Business Insurance | RIMS 2019 | Tuesday, April 30

Boston | April 28-May 1 TUESDAY 20 19 SHOW DAILY APRIL 30, 2019 Q&A: ANJA RITTLING Communicating across borders requires cultural understanding This year’s host chapter head talks BY GLORIA GONZALEZ about what she wants to get out of Cultural differences can Erin Meyer, Monday’s keynote speaker, is the author of “The Culture RIMS 2019, issues color perceptions of colleagues Map: Breaking Through the Invisible Boundaries of Global Business.” affecting risk and complicate working rela- managers in the tionships, but employees and shared reference points, so they possible, she said. region, including employers can take those dif- believe good professional com- In contrast, countries such as heightened catastrophe risks, and looks ferences into account to cre- munication must be very explic- forward to key sessions still to come at ate more positive interactions Japan with long histories tend the conference. across country borders, accord- “For Americans, the lowest- to be high context, meaning PAGE 6 ing to an expert on cultural context culture in the world, they assume they have shared mapping. the focus is on clarity, reference points, so their com- Medical marijuana specificity, transparency.” munication tends to be more poses problem Erin Meyer, author of “The implicit or nuanced, she said. in high-risk jobs Culture Map: Breaking Through Erin Meyer, professor, INSEAD When working with people in the Invisible Boundaries of high-context cultures, it’s best to BY GLORIA GONZALEZ Global Business” and a pro- it to deliver a clear, simplistic be less repetitive, ask clarifying fessor at Paris-based business message, she said. When work- questions and work on “reading Medical marijuana presents a school INSEAD, discussed her ing with low-context cultures, the air,” meaning understand- unique set of workplace safety research on culture mapping, people should be as explicit as ing the nuances of what people challenges for the construction which breaks differences down are saying, she said. sector, according to one expert. to eight behavioral scales — communicating, evaluating, See OPENING page 15 “I think it’s pretty clear that leading, deciding, trusting, dis- there are unequal risks among agreeing, scheduling and per- the industries,” said Matthew suading — during the opening Rodliff, regional claims manager, keynote address at the general construction for Liberty Mutual session on Monday. Insurance Co. in Weston, Mas- sachusetts. As an officer worker, “It’s not a question of looking at what individuals are like,” “If I stopped at the local dispen- she said. “It’s a question of sary on my way here, I might get understanding how we perceive a few more blank stares in the one another based on the big audience. I think my employer gaps on the scales.” might be pretty upset with me. But I’m probably not putting In the communication dimen- myself in danger, and I hope at sion, for example, Anglo-Saxon countries such as the United See MARIJUANA page 15 States generally tend to commu- nicate in a low context, meaning that they assume a low level of RIMS AWARDS FILLING THE GAP PHOTO GALLERY Goodell, Honor Roll, Parametric nat cat Snapshots from Heart of RIMS, more policies simplify claims conference events PAGE 3 PAGE 4 PAGE 10 Entire contents copyright by Business Insurance Holdings. All rights reserved.

Better Understood. Better Protected.™ We develop risk management Tuesday’s Speakers strategies and insurance solutions to help protect companies today Improved patient care via medical ridesharing: so they can focus on tomorrow. Worth the privacy and liability risks? Jeff Duncan, CUO, Healthcare, Liberty Mutual Welcome to what’s next — Kimberly Bailey, Esq., CRO, SCL Health from here, go anywhere. 11:00 a.m. – 12:00 p.m. | Room 156C The opioids crisis — how are states coping? Joseph Pachman, M.D., National Medical Director, Liberty Mutual 1:20 – 1:40 p.m. | Thought Leader Theater Some policies may be placed with a surplus lines insurer. Surplus lines insurers generally do not participate in state guaranty funds and coverage may only be obtained through duly licensed surplus lines brokers. © 2019 Liberty Mutual Insurance. Insurance underwritten by Liberty Mutual Insurance Co., Boston, MA, or its affiliates or subsidiaries. Proud supporter of RIMS, visit us at booth 733.

CONFERENCE COVERAGE | TUESDAY,APRIL30 Boston | April 28-May 1 Professional excellence honored at awards lunch BY ANGELA CHILDERS als for outstanding service and Harry and Dorothy Goodell Award: Debra Rodgers, center achievement, was presented to Dedication, giving back to the Debra Rodgers, retired senior try; and Deborah Luthi and the management at Walmart Inc. profession and the ability to vice president of global risk man- late William Mather were induct- Larry Glasser, president of the “walk the line” were the qualities agement at Aramark Corp. ed into the Risk Management highlighted by the Risk & Insur- Hall of Fame for their dedication RIMS Broward County, Florida, ance Management Society Inc. at Keesa Garcia, risk manager at to the profession. Chapter, accepted the Chapter the RIMS Awards and Recogni- NALS Apartment Homes in Port- of the Year Award, while RIMS tion Luncheon on Monday. land, Oregon, received the 2019 The J.D. Power Award for top chapters including the Arizona Rising Star Award; and Gordon performing insurer of 2018 went Central Chapter, the Central “Today’s risk professionals Adams, past president of the to Axa XL and was accepted by Texas Chapter, the Oregon are now expected to help their RIMS Orange County Chapter, Joseph Tocco, chief executive, Chapter and the Ontario Chap- organizations make brave deci- accepted the Ron Judd Heart of Americas. The Risk Management ter received Enhancing Chapter sions and confidently walk that RIMS Award and was credited by Honor Roll recipient was David Outcome Awards, known as the line,” said RIMS President Gloria RIMS as an innovator who helped Stills, vice president of global risk ECHO awards. Brosius. “No doubt risk profes- advance his chapter as president. sionals walk the line every day to enable their organizations to Gary Raymond, risk and insur- make great decisions.” ance leader at FedEx Ground, received the Richard W. Bland RIMS’ preeminent award, the Memorial Award, which is given Harry and Dorothy Goodell for excellence related to legisla- Award, which honors individu- tion and regulation in the indus- J.D. Power Award: Chapter of the Year: Ron Judd Heart of RIMS Award: Risk Management Honor Roll: Axa XL Broward County, Florida Gordon Adams David Stills, Walmart Richard W. Bland Memorial Award: Gary Raymond, RIMS Rising Star Award: Risk Management Hall of Fame: Mary Roth, Marcia center left; Barry Dillard, Disney, far right Keesa Garcia, center Mather, Steve Grabek, AIG, Deborah Luthi, Gloria Brosius BUSINESS INSURANCE RIMS 2019 3

Boston | April 28-May 1 CONFERENCE COVERAGE | TUESDAY,APRIL30 Parametric coverage seen as solution to policy gaps BY MATTHEW LERNER ness income and extra expens- policies, according to Mr. Nusslein. and, importantly, has few if any es from the event that are not “It’s a very formulaic insurance exclusions, with the only example Parametric insurance may covered by the policyholders given being “previously named offer businesses and organiza- traditional property insurance policy,” he said. “It has a payout storm,” meaning coverage cannot tions advantages not provided by program in its current form, or table and defined triggers.” be secured once a storm has been traditional insurance coverages, losses due to supply chain prob- named. according to Robert Nusslein, lems or damage to infrastructure One example of a payout table head of innovative risk solutions supporting the insured asset. could contain wind speed and Parametric coverage may also in New York for Swiss Re Corpo- corresponding payout levels be written as a derivative con- rate Solutions Ltd. “These are the gaps parametric that show increased limits as the tract but is frequently bound as an coverage are meant to fill,” Mr. intensity of the event increases, insurance policy, Mr. Nusslein said. Traditional insurance policies, Nusslein said. known as a “step-up” payout the forms for which have been table, Mr. Nusslein said. One key advantage of paramet- around for decades, work well for Parametric policies are quite dif- ric coverage is the transparent traditional brick-and-mortar, “old ferent from traditional insurance The policy can be very basic, claims process and quick payout, industry” assets but can leave perhaps only 10 to 12 pages long Mr. Nusslein said. gaps, he said, speaking during a session on Monday. If an event occurs that meets or exceeds the threshold in the pay- Coverage gaps in traditional out table, then a payment is usu- insurance coverage can include ally made within 30 days, with the non-physical damage business insurer serving as what is called interruption from a natural the “calculation agent.” catastrophe event, Mr. Nusslein said. Some period of time later, fre- quently after 12 months, the “You could have damage to the insured must make a simple, area, but not necessarily damage one-page certification that it had to insured assets,” he said. a loss greater than or equal to the amount the insurer had paid out, Losses could include lost busi- he said. Intangible assets remain underinsured: Aon report BY JUDY GREENWALD ty assets, specifically, would be ple have to start to understand for risk transfer of intellectual much higher,” according to Aon’s how to manage it, said Lewis Lee, property,” Mr. Lee said. Organizations need to improve 2019 Intangible Assets Financial Spokane, Washington-based CEO their understanding of infor- Statement Impact Comparison of IP Solutions at Aon. Despite the extent of cyber risk, mation assets’ value and insure Report, which was independently only 28% of respondents say their them accordingly, concludes a conducted by the Traverse City, But “intangible assets are defi- companies now have cyber cover- study sponsored by Aon PLC. Michigan-based Ponemon Insti- nitely underinsured based on age, and they report an average tute LLC. the findings of this report,” said limit of $17 million, according to The global survey of 2,348 indi- Nick Chmielewski, Aon’s Chica- the report. viduals who are involved in their Meanwhile, firms’ intangible go-based chief broking officer for company’s cyber risk manage- assets have grown immensely, IP Solutions. A total of 58% of the respon- ment and enterprise risk man- from $122 billion in 1975 to $25.03 dents who now have cyber cov- agement activities found that trillion in 2018, according to the The report’s overarching theme erage believe this level of insur- while 60% of the potential loss to report. Intangible assets encom- is “the insurance marketplace ance is sufficient with respect to property, plant and equipment is pass a wide variety of concepts, needs to adapt to become more coverage terms and conditions, covered by insurance, the poten- including intellectual property relevant to the modern age, and exclusions, retentions, limits and tial loss to information assets such as patents, marketing rights, create new insurance-based solu- insurer financial security, accord- covered by insurance is only 16%. goodwill, drilling rights, software tions to respond to the market ing to the report. The online survey was taken code, noncompete agreements need,” he said. between July 19 and Aug. 1, 2018. and customer relationships, Meanwhile, companies now can according to the study. Intellectual property, in partic- get property insurance coverage “Yet the return on investment ular, is “a massive market that’s if their building burns down, but to address intangible assets, in There has been a “massive par- being underserved, so the oppor- not if a trade secret goes out the general, and intellectual proper- adigm shift“ in business, and peo- tunities are very rich to develop door on a thumb drive, said Mr. more products and risk solutions Lee. “That needs to be changed.” 4 RIMS 2019 BUSINESS INSURANCE

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Boston | April 28-May 1 CONFERENCE COVERAGE | TUESDAY,APRIL30 Anja Rittling OCEAN SPRAY CRANBERRIES Anja Rittling is risk manager at Ocean Spray Cranberries Inc. in Lakeville, Massachusetts, and president of the Massachusetts chapter of the Risk & Insurance Management Society Inc., which is the host chapter of the 2019 RIMS annual conference and exhibition. She recently spoke with Business Insurance Reporter Claire Wilkinson about the conference and issues affecting risk managers in the Northeast. Edited excerpts follow. “There’s obviously an Q What are your goals for concern about climate in the to merge, but I think there are increased concern about this year’s conference? Northeast. We feel that on the still quite a few smaller brokers climate in the Northeast. property premium side because out there for the middle market We feel that on the property A Part of my goal as the pres- of all the (natural catastrophe) and the smaller companies. premium side because of all ident for the local chapter events that are happening at the (natural catastrophe) is to raise the participation of the national level. Thinking Q What opportunities events that are happening local risk managers. The net- of my own companies, we’ve does the conference at the national level ... it’s working aspect is what we are had a good loss history, we’re provide for students and hard to get good rates, and I there for. We want to provide implementing recommenda- young professionals? feel and hear that all over.” risk managers with learning tions where we can, and yet and networking opportunities. it’s hard to get good rates, and A RIMS is offering more for As a RIMS participant, this I feel and hear that all over. So graduates. For example, year I will focus on meeting I think, going forward, climate with the new RIMS-CRMP cer- with leaders in my industry will have a huge impact on risk tification, they can get special- from the retail, wholesale and managers, and we’re trying to ized in the field. It’s great that restaurant side of the house. figure out how to address that. we have awards for young pro- I’m hoping to meet some peers, fessionals. It’s a great venue exchange ideas, and learn what Q How do you see recent for them to get exposed to the they see as their risks in their mergers and acquisitions entire industry and have a specific companies. And then in the industry affecting chance to speak to the outside, the fun part is meeting up with risk managers? the underwriters, the brokers underwriters from Europe. I’m and the risk managers. lucky to be close to Boston. A With mergers and acqui- Most of my underwriters are in sitions there is always a Q What innovation and Boston or in New York, so I am change in personnel, and that is technology events at in contact with them on a regu- disruptive to the flow of infor- RIMS are you involved in? lar basis, so the meetings with mation. In terms of brokers and them will be more about enjoy- underwriters and their exper- A The insurtech competition. ing receptions and dinners. tise, there’s still plenty of choice I’m on the panel of judges out there. It might be a different for that. It’s a way for entre- Q What are some of the situation if Aon and Marsh were preneurs to get exposed to the key issues facing risk whole industry. I’m excited managers in the Northeast? about that — it’s something new, and it seems like fun. It’s A It depends on the industry. modeled after the “Shark Tank” Quite a few risk managers on TV. These kinds of events are thinking about marketing help us because we get to hear their programs more this year, about these companies and and I’ve heard more about the their products and what kind of need for working with captives positive effect or outcome that again. It may be because risk would have for a risk manager. managers are anticipating The risk managers must evalu- increased costs going forward. ate the product because we are There’s obviously an increased the customer in the end. 6 RIMS 2019 BUSINESS INSURANCE

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Boston | April 28-May 1 CONFERENCE COVERAGE | TUESDAY,APRIL30 Coverage plans can alleviate Brexit uncertainty BY GAVIN SOUTER REUTERS travel in Europe “so they have to now build in time to make sure Uncertainty over the terms of Anti-Brexit demonstrators protest outside the Britain’s Houses of they have a green card for their Britain’s exit from the Europe- Parliament earlier in April. driver, which causes increased an Union creates challenges for pressures on them,” she said. commercial insurance policy- & Nordics with Allianz Global services at BAE Systems PLC, holders, but advanced planning Corporate & Specialty SE in a Farnborough, England-based For all commercial coverages, can alleviate some concerns, a London. defense contractor. policyholders with international panel of experts said. programs – which provide consis- Freedom of Services allows Drivers from the U.K. would tency of coverage, lower costs and The United Kingdom voted to insurers registered in the EU have to secure extra evidence of ease of administration – should leave the EU in a close vote in “passporting” rights to cover coverage from their insurers by check with their insurers and bro- 2016, but negotiations over the risks based in other countries obtaining a “green card” before kers to make sure that the insur- terms of the exit have stalled. in the bloc without additional driving U.K.-registered vehicles ers on their programs have taken The U.K. government attempted licensing requirements, she said in EU countries, she said. action to ensure that they will still to negotiate a deal that would during a session Monday. be able to provide the programs give some certainty to future To obtain a green card, policy- after Brexit, said Su Briant, risk trade agreements, among other “You would be left potential- holders would have to apply to financing manager for shared ser- things, but the deal failed to win ly with two policies: one for the their insurers at least 14 days vices at BAE Systems. support in the country’s parlia- European countries and a sepa- before they travel, give details ment. The deadline for the U.K. rate one for the U.K.,” she said. of their itinerary and obtain a “We’ve asked (BAE’s insur- to agree to a deal has been post- physical green card or print out ers) whether they are already poned until Oct. 31. One issue affecting both person- an emailed green card on green established in Europe, are they al lines and commercial lines pol- paper, Ms. Cooper said. going to establish a third-coun- One of the key issues for policy- icyholders would be auto insur- try branch, do they need to or are holders if the U.K. leaves without ance, said Jacky Cooper, head Organizations often have they intending to take action to a deal would be the application of group insurable risk shared last-minute requirements to redomicile to Europe,” she said. of the EU’s Freedom of Services directive, said Ayleen Frete, BAE is confident that all its regional practice leader for U.K. insurers have completed the transition or are in the process of “The only thing that’s certain doing so, she said. is that the future is very While there are many business uncertainties surrounding Brex- uncertain … with insurance it, planning should ease concerns about insurance, said Ms. Cooper. there is some certainty there.” “The only thing that’s certain Jacky Cooper, BAE Systems PLC is that the future is very uncer- tain, but … at least dealing with insurance there is some certainty there,” she said. Data protection, flood cover top legislative agenda BY GLORIA GONZALEZ The U.S. House of Represen- although the House can poten- pean Union’s General Data Pro- tatives under the control of the tially stall some of President tection Regulation took effect Ensuring uniform require- Democrats “supports consumers Trump’s deregulatory agenda, in May 2018. California followed ments for businesses related to (and) retail investor protection regulatory change takes a long last year with a “GDPR-lite” law cybersecurity and data protec- and opposes Wall Street and big time, and ultimately it relies on that will take effect next year, tion and extending and reform- business,” Cari Miller, Rolling the heads of the agencies. But she noted. ing the National Flood Insurance Meadows, Illinois-based director don’t forget, the House controls Program sit at the top of the fed- and counsel for governmental impeachment and appropria- “It’s supposed to enhance pri- eral legislative agenda for the affairs at Gallagher Bassett Ser- tions bills, so they can still do a vacy protections for residents of Risk & Insurance Management vices Inc., said Monday during a lot of damage.” California and significantly limit Society Inc. thought leadership session. “And On the cyber front, the Euro- See WASHINGTON page 17 8 RIMS 2019 BUSINESS INSURANCE

SPONSOREDSECTION Customer-focused approach helps QBE differentiate Uwe Schoberth | Global Head of Market Management for QBE Insurance Group Uwe Schoberth, Global Head of Market Man- enhance customer engagement, and deliver a ing) experience to be as frictionless as possible. agement for QBE Insurance Group, recently sat consistent level of outstanding service across We’re here to help them explore innovative ways down to discuss the large international insurer’s our global footprint. to manage all of this, designing bespoke poli- investments to create a more unified customer cy forms, helping them form captives, creating experience, from sales through client services. Q. Tell us a bit more about the GMM team’s new products to transfer and manage emerging Australia-based QBE, one of the world’s major plans to enhance client and broker experience. risks, and so on. insurers, employs more than 12,000 people in A. We want client and distribution partners to 31 countries. The company recently launched come to us because they view QBE as a valued Q. An insurer’s reputation for innovation the Global Market Management (GMM) a new partner that delivers relevant insights, advice has become a crucial component in the ‘centre of excellence’, demonstrating a clear and support with industry leading tools and re- considerations of brokers and clients. statement that QBE puts the customer, including sources at different touchpoints—not just 30 Do you agree? clients and distribution partners, at the centre of days before the policy renewals. To make good A. Absolutely. Carriers must step up and be as everything it does. on this commitment, the GMM team will facili- innovative if not more so than the dozens of tate building a global framework that provides InsurTech startups that have raised nearly $5 Q. You recently were appointed to head up a easy access to all of QBE’s global capabilities billion over the past six years to reimagine insur- new organization within QBE—Global Market and resources. ance. In doing this, we must consider each cli- Management (GMM). Tell us about GMM and ent’s unique risk profile to provide more targeted its focus. But that’s only part of the picture. We want and innovative insurance products and services. A. GMM is a center of excellence comprised of to institutionalize the relationships we have more than two-dozen representatives drawn to- with customers, communicating with them on a Q. Technology offers a means to do that, gether from various company and functions like regular cadence to cultivate a closer and more of course. distribution, underwriting, claims and technolo- value-added relationship. A. That’s true but the important thing is data gy. The team’s mandate is to further embed a first, technology second. There has been an unified culture into QBE with a Global Customer Q. Is helping clients with their total cost of explosion in both internal and publicly available Commitment approach as the foundation. This risk a key GMM imperative? data, in addition to increasingly innovative soft- will be accomplished by collaborating with the A. It is, indeed. We perceive the GMM team as ware tools to collect and analyze this informa- Divisions to create consistent customer-centric an extension of our clients’ risk assessment tion for decision-making purposes. Underwriters practices and then replicating them across our and risk engineering practices. For example, using predictive analytics can better segment international operations. We believe the GMM if we see an exposure emerging, we’ll directly and price risks. Claims professionals can more team has the knowledge, experience and exper- engage brokers and risk managers to ensure easily detect possible fraud, reducing aggregate tise to move the needle on all our strategic prior- they’re mindful of this risk and potential mit- claims costs for the benefit of all policyholders. ities in 2019 and beyond. igation strategies. We want to become more Lastly, the analytics present a tremendous op- than an insurer in the traditional sense—to be portunity to ease and simplify interactions with Q. What was the impetus for forming this a trusted partner that really knows the clients’ customers, from sales and policy submission global team at this particular juncture in time? business models and operations, can identify through the filing of claims. A. Our industry is clearly at a crossroads. key risks to these processes, and, above all, can Competition is intense and growing, pressuring help them improve business resilience. Q. Will the GMM team be involved in a need for market differentiation. By investing in developing innovative cyber risk solutions to new technology tools like predictive analytics, we Q. Is it fair to say that QBE, through GMM, enhance clients’ risk resiliency? will be able to provide more efficient, seamless is developing a differentiating customer value A. Cyber security is of increasing concern for and frictionless experiences to current and proposition? businesses of every size, right around the world. prospective clients, helping us stand out in the A. I would say that we are looking to provide We plan to more closely align our technical re- increasingly crowded marketplace. Our view of more than traditional insurance products that sources to help risk managers better prepare for digital and data transformation is that it must transfer client risks. We want to help clients bet- cyber incidents and mitigate the outcomes. be driven by what is best for customers—not ter manage their total cost of risk—not just their just in the products we offer, but also how risk financing costs via insurance but also direct Many growing small and medium sized busi- we offer them. We are also working closely loss costs like retained risks and uninsured nesses, for whom data is central to their opera- with our distribution partners to identify joint losses, their indirect costs like reputation and tions, too often lack the resources to effectively opportunities for collaboration by leveraging the workforce morale, and even their taxes, admin- manage it. This creates significant risk. QBE al- best of our data and analytic strategic offerings istrative costs, and so on. With today’s market ready offer cyber-insurance in some regions, and which could create value for our mutual clients. volatility, clients want more options than a tra- through our partnership with Zeguro, we have The enhanced focus with our technology and ditional insurance product that transfers their the potential to augment our position globally, internal industry expertise will continually risks. Many clients are looking for coverages leveraging the power of Zeguro’s platform. strengthen our ability to simplify processes, tailored closely to their unique exposures and risk appetites. And they want the (insurance-buy- That’s just another benefit of our ‘working together’ approach.

Boston | April 28-May 1 CONFERENCE COVERAGE | TUESDAY,APRIL30 10 RIMS 2019 BUSINESS INSURANCE

CONFERENCE COVERAGE | TUESDAY,APRIL30 Boston | April 28-May 1 BUSINESS INSURANCE RIMS 2019 11

Boston | April 28-May 1 CONFERENCE COVERAGE | TUESDAY,APRIL30 HEARD ON THE STREET What is your top RENEE PETTINATO DAVE ARICK JONATHAN BREDEHOFT risk management MOSLEY Assistant treasurer, Director of risk management concern right Risk manager global risk management HCP Inc. now? City of Aurora, Colorado International Paper Co. Irvine, California Memphis, Tennessee “Cyber risk right now. We have a lot “My top risk concern right now is making of legacy systems we’re trying to “My biggest concern is probably sure we have the right protection in upgrade and some things that are how do we attract and retain talent. place … the right mitigation in place. really critical infrastructure to our IT You’ve got a lot of people who are And whatever we can’t protect against, programs … we’re really working hard approaching retirement age … how do we get insurance for it.” to get our cyber house in order.” we draw people to the industry and position it as a rewarding career and get them to stay in it over their careers?” TRUST. www.businessinsurance.com Risk management executives consider Business Insurance the #1 most credible brand.* BE A PART OF THE CONVERSATION ADVERTISE & SPONSOR: [email protected] SUBSCRIBE: businessinsurance.com/membership ATTEND: businessinsurance.com/events *Signet Media Preference Study 2015 12 RIMS 2019 BUSINESS INSURANCE

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CONFERENCE COVERAGE | TUESDAY,APRIL30 Boston | April 28-May 1 OPENING Luke Figora, the RIMS 2019 Risk Manager of the Year, oversees risk understanding of risk and their governance operations for Northwestern University in Evanston, Illinois. desire to go deeper into these top- Continued from page 1 ics. It’s forced us to professional- cer at Northwestern University, “I think the biggest change ize that much more. I think their The exception for typically as its 2019 Risk Manager of the that I would point to would be expectations continue to grow, low-context countries such as the Year. Mr. Figora oversees risk the increasing level of interest and our margins for error contin- United States comes in the con- governance operations and is and involvement of the board ue to shrink,” Mr. Figora said. text of giving negative feedback, responsible for the enterprise of trustees directly in risk and with U.S. managers taught to put risk management program of insurance,” he said of his expe- His risk management team par- a positive spin even when offer- the Evanston, Illinois-based uni- rience as a risk manager for a ticipated in the formation of the ing critical feedback to employ- versity, which has about 33,000 higher education institution over Northwestern Prison Education ees, she noted. students, faculty and staff and the past 10 years. Program at a local correctional generates about $2.5 billion in facility, sending faculty into the “It’s a very interesting and annual revenue. “I think the landscape of high- facility to teach. confusing pattern,” she said. For er education has expanded their “Americans, the lowest-context “I think working in higher edu- culture in the world, the focus is cation forces you to expand your on clarity, specificity, transparen- comfort zone a little bit,” he said. cy at all moments, except when it “In this specific case, the easy comes to speaking about some- answer would have been to say thing negative. It’s very confus- no. But I tried to take a different ing for people who come from perspective on it. I got out from other countries.” behind the desk and I spent a day with our faculty member and I Risk Manager of the Year saw the passion she had for the topic and the impact it could have Earlier in the session, RIMS on society. That made me focus honored Luke Figora, the senior on the upside of the risk and find associate vice president and a way to make it happen.” chief risk and compliance offi- RIMS also announced it would be make a $600,000 donation to the Spencer Foundation. MARIJUANA more medical marijuana being There is a contention that the injured workers, so it’s something used in construction than any federal Controlled Substances to think about when you’re think- Continued from page 1 other industry.” Act preempts state laws related ing about your policies.” to marijuana, she noted. that point I wouldn’t be putting Marijuana is a Schedule 1 drug In July 2018, the Massachusetts any of the crowd in danger.” under federal law, meaning that “It’s been raised a lot by those Supreme Court ruled that a com- it has no accepted medical use, in the insurer world,” Ms. Bick- pany that fired a worker who test- A study by the National Insti- has a lack of accepted safety ford said. “While that is true, it ed positive for marijuana even tute on Drug Abuse indicated levels for use under medical hasn’t been hugely successful as though she was authorized to use that employees who tested pos- supervision and has a high a legal argument.” it by her physician must face a itive for marijuana were 55% potential for abuse. There was claim of handicap discrimination more likely to have industrial the expectation that marijuana “Maybe in the construction in Cristina Barbuto v. Advantage accidents, 85% more likely to would be rescheduled under field we can argue that it’s Sales and Marketing LLC. have injuries attached to those the Obama administration, Lisa an undue burden to have accidents and 75% greater absen- Anne Bickford, Sacramento, Cal- impaired workers out there.” “I think this is pretty predictive teeism compared with those who ifornia-based director of workers of where we might be going,” tested negative, he noted. comp government relations for Matthew Rodliff, Liberty Mutual Mr. Rodliff said of the Massachu- Coventry Workers’ Comp Ser- setts decision. “The court went “Construction work involves vices, said during a separate ses- Employees who test positive for through a lot of maneuvering. not only the safety of the individ- sion, but it “didn’t happen, and marijuana may have a cause of They actually went out of their ual – they’re putting themselves now we have a different admin- action against their employers for way to say this wasn’t a federal at great risk a lot of the time … istration and a new sheriff in discrimination, she said. “That preemption issue.” operating heavy machinery – town,” she said. was not something that happened but it also puts their co-workers very often, and the case law was An employer has to make a rea- at risk and the general public,” The Trump administration was more favorable to risk manag- sonable accommodation unless it he said. “The nature of the work seeking public comment about ers,” she said. “That has shift- presents an undue burden, and that they do, lots of bending, the scheduling status of mari- ed. We’re starting to see more “I think maybe in the construc- twisting, lifting, pulling – it’s our juana, but the president has not court cases being held in favor of tion field we can argue that it’s an theory that you probably see taken a particular stance on this undue burden to have impaired issue, she said. workers out there operating heavy machinery,” he said. BUSINESS INSURANCE RIMS 2019 15

KEEPING RISK MANAGERS INFORMED FOR OVER 50 YEARS ARE YOU A MEMBER? RISK MANAGERS JOIN FOR FREE www.BusinessInsurance.com/Membership MEMBERS ACCESS THESE BENEFITS AND MORE… AUTHORITATIVE NEWS FLOOD COVER: Federal insurance program revamps risk analysis strategy - PAGE 4 AND IN-DEPTH ANALYSIS Written for executives APRIL 2019 concerned about the impact SPECIAL REPORT of risk on their business, RMIASNKAGEMENT INNOVATION PAGE 24 Business Insurance delivers news and analysis monthly in print and daily in online platforms. Customize your email preferences to directly receive news alerts that MACHINES matter most to you by topic, company and country. TACKLE RISK Artificial intelligence enhances efforts RANKINGS AND RESEARCH to comprehend, mitigate exposures PAGE 20 Rankings are published in Business Insurance magazine BUIN_Cover.indd 1 3/25/19 5:18 PM (print & online). Research reports and directories are available at a discounted member rate in PDF and Excel formats. EDUCATIONAL EVENTS Attend Business Insurance events to gain access to high-caliber educational content and network with industry peers and leaders. Visit www.BusinessInsurance.com/Events for a full schedule of events.

CONFERENCE COVERAGE | TUESDAY,APRIL30 Boston | April 28-May 1 Leaders must instill anti-harassment policies, culture BY CLAIRE WILKINSON when movie executive Harvey “The exposures and risks engaged leadership, consistent Weinstein was terminated from associated with not taking care and demonstrated accountability, Companies need to create a safe The Weinstein Co., he said. of these issues are very large,” trusted complaint policy proce- working environment for employ- he said, adding: “When you get dures and regular training are the ees as well as protect the organi- Mr. Weinstein faces allegations those big numbers, it’s setting the best ways for companies to pre- zation’s reputation and profits in of sexual harassment and assault expectations of the plaintiffs bar.” vent sexual harassment, he said. the face of growing sexual harass- from several women in the film ment claims in the #MeToo era, industry. “Every case is a Weinstein case, “It has to come from the top. an employment practices claims every case is multimillion dollar, There has to be a statement that expert says. “It was from that point that we making it very difficult to settle the culture of the company is not had a very high increase in (the the claim,” he said. going to tolerate sexual harass- Sexual harassment is a “very number of ) sexual harassment ment,” he said. serious issue,” said Dean Con- claims as well as severity. It start- Having a committed and stantine, senior vice president of ed to affect the way we deal with employment practices claims with each other and the way we do American International Group business,” Mr. Constantine said. Inc. in New York at a thought leadership session Monday. Employers face problems addressing the rising risk, he said. “The core characteristics of leadership, accountability, policy, Mr. Constantine cited a recent procedure and training, togeth- example of a California jury ver- er with a good program of insur- dict against a motion picture com- ance, can minimize or eliminate pany and its executive for sexual that risk,” Mr. Constantine said. battery. The turning point for the While the verdict was denied employment practices liability and is going to appeal, it was for market came in October 2017 $8 million in punitive damages and $3 million in compensatory damages, Mr. Constantine said. WASHINGTON REUTERS type of flooding or flash flooding in the past five years,” Ms. Mill- Continued from page 8 Democratic representatives will be voting on legislative items such as er said. “Disaster planning is a data security and extending the National Flood Insurance Program. central part of a risk manager’s how companies handle, store responsibility, but it’s very dif- and use consumer data, and that (for) businesses operating in Meanwhile, the NFIP has gone ficult to do when Congress has even though it’s similar to GDPR, multiple states, compliance with through a series of reauthoriza- not authorized long-term reau- it isn’t the same as GDPR,” Ms. a patchwork of nonuniform state tions, Ms. Miller said. thorization.” Miller said. “It’s only one state. requirements creates confusion It’s a big one, but it’s only one and lessens efficiency. The threat “Floods are one of the most The NFIP is currently sched- state. Other states are already of legal action and noncompliance common and one of the most uled to expire again on May 31. discussing their own versions of is why RIMS released a national destructive natural disasters, “It’s probably going to be another their GDPR-lite legislation. The standard for data security and and 90% of all natural disasters short-term (extension), but it’s a benefit of GDPR is that it encom- breach notification.” involve some type of flooding, big issue for RIMS and RIMS passes” all EU. and all 50 states have had some members, and RIMS supports a long-term reauthorization bill U.S. companies are already and discussions of long-term dealing with more than 50 breach reforms,” she said. notification laws that have differ- ent definitions and requirements, Another key upcoming issue Ms. Miller said. for risk managers is the Terror- ism Risk Insurance Act program, “How is a risk manager sup- which expires at the end of 2020. posed to do that?” she said. “Be on the lookout for that one as “How is a company supposed to well,” Ms. Miller said. do that and do that effectively? (For) RIMS, it’s one of their big “Pay attention to elections in agenda items. RIMS recognizes 2020,” she added. “They will impact our business and the risk management industry.” BUSINESS INSURANCE RIMS 2019 17

Boston | April 28-May 1 CONFERENCE COVERAGE | TUESDAY,APRIL30 AROUND THE HALL CEO Adam Potter RIMS COVERAGE ONLINE PUBLISHER Business Insurance is delivering online Keith Kenner daily news reports from the Risk & Insurance Management Society Inc. (Chicago) annual conference in Boston. [email protected] www.businessinsurance.com EDITOR 18 RIMS 2019 BUSINESS INSURANCE Gavin Souter (Chicago) [email protected] DEPUTY EDITOR Gloria Gonzalez (Washington) [email protected] SENIOR REPORTER Judy Greenwald (San Jose) [email protected] REPORTER Angela Childers (Chicago) [email protected] REPORTER Louise Esola (New Orleans) [email protected] REPORTER Matthew Lerner (New York) [email protected] REPORTER Claire Wilkinson (New York) [email protected] COPY CHIEF Katherine Downing (Chicago) [email protected] COPY EDITOR Brian Gaynor (Portland) [email protected] ART DIRECTOR Jeremy Werling (Cincinnati) [email protected] DIRECTOR OF RESEARCH, PLANNING AND INSIGHTS Andy Toh (Chicago) [email protected] MAJOR ACCOUNTS DIRECTOR - NORTHEASTERN U.S. & INTERNATIONAL Ron Kolgraf (Boston) [email protected] HEAD OF SALES - EVENTS & WORKERS COMP MAGAZINE Jeremy Campbell (Cincinnati) [email protected] DIGITAL AD OPERATIONS MANAGER Arielle Bassett (Chicago) [email protected] VICE PRESIDENT OF MARKETING Brian McGann (Buffalo) [email protected] DIRECTOR OF MARKETING & EVENTS Katie Kett (Portland) [email protected] MARKETING & EVENTS MANAGER Brittany Collins (Lafayette) [email protected] REPRINT SALES MANAGER Marie LaFerrara (New York) [email protected] SUBSCRIPTIONS & SINGLE COPY SALES [email protected] 954-449-0736 Copyright © 2019 by Business Insurance Holdings, 4343 Old Grand Ave., Suite 110, Gurnee, IL 60031. PHOTOS BY MICHAEL MARCOTTE

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