Risk Insider: Joe Cellura

The Expanding Liability of Sports Concussions

By: | May 3, 2018 • 3 min read
Joe Cellura is President, North American Casualty, at Allied World, responsible for for the production and profitability of Primary Casualty, Excess Casualty, Environmental, Surety, Primary Construction and Programs. He can be reached at [email protected]

Since we examined the issue of head trauma two years ago, concussion awareness has gained tremendous traction.  Nowhere is this more apparent than on the angst-ridden faces of parents watching from the sidelines after their young player sustains a hit to the head.  Should the player be sidelined or continue to play?  The vast majority of sports organizations have protocols in place to address potential concussions.  Parents of youth and high school athletes also sign waivers acknowledging that brain damage is now a risk of the game.  Still, in a sports-loving culture, it’s a tough call.

Think about the star player with the big game days away or the high school athlete performing for college scouts.  Once diagnosed with multiple concussions, a young player may be forced to retire from the sport that has been central to their life.  No wonder some 50 percent of concussed athletes are not reporting injuries.

Immediate on-field diagnosis of concussions remains challenging.  Even the NFL is still learning.  This past season, Houston Texans quarterback Tom Savage was let back into a game after a major hit from the San Francisco 49ers defense, despite TV cameras recording his hands twitching alarmingly after he went down.  He was later further evaluated and removed from the game.  This delayed diagnosis was hardly an isolated incident and the NFL continues to refine its protocols.

Brain science, on the other hand, is increasingly black and white.  It clearly evidences the long-term damage of concussions, including Alzheimer’s, dementia and CTE.  If a concussed athlete is returned to play too soon, the ramifications of a second hit can be immediate: permanent brain damage and even death.

It’s not just lives at stake.  Sports organizations face potentially massive legacy exposures and ongoing concussion liability every day they continue to play.  Following the 2016 NFL settlement, organizations throughout the sports world have been bracing for impact.  Class action litigation against the NCAA continues and is expanding, with an estimated class of 4.4 million student-athletes amassed over decades. Litigation is trickling down to the local level, targeting schools and municipalities.  One school district was recently ordered to pay $7 million to the family of a former high school football player who suffered a debilitating head injury in a game.  The suit alleged that the football staff failed to recognize and respond to concussion symptoms.“We didn’t know the danger” will be increasingly difficult to support as a defense in failure to warn brain trauma-derived tort litigation.

As concussion awareness and litigation have expanded, the focus on safety has increased as well.  The risk management obligations of major sports organizations — including their trainers, doctors and coaches — continue to elevate and are trickling down to every level of sports, right down to primary school playgrounds.  It remains to be seen how litigation will ultimately reshape sports at every level, but we can anticipate that the ramifications will be significant.

It’s not just lives at stake.  Sports organizations face potentially massive legacy exposures and ongoing concussion liability every day they continue to play.

For those in the business of insuring liabilities, brain trauma is an emerging latent exposure the likes of which the insurance industry has not seen in decades. Comparisons to the asbestos crisis are unavoidable.  In the case of asbestos, years of exposure to the hazard manifested itself only decades later.  The medical and scientific community had to play catch-up to establish effective protective protocols and the insurance industry was slow to react in providing solutions for the exposures.

In the case of head trauma, industry response has thus far been varied.  Some carriers are deploying comprehensive CTE or concussion-related exclusions on a case-by-case basis, depending on class, sport and individual risk management protocols.  Some carriers are wholly excluding concussion-related risks or providing warranties and sub-limits of coverage, attempting to ‘wall off’ legacy exposure.  Still others are not unlike the parent on the sideline, wondering whether they should keep playing the game at all.  Moving forward, I anticipate more insurers will migrate from occurrence to claims made coverage to mitigate tail exposure.

As an industry, we need to continue to invest in understanding the exposure, innovating to manage it and collaborating with municipalities, universities and professional sports leagues to manage and mitigate the risk.  As medical and technological advances enhance the ability to detect and prevent concussions, our ability to prudently underwrite it will be enhanced.  Data and science will fuel a much faster insurance industry response than we saw with asbestos liability, though these same advances will likely sharpen the ability to understand timing, origin and extent of injuries for litigation purposes as well.

One thing is certain: tackling this risk requires a major league commitment from our industry.  As we saw in the NFL this season, managing concussion risk is a work in progress.

More from Risk & Insurance

More from Risk & Insurance

Risk Report: Manufacturing

More Robots Enter Into Manufacturing Industry

With more jobs utilizing technology advancements, manufacturing turns to cobots to help ease talent gaps.
By: | May 1, 2018 • 6 min read

The U.S. manufacturing industry is at a crossroads.

Faced with a shortfall of as many as two million workers between now and 2025, the sector needs to either reinvent itself by making it a more attractive career choice for college and high school graduates or face extinction. It also needs to shed its image as a dull, unfashionable place to work, where employees are stuck in dead-end repetitive jobs.


Added to that are the multiple risks caused by the increasing use of automation, sensors and collaborative robots (cobots) in the manufacturing process, including product defects and worker injuries. That’s not to mention the increased exposure to cyber attacks as manufacturers and their facilities become more globally interconnected through the use of smart technology.

If the industry wishes to continue to move forward at its current rapid pace, then manufacturers need to work with schools, governments and the community to provide educational outreach and apprenticeship programs. They must change the perception of the industry and attract new talent. They also need to understand and to mitigate the risks presented by the increased use of technology in the manufacturing process.

“Loss of knowledge due to movement of experienced workers, negative perception of the manufacturing industry and shortages of STEM (science, technology, engineering and math) and skilled production workers are driving the talent gap,” said Ben Dollar, principal, Deloitte Consulting.

“The risks associated with this are broad and span the entire value chain — [including]  limitations to innovation, product development, meeting production goals, developing suppliers, meeting customer demand and quality.”

The Talent Gap

Manufacturing companies are rapidly expanding. With too few skilled workers coming in to fill newly created positions, the talent gap is widening. That has been exacerbated by the gradual drain of knowledge and expertise as baby boomers retire and a decline in technical education programs in public high schools.

Ben Dollar, principal, Deloitte Consulting

“Most of the millennials want to work for an Amazon, Google or Yahoo, because they seem like fun places to work and there’s a real sense of community involvement,” said Dan Holden, manager of corporate risk and insurance, Daimler Trucks North America. “In contrast, the manufacturing industry represents the ‘old school’ where your father and grandfather used to work.

“But nothing could be further from the truth: We offer almost limitless opportunities in engineering and IT, working in fields such as electric cars and autonomous driving.”

To dispel this myth, Holden said Daimler’s Educational Outreach Program assists qualified organizations that support public high school educational programs in STEM, CTE (career technical education) and skilled trades’ career development.

It also runs weeklong technology schools in its manufacturing facilities to encourage students to consider manufacturing as a vocation, he said.

“It’s all essentially a way of introducing ourselves to the younger generation and to present them with an alternative and rewarding career choice,” he said. “It also gives us the opportunity to get across the message that just because we make heavy duty equipment doesn’t mean we can’t be a fun and educational place to work.”

Rise of the Cobot

Automation undoubtedly helps manufacturers increase output and improve efficiency by streamlining production lines. But it’s fraught with its own set of risks, including technical failure, a compromised manufacturing process or worse — shutting down entire assembly lines.


More technologically advanced machines also require more skilled workers to operate and maintain them. Their absence can in turn hinder the development of new manufacturing products and processes.

Christina Villena, vice president of risk solutions, The Hanover Insurance Group, said the main risk of using cobots is bodily injury to their human coworkers. These cobots are robots that share a physical workspace and interact with humans. To overcome the problem of potential injury, Villena said, cobots are placed in safety cages or use force-limited technology to prevent hazardous contact.

“With advancements in technology, such as the Cloud, there are going to be a host of cyber and other risks associated with them.” — David Carlson, U.S. manufacturing and automobile practice leader, Marsh

“Technology must be in place to prevent cobots from exerting excessive force against a human or exposing them to hazardous tools or chemicals,” she said. “Traditional robots operate within a safety cage to prevent dangerous contact. Failure or absence of these guards has led to injuries and even fatalities.”

The increasing use of interconnected devices and the Cloud to control and collect data from industrial control systems can also leave manufacturers exposed to hacking, said David Carlson, Marsh’s U.S. manufacturing and automobile practice leader. Given the relatively new nature of cyber as a risk, however, he said coverage is still a gray area that must be assessed further.

“With advancements in technology, such as the Cloud, there are going to be a host of cyber and other risks associated with them,” he said. “Therefore, companies need to think beyond the traditional risks, such as workers’ compensation and product liability.”

Another threat, said Bill Spiers, vice president, risk control consulting practice leader, Lockton Companies, is any malfunction of the software used to operate cobots. Then there is the machine not being able to cope with the increased workload when production is ramped up, he said.

“If your software goes wrong, it can stop the machine working or indeed the whole manufacturing process,” he said. “[Or] you might have a worker who is paid by how much they can produce in an hour who decides to turn up the dial, causing the machine to go into overdrive and malfunction.”

Potential Solutions

Spiers said risk managers need to produce a heatmap of their potential exposures in the workplace attached to the use of cobots in the manufacturing process, including safety and business interruption. This can also extend to cyber liability, he said.

“You need to understand the risk, if it’s controllable and, indeed, if it’s insurable,” he said. “By carrying out a full risk assessment, you can determine all of the relevant issues and prioritize them accordingly.”

By using collective learning to understand these issues, Joseph Mayo, president, JW Mayo Consulting, said companies can improve their safety and manufacturing processes.

“Companies need to work collaboratively as an industry to understand this new technology and the problems associated with it.” — Joseph Mayo, president, JW Mayo Consulting

“Companies need to work collaboratively as an industry to understand this new technology and the problems associated with it,” Mayo said. “They can also use detective controls to anticipate these issues and react accordingly by ensuring they have the appropriate controls and coverage in place to deal with them.”


Manufacturing risks today extend beyond traditional coverage, like workers’ compensation, property, equipment breakdown, automobile, general liability and business interruption, to new risks, such as cyber liability.

It’s key to use a specialized broker and carrier with extensive knowledge and experience of the industry’s unique risks.

Stacie Graham, senior vice president and general manager, Liberty Mutual’s national insurance central division, said there are five key steps companies need to take to protect themselves and their employees against these risks. They include teaching them how to use the equipment properly, maintaining the same high quality of product and having a back-up location, as well as having the right contractual insurance policy language in place and plugging any potential coverage gaps.

“Risk managers need to work closely with their broker and carrier to make sure that they have the right contractual controls in place,” she said. “Secondly, they need to carry out on-site visits to make sure that they have the right safety practices and to identify the potential claims that they need to mitigate against.” &

Alex Wright is a U.K.-based business journalist, who previously was deputy business editor at The Royal Gazette in Bermuda. You can reach him at [email protected]