIZOREK: RE'S GOT THE EVIDENCE ~0 ,iaeiitc 1 Important Vide ~itc I. ~idMfl,~I' I ~enceL~ .~ lmporta V1d4 LfiiDcrtaaVId cleact .videnct 1 at Vid Evid~ I ~'in~~a yid~ EvId.nt~..] dence~~2~4J Evtden~~ Important VIdeo Ev~dencr 4~1 liii nwafl l9de After writing six bocks on surveillance and testifying, Bill, president of InPhoto Surveillance, has a lot of ideas on how to save indemnity dollars with effective use of surveillance. InPhoto has fulltime agents within a threehour drive of 85% of the U.S.A. population. For additional information call or fax: ~ ~l~.,pJi,S~ InPhoto Surveillance 8008224220 FAX 8007520720 Just PuSlihed: Greenhorn Wtnesi: The an 04 eaf~*~ in deosi~onS and court. Cast i $3.95 phas sIi~irig sit hanling. AuGusT 1994/ Risc MANAGn4CNr 47