Co-authored by Diana Shafter Gliedman
Now that the first cases of Ebola in the United States have been treated and the country is for the moment Ebola-free, it’s easier than two months ago to maintain perspective. Ebola is difficult to contract, and widespread outbreaks in the United States remain unlikely. That said, the risk of being affected by Ebola remains a significant concern for businesses across the country and worldwide— especially hospitality businesses.
While every business is concerned with the safety of its workers and customers, the hospitality industry in particular needs to take prudent measures to mitigate potential financial losses stemming from Ebola or other infectious disease outbreaks, including a thorough review of the coverage provided by existing insurance policies.
Some insurance brokers and insurance companies are rushing to market policies specifically designed to cover Ebola-related losses. Companies at risk may want to consider buying such coverage, but they should first closely analyze whether existing policies provide adequate coverage. These may include policies providing business interruption, workers’ compensation, general liability, and D&O coverage. Below, we consider each in turn.
Business Interruption
Typically purchased as a component of a business’s property insurance, business interruption coverage is designed to protect businesses against lost profits due to disruptions to their operations. Contingent business interruption coverage may apply to losses stemming from similar disruptions to a company’s suppliers or customers — but usually only if the underlying cause of damage is covered with respect to the policyholder’s own property.
In most property policies, business interruption coverage is triggered when the policyholder suffers physical damage to insured property. Physical damage, however, can include contamination. Moreover, some policies, particularly those written for policyholders in the hospitality industry, expressly provide coverage for losses stemming from infectious diseases without requiring other physical damage to property. Further, many property policies include civil authority coverage, which is triggered when authorities limit access to an area in which a business is located, even if there is no physical damage to the policyholder’s premises.
Some brokerages are rushing to introduce business interruption coverage specifically for Ebola — which may or may not be redundant for businesses with some provision for infectious disease coverage. At the same time, certain insurance companies are warning that they plan to introduce exclusions for Ebola related losses on new and renewed coverage sold to policyholders with increased risk of such losses. In this environment, it is a good idea to review existing polices to confirm the scope of coverage already in place for these risks.
Workers’ Compensation
Virtually every state’s workers’ compensation statute provides that an employee is entitled to benefits for what is known as an “occupational disease.” To constitute an “occupational disease,” two conditions must be met: (1) the disease must be due to causes and conditions that are characteristic of and peculiar to a particular trade, occupation or employment; and (2) the disease cannot be an ordinary disease of life, to which the general public is equally exposed outside of employment.
While occupational diseases are covered and ordinary diseases generally are not, there are circumstances where the latter may be covered if a direct causal connection to the workplace can be established. Because Ebola is generally contracted only through contact with an infected person’s bodily fluids, the question of whether a worker contracted the disease in the course of employment may be more clear than with other diseases.
Commercial General Liability and Directors & Officers Liability Insurance
Commercial general liability insurance is designed to cover against claims alleging that the policyholder’s conduct caused bodily injury to the claimant, such as sickness or disease resulting from exposure to harmful conditions. Since most claims by sickened non-employees fit this description, commercial general liability coverage is a key source of protection.
It is possible that individuals other than those personally sickened, e.g., shareholders in companies adversely affected by an outbreak, could bring claims against companies or their executives based on allegations that management’s acts or omissions caused such claimants to suffer financial losses. Directors’ and Officers’ policies may respond to such claims. Although most D&O policies contain exclusions for claims alleging bodily injury, claims for financial damages are covered under D&O insurance. In most cases, the bodily injury exclusions should not come into play in financial claims (though some broadly written exclusions may prove problematic).
Read the Policy
For each type of insurance, coverage may depend in large part on language specific to the policy. Risk managers are urged to conduct a coverage analysis now to determine what coverage exists and whether to consider changes or additions.
]]>This increase created a positive anticipation that 2014 would be the year in which normality returned to the tourism industry. In fact, the World Tourism Organisation had forecast up to a 6% growth in the number of travellers and the early signs were impressive. Many tour operators and booking agents experienced record sales in the early part of 2014. Unfortunately, a recent survey of more than 500 safari operators by Safaribookings.com found that they had experienced overall reductions of 20% to 70% when compared to 2013. The primary reason given for the sharp decline was “fear of contracting Ebola”.
The problem for various African countries is: despite the fact that the countries affected by Ebola – namely Sierra Leone, Liberia and Guinea – are closer to Europe than to East and Southern Africa, there are geographical misconceptions of tourism regions by potential tourists. They view Africa as one homogenous country and not as the second-largest continent, containing 55 recognised states. This false impression will ensure that the number of tourists will remain low, even to countries not affected by Ebola, until the disease is contained or public perception changes.
East Africa has been particularly impacted by tourists’ Ebola concerns, despite being more than 5 000km from the outbreak region. During August, the World Health Organisation issued a warning regarding Kenya having a high “possibility” of experiencing an outbreak, due to it being a major travel hub. However, to date, that country has not experienced a single incident. It is praiseworthy as well as noteworthy that international airports are highly vigilant in steps taken to prevent any spread across borders.
Morocco had been scheduled to host the African Cup of Nations Football tournament in January 2015. Due to Ebola concerns linked to the large influx of supporters from West Africa and the difficulty in controlling such numbers, Morocco cancelled the tournament.
Although it is likely that another country will host the tournament, this decision will have an impact on the Moroccan tourism industry because many in the tourism industry have taken advance payments for bookings. They have also assumed greater levels of debt in improving the services offered by hotels and lodges.
The employment expectations of locals have also been dealt a blow. The Cup of Nations event would have expected an opportunity of employment for at least the period of the competition and possibly even permanently, as sports tourists may elect to revisit the country at a later date. But those individuals are now unlikely to earn an income from tourism, which is a further impact of Ebola on individuals as well as on the Moroccan economy as a whole.
Insurance companies do provide an element of protection with respect to “contagious disease” being the cause of “business interruption”. However, this is generally limited to disease occurring within a specific radius to the affected business, lodge or hotel. It is highly likely that should Ebola not be contained in the West African region and spreads further, reinsurers might consider either specifically excluding Ebola, or entirely remove the contagious disease clause. Treaties are being renewed for the 2015 calendar year, and there is little doubt that this specific extension will come under scrutiny.
While Ebola has had an impact on the number of tourists cancelling or postponing scheduled trips to Africa as a whole, the impact of terrorism has been more localised to those countries directly affected. Nigeria, for example, has seen a decline in the number of visitors following the kidnapping of schoolgirls and that government’s perceived inability to adequately deal with that challenge.
However, the country that has been hardest hit is Kenya, following the bombings in Nairobi and terrorist attacks along the Kenyan coast. Although this has had an impact within the local economy, most tourists primarily visit Kenya for safaris. Those visitors who may have planned to visit Mombasa for the beach portion of their holiday are now switching to Zanzibar, the beautiful archipelago of islands off the coast of mainland Tanzania.
… new insurance risk insights needed
Fortunately, there have been no direct attacks on African hotels. However, the Taj Mahal Hotel in Mumbai, India, was severely impacted by a terrorist attack during 2008. To put matters into context, this does not mean that a single incident in India makes that country any less safe to visit than ever before. Equally, terrorism attacks in Africa merely demonstrate that there is no destination that can offer a guarantee of personal safety – and insurance needs to be carefully assessed in new and insightful ways.
Insurance does provide various products. For instance, Hollard Hospitality and Tourism provides War and Terrorism cover, as well as Kidnap and Ransom, and we have partnerships and representatives throughout the African continent. From an insurance point of view, it is extremely important to have sources for local risks as well as legislation and circumstances specific to each country.
Although our colleagues in Africa originally experienced interest in War and Terrorism, as well as Kidnap and Ransom cover, demand for this cover appears to have reduced. This seems to be due to the Somali pirates issue being largely addressed by a greater military presence in the region, including South African forces. There has also been a reduction in the number of kidnappings from oil bases in Nigeria.
For the present moment, this seems to suggest that the threat of terrorism within African countries, is not viewed as an immediate priority by either hotel owners or the African insurance industry.
However, all specialist underwriters and experts within Hollard Broker Markets who cover all categories of insurance, including Hospitality and Tourism, encourage brokers to keep alert to changes which can happen in a flash. We believe our intermediary network, particularly those who guide clients in the “movement-dependent” Tourism and Hospitality arena, are faced with the challenge of keeping totally abreast of changes that can happen overnight.
This is why at Hollard Hospitality and Tourism we make sure we have up-to-date risk information, available at all times, from our specialist underwriters and category experts. Our expertise is yours to give insightful guidance and help you to do the very best for your clients, wherever they are in the world.
]]>Although the risk of actually contracting EVD remains extremely low for most travelers and expatriates, serious ancillary risks have created significant travel and business disruptions -particularly in Guinea, Liberia, and Sierra Leone – for which many nations now recommend against nonessential travel. Other concerned African countries have taken additional measures to attempt to prevent importation of the disease by refusing entry to any traveler who has been in countries experiencing EVD outbreak within the previous 21 days.
Specific concerns are two-fold. The first concern is the rapidly increasing number of cases, which appear to be undeterred by extensive attempts at control measures (e.g., intense world health response; quarantine and isolation of confirmed patients, suspected cases, and contacts of those confirmed and suspected cases; treatment of the infected; intense screening activity at borders and points of entry/exit; application of experimental treatments; etc.), coupled with the continued circulation of rumors among local populations that medical practitioners are actually seeking to harm those at risk or infected, causing the sick to hide, flee, or even riot in some cases, thereby spreading the disease – potentially across borders. The second concern is that the operational and travel threat matrix in West Africa has increased exponentially, as those operating in the region may encounter border closures, strict security and health screenings when attempting to cross borders, a lack of goods and services as personnel – especially healthcare professionals – vacate for what they believe are “safer” areas, and the potential for quarantine. Additionally, many global and regional commercial air carriers have begun to suspend travel to the most affected areas. Recent guidelines provided by global health authorities and international partners, as well as nations who have implemented internal EVD protocols, have eased medical evacuations some, but air carrier service for providers, as well as intensive permissions necessary for transporting patients, are still a hindrance in many areas.
SummaryWest Africa EVD Outbreak
As of Sept. 5, international authorities have reported at least 3,970 EVD cases and more than 2,030 EVD deaths in West Africa. These include 823 EVD cases and 522 deaths in Guinea, including 621 confirmed cases; 1,839 EVD cases and 1,051 EVD deaths in Liberia, including 606 confirmed cases; 1,292 EVD cases and 452 EVD deaths in Sierra Leone, including 1,174 confirmed cases; 21 EVD cases and seven deaths in Nigeria, including 16 confirmed cases; and one confirmed case in Dakar, Senegal. As these figures demonstrate, the focus of EVD activity has shifted to Liberia and Sierra Leone since May, and persistent disease activity has finally led to the international exportation of infections to additional countries.
Whereas disease activity during the first wave of the outbreak March-May was centered in rural areas of southeast Guinea and northwest Liberia – with a significant focus in the city of Conakry with epidemiological links to southeast Guinea – disease activity has now shifted to include significant urban centers such as Freetown, Sierra Leone and Monrovia, Liberia, where quarantine facilities and treatment centers have been erected to render management options to a growing number of cases. Additionally, the Nigerian foci in Lagos and Port Harcourt – both populous centers of business – via the travel of infected individuals highlight the enormous challenges to the tracing of all contacts of potentially infected individuals and the prolonged isolation of potentially exposed individuals to prevent further spread of disease. In some locations, armed military escorts have been called upon to accompany the transport of high-risk patients to quarantine centers and to ensure the safety of healthcare personnel at these locations.
Media have reported significant numbers of healthcare workers abandoning their posts due to EVD concerns. For example, nurses at JFK Hospital in Monrovia called a strike Sept. 3 over lack of appropriate personal protective equipment (PPE). Although the Nigerian Ministry of Health was able to end the long-standing physician strike in Nigeria in an effort to address staffing needs in the wake of hundreds of isolated patient contacts and other clinical requirements, Guinea, Liberia, and Sierra Leone have not been as fortunate. The infection of several prominent physicians volunteering with aid organizations in the course of this crisis – as well as multiple local national doctors, nurses, and ancillary staff – has led to several violent incidents targeting local government offices and hospitals treating EVD patients. Increased security has been provided to facilities and towns to discourage protests and mass gatherings, which can also facilitate disease spread, and governmental and non-governmental officials have promised increased protection through more personal protective equipment (PPE) and cleansing materials. However, after a UN staff member contracted EVD and necessitated medical evacuation to Germany, the WHO removed more than 60 staff members from Sierra Leone, which has hampered efforts there to accurately diagnose and adequately treat the disease. Many aid organizations are calling for global assistance from any provider with expertise in infectious disease processes and handling special virus samples, as fatigued crews and staff shortages not only underserve the afflicted but create room for error while working and may be partially a cause of the heightened rate of healthcare worker infections, despite careful protocols.
The shortages are not only affecting healthcare workers. Shortages of food and clean water are increasing dangerously due to a number of secondary economic effects: businesses closing due to the outbreak or the repatriation of expatriate workers, farmers being unable to tend to their crops, and cargo vessels refusing to dock at ports where the virus may be present. Disease control efforts at international borders further restrict the delivery of food and other products. Economic recovery in Guinea, Liberia, and Sierra Leone may be slow, even when EVD is finally controlled – which experts have projected to take at least six to nine months.
These infections have also prompted several foreign missions, including the US Peace Corps, to suspend operations in Guinea, Liberia, and Sierra Leone and to repatriate personnel operating in the region. Other organizations, such as mining, extraction, and financial organizations, have reduced staff to essential personnel or have vacated entirely. Nigeria may be able to cope better due to its more fully established infrastructure and more coordinated response efforts, but international authorities have expressed concern that the cluster of EVD cases in Port Harcourt could surge following that index patient’s many contacts with coworkers, friends, and family members. So far, few nations have recommended against travel to Nigeria. However, media have reported that some hospitals in Lagos are rejecting patients with non-EVD-related complaints due to fears that healthcare personnel may be unknowingly exposed to EVD.
Analysis
In both scope and scale, this outbreak has become the largest recorded EVD outbreak in history. Previous EVD outbreaks largely occurred in extremely remote areas that prevented the geographic spread of disease activity. However, this outbreak has affected nearly the entirety of three neighboring countries, including significant areas of urban and peri-urban transmission. Prior to this outbreak, the largest known Ebola epidemic occurred in Uganda in 2000, when officials reported 425 confirmed, probable, or suspected cases. In this epidemic, though, officials have identified nearly 4,000 suspected, probable, and confirmed EVD cases, and some experts anticipate up to 20,000 cases before the end of the outbreak.
One of the primary explanations for the severity of EVD activity in Guinea, Liberia, and Sierra Leone relates to widespread community resistance to disease control measures. This outbreak is the first known incidence of EVD activity in West Africa, and – unlike populations living in countries such as Uganda or the DRC – communities in Guinea, Sierra Leone, and Liberia were largely unfamiliar with the measures necessary to control this disease. Even after more than six months of disease activity and response efforts, local populations remain suspicious of authorities. In at least one instance, a community rioted when officials sprayed disinfectant, because local residents believed that they were being sprayed with the disease and intentionally infected. Although many teams are making headway with cultural relations and communications, it is generally accepted that more connection is needed for wider messaging. Recently, the government of Uganda and the African Union had both pledged assistance in durable goods, personnel, and financing to aid in control measures. As Uganda has vast experience in EVD outbreaks, this may assist quite a bit in cultural sensitivity and processing.
Many communities are also deeply distrusting of international medical teams. In some cases, local communities blame these teams for bringing the disease into their country; at other times, communities merely believe that infected individuals will receive better care at home. In either case, media have reported many instances in which community members have forcibly removed confirmed or probable EVD patients from isolation, or patients have eloped quarantine to return home. For example, the EVD cluster in Lagos, Nigeria was caused by an EVD-infected traveler, who may have been seeking more advanced medical care outside Liberia, according to his wife. Furthermore, the EVD cluster in Port Harcourt, Nigeria was caused by a companion of that traveler, who fled quarantine in Lagos to seek care elsewhere.
Unrelated to the cases in West Africa, the Democratic Republic of the Congo (DRC) notified the WHO of a confirmed case of EVD on Aug. 26. In the midst of a hemorrhagic gastroenteritis outbreak not caused by EVD in or near the Equateur Province, the Ministry of Health was able to delineate that a separate strain of EVD had, in fact, occurred in a woman from Ikanamongo Village near Boende and spread to family members and healthcare workers who were caring for her. In total, 58 suspected and confirmed cases and 31 deaths from EVD have been reported as of Sept. 4. Experts from the DRC and WHO have isolated the area, and other expert aid partners have been called to manage the outbreak, which so far appears confined to that specific area.
With disease projections continuing to increase in Guinea, Liberia, and Sierra Leone, the risk profile for most travelers and expatriates remains unchanged: individuals should strongly consider deferring nonessential travel to these areas. The risk of EVD is highest for healthcare workers, family members caring for ill patients, those attending traditional funerals or burials, and the consumption or proximity to processing primate or bat bushmeat, which has since been ruled illegal in the affected areas. However, even individuals not involved in such activities – for whom EVD risk is low – are at risk of increasingly severe healthcare shortages and increasing potential for civil unrest in disease-affected areas. Furthermore, individuals requiring medical evacuation, even for non-EVD-related issues, face extreme challenges when leaving outbreak zones.
Disease response efforts continue in Lagos and River State, Nigeria. Impacts to travelers or expatriates in these areas should be nominal, and the risk of spread outside of these areas is generally low to moderate given the current climate. The one case identified in Dakar, Senegal, with multiple contacts under surveillance, should not pose any significant risk to travelers or expatriates. However, the general reaction of other countries to nations having had EVD has so far been significant. The WHO has still not instituted any travel or trade restrictions on any of the affected countries, but many countries have implemented enhanced health screenings at borders or international airports and restricted flights or border crossings from affected countries. Individuals and organizations should review risk tolerance levels in anticipation of sudden changes in security and travel impact. Furthermore, individuals in or near EVD-affected areas should practice diligent personal health precautions, keeping in mind the following EVD-specific information:
| Although EVD is considered “highly contagious,” it is not highly transmissible. The risk of transmission among people not involved in healthcare or funeral settings is small.Local hospitals in the three most affected areas are at overcapacity, and personnel operating in the area and requiring nonemergency care may consider soliciting provider care at a hotel in lieu of a clinic. Many times, intravenous fluids, respiratory therapy, and other types of care can be administered by healthcare professionals in quality hotels. However, durable medical equipment, fluids, and medications are in short supply. Healthcare workers currently operating in the area are most at risk, since EVD is passed through blood, organs, tissues, bodily fluids, and close personal contact with infected individuals. Occupations with personnel at risk of trauma need to consider their proximity to appropriate care facilities and the possibility of exposure to EVD or other diseases while being treated. Managers charged with site safety and health should be able to recognize the signs of EVD and other hemorrhagic fevers: headache behind the eyes, flu-like symptoms, high fevers, diarrhea, and petechiae – a red or purple “rash” that may appear under areas with pressure. Bleeding, which may only be a late symptom in EVD and also appears in a number of other infections, cannot be relied upon for identification. Frequent and thorough hand-washing with soap and water may reduce the incidence of disease. If soap and water is unavailable, use of a hand sanitizer with at least 60-percent alcohol is an adequate substitution.Do not consume “bushmeat” or the meat from any primate, rodent, dog, or bat in the affected areas. Social distancing and avoidance of crowded venues may reduce risk of disease transmission, and in some areas, it is now mandated. Be aware of increasing travel disruptions related to this outbreak Plan ahead for increased processing times at borders and international airports as countries implement health screenings of travelers from affected areas. Consider deferring nonessential travel to Guinea, Liberia, and Sierra Leone due to infrastructure difficulties and significant travel and medical evacuation restrictions. Be very aware of recent updates in travel restrictions and take these into your risk threshold matrix. Consider the potential supply chain difficulty as borders become restricted, inspections become more thorough, and transit times become more cumbersome. Some goods and services may take longer than others to arrive. Check with your insurance provider and assistance/response company prior to your departure to understand your level(s) of service, their policies and protocols, and their threshold for rapid decision making. Maintain contact with these partners during your trip and keep abreast of the current information for your decision making. |
Bear in mind that some restrictions may not apply only to Guinea, Liberia, and Sierra Leone. Some West African nations may be seen as “at risk” and treated with similar precautions of screening by other nations upon arrival. Certain facilities and laboratories throughout the world have been designated by their respective countries to receive and isolate any “suspected” EVD cases upon screening at points of entry. Special guidance and precautions have been sent out through many health ministries regarding the signs and symptoms of the disease, as well as the potential areas of exposures. There are a various other diseases that may mimic the initial phases of EVD. Fever, headache, nausea, vomiting, aches, and fatigue are seen in a plethora of West African ailments, including malaria, dengue, influenza, and others. Taking appropriate precautions against these diseases will lessen your chance of being identified and potentially quarantined by health personnel when entering or exiting a country.
There currently remain no definitive preventive vaccines or treatment options for EVD. Although recent research and efforts into several unique pharmaceuticals have shown promise in nonhuman primates and have been used experimentally during this crisis, it remains to be seen whether or not these are effective or safe treatments or preventive measures. Data from the field during an epidemic – which lacks supporting data or controls – is extremely difficult to assess. Numerous variables may account for the apparent success or failure of such an agent in any given individual. For example, the administration and subsequent recovery of two American patients from EVD after receiving one such medication may be due to the effectiveness of the medicine, may be coincidental, or may also be dependent on other factors. Likewise, the death of a Spanish missionary after receiving the same experimental treatment may or may not be indicative of that drug’s efficacy. Conclusions as to the effectiveness of these drugs are extremely premature at this juncture.
Originally published on Wednesday, October 29, 2014
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And yet American employers have been battening down for the Ebola pandemic possibly to come. Industrial health and safety experts have been recommending Ebola protective measures. Conferences on Ebola have been scheduled. Law firms have issued bulletins explicating the theoretical legal issues that might emerge were Ebola to infect American workplaces. The US Occupational Safety and Health Administration has even drawn criticism for not giving employers enough detailed guidance on preventing Ebola.
Meanwhile, where an actual Ebola pandemic rages in real time and endangers countless workers is West Africa, particularly Liberia, Sierra Leone and parts of Mali and Guinea. The World Health Organisation had declared Africa’s Ebola pandemic a “Public Health Emergency of International Concern.” The pandemic has killed well over 5,000 Africans with “more than 150 Liberian medical workers [having] died from Ebola.” (S. Fink, “Treating Those Treating Ebola in Liberia,” The New York Times, Nov. 6, 2014)
As of 2014, the most urgent real-world Ebola risk threatening the American workforce is in Africa—that is, the danger US-based staff face when traveling for work to West Africa. Think of researchers, journalists, consultants, medical relief workers, infrastructure development teams, government staff, government contractors, and American expatriates who happen to live and work where Ebola strikes.
And so the most practical Ebola question that employers should be asking about their American staff is: What is our liability risk as to our US-based employees and expatriates who contract Ebola while working overseas?
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