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Loss Prevention

How To Manage Losses Due To Slips and Falls in High-End Retail

New advancements in tribometry are advancing the art and science of slips and falls prevention.
By: | May 1, 2018 • 5 min read

Picture this: It’s the busy holiday shopping season. A mid-December snow, while charming and evocative of Christmas carols, brings moisture to the streets of New York, some of which is tracked into the foyer and shopping aisles of one of that city’s high-end retailers.

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A shopper in her early seventies, well off but not as nimble as she once was, rounds the corner of one of the store’s aisles, which is more choked than usual with holiday sale displays and eye-catching impulse items.

She’s not in dressy high heels, but is wearing stylish leather boots with three-inch heels.  Momentarily distracted, perhaps by the beauty of a glittering bulb on a real-life Christmas tree, or a nudge from a passing shopper, she steps on a slick point of the polished floor, made more slippery by those melted snowflakes. She slips, throws out her arm to catch something and catches nothing, striking the floor head first and suffering a traumatic brain injury.

This horrendous scenario, though not a frequent occurrence in high-end retail, does occur. And when it happens, it results not only in life-altering injuries but also settlements in the six figures. Employees are at risk as well. More than 17 percent of all disabling workplace injuries are caused by slips and falls.

Mitigating slips and falls in retail, in general, is complicated. But high-end retail, with its focus on heritage properties, original design materials and glossy finishes, carries its own set of risk management complications.

According to Walter Palmer, loss control expert and practice leader, EPIC Insurance Brokers & Consultants, high-end retail and its focus on design does present its own challenges; things such as marble staircases and vintage throw rugs aren’t a risk manager’s preferred materials.

“One of the challenges for risk managers is to have to work around those parameters the best they can so that they can support the artistic vision that the company has and at the same time be able to mitigate the risk. At high-end retail, they need to be able to tell that story to their broker,” he said.

I always tell my retail clients to take pictures right off the bat because you have one shot at that when a fall happens.  Richard Gelok, Florida-based casualty general adjuster, Engle Martin

And although some high-end retailers shoot for a consistent look in their stores across the country, others may go for different styles, varying the layout from store to store, making the risk manager’s job that much harder.

High-end retailers also need to be very “buttoned down” about the way they report accidents. In the area of what claims adjusters call “frequent fliers,” or slip and fall fraudsters, Palmer’s high-end retail clients say they feel they are targeted by fraud perpetrators more often because of the perception they have deeper pockets and may also be more sensitive to the reputational hit of a casualty lawsuit.

Train and Document

Generally speaking, when it comes to the size of a claim, it matters more how severely injured a claimant is and how negligent the store owner was than the brand of the store. According to a veteran casualty claims adjuster, when an accident happens, documenting it well and handing the case off to the adjuster in good order is paramount.

“I always tell my retail clients to take pictures right off the bat because you have one shot at that when a fall happens,” said Richard Gelok, Florida-based casualty general adjuster, Engle Martin.

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“I can come back 24 hours later after I get assigned the file and the scene is not going to be the same at all,” Gelok said. “It’s important to make an assessment of the claimant, if they’re smelling of alcohol, if they’re slurring their words, or if they were on their phone. There is comparative negligence with every slip and fall, in my opinion.”

“You’re going to have different defenses with respect to the defect that is being claimed,” said Kari Melkonian, a Michigan-based attorney of Collins, Einhorn, Farrell PC, who defends insureds and their insurance companies in slip-and-fall cases.

“Premises owners, in general, have a duty to protect invitees against known dangerous conditions on the property. Landlords owe additional statuatory duties to their tenants,” Melkonian said.

Videotaping store aisles can help a defendant if it can be shown that 90 people walked down a given aisle in one afternoon and only one of them fell and there was no evidence of water or any other hazard, she said.

Like Engle Martin’s Gelok, Melkonian said training employees to document the circumstances of the incident well, including taking photographs and interviewing the person that fell, are best practices.

Simple Chemistry

In 2010, commercial insurer CNA noticed an uptick in general liability claims involving slips and falls. The company set out to learn more about the topic and came up with some noteworthy conclusions.

In a two-year study of hard surface floors in commercial workplaces, CNA found that 50 percent of the surfaces studied did not meet the minimum traction standards set by the American National Standards Institute.

Walter Palmer
Practice leader with EPIC Insurance Brokers & Consultants

“From both the frequency and the severity standpoint, safety managers for these types of facilities aren’t always aware of the extent of their slip-and-fall exposure,” said Steve Hernandez,  senior vice president of risk control, CNA.

CNA’s study authors came up with four key strategies to implement:

Select the right flooring. This includes not only the properties of the flooring itself, but also the space and the environment;

Test your floors for slip resistance. The science of tribometry measures slip resistance. This allows premises owners to better comply with flooring manufacturers’ specifications;

Choose the right cleaning agents: This one gets complicated. It involves insuring that cleaning vendors are not only using the right cleaning agents for the type of flooring they are cleaning, but that they are financially stable, ethically sound and operate under a strong risk management structure.

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Even the way you store a mop matters, said CNA’s Hernandez. “The handle end should point down. Keeping the mop end on the floor means it’s always in contact with debris and won’t clear away contaminants as effectively;” and

Promote awareness of slip-and-fall hazards. This involves removing walkway obstacles, displaying signage in areas with floor elevation changes, placing mats near doorway entrances and using design that reduces reflective glare.

Falls among adults are the most common cause of traumatic brain injury. The CNA study reports that among its closed claims between 2007 and 2012, the average cost of a traumatic brain injury in a general liability claim was $269,643. The average cost of a traumatic brain injury in workers’ comp claims was $259,153.

EPIC’s Palmer said “underwriters are looking for good visibility and good reporting not just on the metrics as far as the final results, but also causality. They’re looking toward a comprehensive approach in terms of how you address it from a training perspective and the scientific aspect, making sure that you have corporately approved cleaning agents that work well in your environment.” &

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Cyber Resilience

No, Seriously. You Need a Comprehensive Cyber Incident Response Plan Before It’s Too Late.

Awareness of cyber risk is increasing, but some companies may be neglecting to prepare adequate response plans that could save them millions. 
By: | June 1, 2018 • 7 min read

To minimize the financial and reputational damage from a cyber attack, it is absolutely critical that businesses have a cyber incident response plan.

“Sadly, not all yet do,” said David Legassick, head of life sciences, tech and cyber, CNA Hardy.

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In the event of a breach, a company must be able to quickly identify and contain the problem, assess the level of impact, communicate internally and externally, recover where possible any lost data or functionality needed to resume business operations and act quickly to manage potential reputational risk.

This can only be achieved with help from the right external experts and the design and practice of a well-honed internal response.

The first step a company must take, said Legassick, is to understand its cyber exposures through asset identification, classification, risk assessment and protection measures, both technological and human.

According to Raf Sanchez, international breach response manager, Beazley, cyber-response plans should be flexible and applicable to a wide range of incidents, “not just a list of consecutive steps.”

They also should bring together key stakeholders and specify end goals.

Jason J. Hogg, CEO, Aon Cyber Solutions

With bad actors becoming increasingly sophisticated and often acting in groups, attack vectors can hit companies from multiple angles simultaneously, meaning a holistic approach is essential, agreed Jason J. Hogg, CEO, Aon Cyber Solutions.

“Collaboration is key — you have to take silos down and work in a cross-functional manner.”

This means assembling a response team including individuals from IT, legal, operations, risk management, HR, finance and the board — each of whom must be well drilled in their responsibilities in the event of a breach.

“You can’t pick your players on the day of the game,” said Hogg. “Response times are critical, so speed and timing are of the essence. You should also have a very clear communication plan to keep the CEO and board of directors informed of recommended courses of action and timing expectations.”

People on the incident response team must have sufficient technical skills and access to critical third parties to be able to make decisions and move to contain incidents fast. Knowledge of the company’s data and network topology is also key, said Legassick.

“Perhaps most important of all,” he added, “is to capture in detail how, when, where and why an incident occurred so there is a feedback loop that ensures each threat makes the cyber defense stronger.”

Cyber insurance can play a key role by providing a range of experts such as forensic analysts to help manage a cyber breach quickly and effectively (as well as PR and legal help). However, the learning process should begin before a breach occurs.

Practice Makes Perfect

“Any incident response plan is only as strong as the practice that goes into it,” explained Mike Peters, vice president, IT, RIMS — who also conducts stress testing through his firm Sentinel Cyber Defense Advisors.

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Unless companies have an ethical hacker or certified information security officer on board who can conduct sophisticated simulated attacks, Peters recommended they hire third-party experts to test their networks for weaknesses, remediate these issues and retest again for vulnerabilities that haven’t been patched or have newly appeared.

“You need to plan for every type of threat that’s out there,” he added.

Hogg agreed that bringing third parties in to conduct tests brings “fresh thinking, best practice and cross-pollination of learnings from testing plans across a multitude of industries and enterprises.”

“Collaboration is key — you have to take silos down and work in a cross-functional manner.” — Jason J. Hogg, CEO, Aon Cyber Solutions

Legassick added that companies should test their plans at least annually, updating procedures whenever there is a significant change in business activity, technology or location.

“As companies expand, cyber security is not always front of mind, but new operations and territories all expose a company to new risks.”

For smaller companies that might not have the resources or the expertise to develop an internal cyber response plan from whole cloth, some carriers offer their own cyber risk resources online.

Evan Fenaroli, an underwriting product manager with the Philadelphia Insurance Companies (PHLY), said his company hosts an eRiskHub, which gives PHLY clients a place to start looking for cyber event response answers.

That includes access to a pool of attorneys who can guide company executives in creating a plan.

“It’s something at the highest level that needs to be a priority,” Fenaroli said. For those just getting started, Fenaroli provided a checklist for consideration:

  • Purchase cyber insurance, read the policy and understand its notice requirements.
  • Work with an attorney to develop a cyber event response plan that you can customize to your business.
  • Identify stakeholders within the company who will own the plan and its execution.
  • Find outside forensics experts that the company can call in an emergency.
  • Identify a public relations expert who can be called in the case of an event that could be leaked to the press or otherwise become newsworthy.

“When all of these things fall into place, the outcome is far better in that there isn’t a panic,” said Fenaroli, who, like others, recommends the plan be tested at least annually.

Cyber’s Physical Threat

With the digital and physical worlds converging due to the rise of the Internet of Things, Hogg reminded companies: “You can’t just test in the virtual world — testing physical end-point security is critical too.”

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How that testing is communicated to underwriters should also be a key focus, said Rich DePiero, head of cyber, North America, Swiss Re Corporate Solutions.

Don’t just report on what went well; it’s far more believable for an underwriter to hear what didn’t go well, he said.

“If I hear a client say it is perfect and then I look at some of the results of the responses to breaches last year, there is a disconnect. Help us understand what you learned and what you worked out. You want things to fail during these incident response tests, because that is how we learn,” he explained.

“Bringing in these outside firms, detailing what they learned and defining roles and responsibilities in the event of an incident is really the best practice, and we are seeing more and more companies do that.”

Support from the Board

Good cyber protection is built around a combination of process, technology, learning and people. While not every cyber incident needs to be reported to the boardroom, senior management has a key role in creating a culture of planning and risk awareness.

David Legassick, head of life sciences, tech and cyber, CNA Hardy

“Cyber is a boardroom risk. If it is not taken seriously at boardroom level, you are more than likely to suffer a network breach,” Legassick said.

However, getting board buy-in or buy-in from the C-suite is not always easy.

“C-suite executives often put off testing crisis plans as they get in the way of the day job. The irony here is obvious given how disruptive an incident can be,” said Sanchez.

“The C-suite must demonstrate its support for incident response planning and that it expects staff at all levels of the organization to play their part in recovering from serious incidents.”

“What these people need from the board is support,” said Jill Salmon, New York-based vice president, head of cyber/tech/MPL, Berkshire Hathaway Specialty Insurance.

“I don’t know that the information security folks are looking for direction from the board as much as they are looking for support from a resources standpoint and a visibility standpoint.

“They’ve got to be aware of what they need and they need to have the money to be able to build it up to that level,” she said.

Without that support, according to Legassick, failure to empower and encourage the IT team to manage cyber threats holistically through integration with the rest of the organization, particularly risk managers, becomes a common mistake.

He also warned that “blame culture” can prevent staff from escalating problems to management in a timely manner.

Collaboration and Communication

Given that cyber incident response truly is a team effort, it is therefore essential that a culture of collaboration, preparation and practice is embedded from the top down.

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One of the biggest tripping points for companies — and an area that has done the most damage from a reputational perspective — is in how quickly and effectively the company communicates to the public in the aftermath of a cyber event.

Salmon said of all the cyber incident response plans she has seen, the companies that have impressed her most are those that have written mock press releases and rehearsed how they are going to respond to the media in the aftermath of an event.

“We have seen so many companies trip up in that regard,” she said. “There have been examples of companies taking too long and then not explaining why it took them so long. It’s like any other crisis — the way that you are communicating it to the public is really important.” &

Antony Ireland is a London-based financial journalist. He can be reached at [email protected] Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]