FEMA's Waffle House Index

Working Like Waffle House

FEMA gauges disaster severity by how many Waffle House restaurants are open.
By: | November 1, 2013 • 9 min read

The category EF5 tornado that tore through Moore, Okla., on May 20 etched a 17-mile path of destruction through thousands of homes and businesses, three schools and one hospital.

Estimates of insured losses reached $2 billion in the first 24 hours after the disaster, topping the cost of the twister that ravaged Joplin, Mo., in 2011. Sitting about three-quarters of a mile south of the tornado’s path, near 19th Street and Tower Drive, sat the local Waffle House.

“It was down without power, and the town was just devastated,” said Waffle House Vice President of Culture Pat Warner. “A normal 20-minute drive to work took about three hours to get around all the debris and roadblocks.”

Employees of the restaurant, however, were undeterred. Warner said the workers convinced a sheriff’s deputy to let them into the limited-access area in order to “get the restaurant open for our customers.”


“If you have a storm and you can get a restaurant operational quickly that can provide water and food, that’s a really good thing because otherwise people go hungry,” said Ted Devine, CEO of insureon, a small business insurance provider.

Though its power was knocked out, Moore’s Waffle House sustained no physical damage. It procured a backup generator and was serving up hot meals to neighbors and relief workers within two days after the tornado hit.

But quick recovery is nothing new for the popular breakfast destination.

Waffle House spokeswoman Kelly Thrasher said that Hurricane Katrina in 2005 forced 100 restaurants to close, and 60 were able to reopen within one day.

R11-13p72-74_11Waffle.indd” … If you don’t have a plan and know exactly what you’re going to do when the event happens, you’re [in trouble].”
— Ted Devine, CEO, insureon


In 2011, restaurants affected by deadly tornadoes in Alabama and Missouri and by Hurricane Irene along the Southeast coastal region saw similarly speedy recoveries, she said. Waffle House’s ability to get up and running so quickly in the wake of disaster has earned it a stellar crisis management reputation.

So much so that the “Waffle House Index” has become a mainstay in the damage analysis toolbox of FEMA Administrator Craig Fugate.

The Waffle House Index — seeing if the local Waffle House is open and fully operational — is the informal way Fugate measures a community’s post-disaster damage and potential speed of recovery. A closed restaurant is coded red; an open restaurant serving a limited menu is yellow, and an open establishment with a full menu is green.

Fugate hatched the idea of the Index while surveying tornado damage in 2011: “If you get there and the Waffle House is closed? That’s really bad. That’s where you go to work,” he said.

Panos Kouvelis, an Olin Business School professor at Washington University in St. Louis and an expert in supply chain management, said Waffle House is one of several “world-class examples in their disaster management and humanitarian response planning approaches.”

His academic paper, “The ‘Waffle House’ Emergency Level Index,” detailed the challenges faced by businesses, including Wal-Mart, Lowe’s and Home Depot, that provide key services to a recovering community.

“Predicting customer demand after a disaster event, providing product required to the affected stores in an accurate and timely manner, establishing appropriate and ethical prices for their products, and maintaining adequate work-force levels after the event” are all part of an ironclad recovery plan.

Waffle House knows its customer demand will be high when scores of homes lose power to keep and cook food. Their employees’ commitment to serve those customers helps take care of the rest.

“We’ve been a 24-hour restaurant since 1955. We’re open on the holidays, on weekends and nights. So for us to close down is kind of against what we do.”
— Pat Warner, vice president of culture, Waffle House

The Waffle House Way

“[Our associates] know that their neighbors are going to be hungry, and opening the restaurant is their way to pitch in and get the community back on its feet,” Warner said. In addition to employee altruism, he credited the company’s dedication to quick recovery to its history as an around-the-clock restaurant.

“We’ve been a 24-hour restaurant since 1955. We’re open on the holidays, on weekends and nights,” he said. “So for us to close down is kind of against what we do. And our folks who run the restaurants really know that because they see their customers every day, and we’re fortunate enough to have regulars who come in sometimes more than once a day.”


Even associates from restaurants hundreds of miles outside of affected areas have been known call the corporate office offering to send relief workers. Warner said the company takes on crisis recovery with a “family approach.”

But if employees’ desire to pitch in and restore their community is like the gas that fuels a car, executive leadership and proactive planning are the steering wheel and tires.

Waffle House has no dedicated response team; the executive vice president of a region where a store has been hit heads up recovery, according to Warner, by overseeing delivery of emergency supplies and determining the availability of workers in the area.

Dedicated teams lend support from corporate headquarters in Norcross, Ga., sending in construction teams and a mobile communications RV, which keeps workers in the field connected to a “situation room” back at the office. At the end of the day, though, “the folks in the field are the ones calling the shots,” Warner said.

Though they reach as far west as Phoenix and as far north as towns in Ohio and Pennsylvania, Waffle House’s nearly 1,700 restaurants are clustered heavily in the Southeast. They are, therefore, particularly susceptible to hurricane damage.

“We spend a lot of time with our suppliers in the off-season to ensure that they are ready when a hurricane hits,” Warner said. “Typically, they’ll have trucks loaded and ready to roll in right after the storm. That’s a key part of it, getting that safe food supply in because you really don’t know what you’ll have after the storm that’s local, and we wind up having to purge a lot of food.”

What Kouvelis dubbed as the gold standard of disaster response, then, seems to have no secret weapon. There is no superstar risk manager at the helm, no hidden stashes of backup generators or fresh water and supplies, nothing to incentivize employees’ swift actions other than the satisfaction of helping their hometown. The key to excellent crisis management is nothing more than swift execution of a simple but well-laid plan.

Planning Ahead

Devine of insureon compares this to athletes knowing how to react in different game situations.

“I coach hockey,” he said. “When the puck’s going 90 miles per hour and a 200-pound human being is skating at you at 20 miles per hour hitting you into the boards, if you don’t have a plan and know exactly what you’re going to do when the event happens, you’re [in trouble].”

Getting operational quickly happens when plans are executed immediately, not when plans are just  made when an event demands it.

Documenting and outlining all possible risks and exposures should be top priority for risk managers, Devine said. That lays the groundwork for developing a plan of action.

“That means thinking through your insurance covers and making sure you have all the business interruption and contingent business interruption policies in place, both for yourself and your supply chain,” he said.

Then come the non-insurance-related courses of action. How will employees be contacted? How will customers be notified of the business’s status? Where will backup supplies like a generator come from? Has the facility been weather-proofed? How will the IT platform be managed? Having the pieces aligned brings the puzzle together much more quickly when the worst happens, he said.

David Cox, president of Arby’s supply chain co-op ARCOP, said risk can be mitigated by considering the proximity of suppliers and distributors. When an event knocks out a link in the chain, a backup plan should be quick and easy to set in motion.

“Some of our distributors have three or four distribution centers, so it would be easy for them to figure out a plan to get product to those stores that are serviced out of a damaged center,” Cox said. “Where we have single distribution centers, there are competing centers close enough that would pick up the slack.”

Restaurant owners and risk managers should also list key items that make up a good chunk of their menu and have two suppliers for each of those ingredients or products. Especially in a disaster, knowing where to get water and ice is crucial.

According to Cox, Arby’s will have refrigerated trucks packed with product situated just outside of forecasted storm areas, waiting to move in when the hurricane passes. If electricity is down, they will station those trucks in the restaurant parking lot so workers can continually withdraw fresh food until their own freezers get power again.

Some of these preparatory steps only apply, though, in the case of hurricanes.


Weather forecasters can predict with a high degree of accuracy when and where a hurricane will make landfall, what path it will take and how intense the winds and rain will be. That gives businesses time to prepare their facilities and contact their suppliers.

Tornadoes are a different story. The current average lead-time for tornado warnings is 13 minutes, according to the National Oceanic and Atmospheric Administration. Barely enough time to take cover, let alone call for backup.

Tornado recovery is inherently reactionary, but the upside is that twisters cause damage on a much smaller scale than hurricanes, allowing for greater focus of resources. It also means more people are available to help, without their own devastation to deal with.

Some companies rely on simple, good-willed help more than others.

Devine’s clients, for example, are small businesses with tighter budgets and limited resources. They depend entirely on local support and loyalty to thrive.

“If the small businesses can get operational quickly, they can actually make the community a better place more quickly,” he said. When nearly 40 percent of small businesses fail to reopen after a disaster, however, that’s a formidable challenge.

With more than 1,000 locations, Waffle House is hardly small. But the warm atmosphere of Southern hospitality each outpost strives to create may make it feel like it is.

As the Waffle House Index evinces, the restaurant chain has certainly carved itself a niche as a community mainstay, fitting into the unique fabric of each town it serves. Perhaps it’s that combination of big business leadership and resources, and small business customer and employee loyalty that makes its recovery efforts so effective.

“As a company we’re very flattered by the Waffle House Index,” Warner said. “It shows that our hard work is being noticed. When the emergency response people are looking to you, you know you’re doing something right.”

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance


Kiss Your Annual Renewal Goodbye; On-Demand Insurance Challenges the Traditional Policy

Gig workers' unique insurance needs drive delivery of on-demand coverage.
By: | September 14, 2018 • 6 min read

The gig economy is growing. Nearly six million Americans, or 3.8 percent of the U.S. workforce, now have “contingent” work arrangements, with a further 10.6 million in categories such as independent contractors, on-call workers or temporary help agency staff and for-contract firms, often with well-known names such as Uber, Lyft and Airbnb.

Scott Walchek, founding chairman and CEO, Trōv

The number of Americans owning a drone is also increasing — one recent survey suggested as much as one in 12 of the population — sparking vigorous debate on how regulation should apply to where and when the devices operate.

Add to this other 21st century societal changes, such as consumers’ appetite for other electronic gadgets and the advent of autonomous vehicles. It’s clear that the cover offered by the annually renewable traditional insurance policy is often not fit for purpose. Helped by the sophistication of insurance technology, the response has been an expanding range of ‘on-demand’ covers.

The term ‘on-demand’ is open to various interpretations. For Scott Walchek, founding chairman and CEO of pioneering on-demand insurance platform Trōv, it’s about “giving people agency over the items they own and enabling them to turn on insurance cover whenever they want for whatever they want — often for just a single item.”


“On-demand represents a whole new behavior and attitude towards insurance, which for years has very much been a case of ‘get it and forget it,’ ” said Walchek.

Trōv’s mobile app enables users to insure just a single item, such as a laptop, whenever they wish and to also select the period of cover required. When ready to buy insurance, they then snap a picture of the sales receipt or product code of the item they want covered.

Welcoming Trōv: A New On-Demand Arrival

While Walchek, who set up Trōv in 2012, stressed it’s a technology company and not an insurance company, it has attracted industry giants such as AXA and Munich Re as partners. Trōv began the U.S. roll-out of its on-demand personal property products this summer by launching in Arizona, having already established itself in Australia and the United Kingdom.

“Australia and the UK were great testing grounds, thanks to their single regulatory authorities,” said Walchek. “Trōv is already approved in 45 states, and we expect to complete the process in all by November.

“On-demand products have a particular appeal to millennials who love the idea of having control via their smart devices and have embraced the concept of an unbundling of experiences: 75 percent of our users are in the 18 to 35 age group.” – Scott Walchek, founding chairman and CEO, Trōv

“On-demand products have a particular appeal to millennials who love the idea of having control via their smart devices and have embraced the concept of an unbundling of experiences: 75 percent of our users are in the 18 to 35 age group,” he added.

“But a mass of tectonic societal shifts is also impacting older generations — on-demand cover fits the new ways in which they work, particularly the ‘untethered’ who aren’t always in the same workplace or using the same device. So we see on-demand going into societal lifestyle changes.”

Wooing Baby Boomers

In addition to its backing for Trōv, across the Atlantic, AXA has partnered with Insurtech start-up By Miles, launching a pay-as-you-go car insurance policy in the UK. The product is promoted as low-cost car insurance for drivers who travel no more than 140 miles per week, or 7,000 miles annually.

“Due to the growing need for these products, companies such as Marmalade — cover for learner drivers — and Cuvva — cover for part-time drivers — have also increased in popularity, and we expect to see more enter the market in the near future,” said AXA UK’s head of telematics, Katy Simpson.

Simpson confirmed that the new products’ initial appeal is to younger motorists, who are more regular users of new technology, while older drivers are warier about sharing too much personal information. However, she expects this to change as on-demand products become more prevalent.

“Looking at mileage-based insurance, such as By Miles specifically, it’s actually older generations who are most likely to save money, as the use of their vehicles tends to decline. Our job is therefore to not only create more customer-centric products but also highlight their benefits to everyone.”

Another Insurtech ready to partner with long-established names is New York-based Slice Labs, which in the UK is working with Legal & General to enter the homeshare insurance market, recently announcing that XL Catlin will use its insurance cloud services platform to create the world’s first on-demand cyber insurance solution.

“For our cyber product, we were looking for a partner on the fintech side, which dovetailed perfectly with what Slice was trying to do,” said John Coletti, head of XL Catlin’s cyber insurance team.

“The premise of selling cyber insurance to small businesses needs a platform such as that provided by Slice — we can get to customers in a discrete, seamless manner, and the partnership offers potential to open up other products.”

Slice Labs’ CEO Tim Attia added: “You can roll up on-demand cover in many different areas, ranging from contract workers to vacation rentals.

“The next leap forward will be provided by the new economy, which will create a range of new risks for on-demand insurance to respond to. McKinsey forecasts that by 2025, ecosystems will account for 30 percent of global premium revenue.


“When you’re a start-up, you can innovate and question long-held assumptions, but you don’t have the scale that an insurer can provide,” said Attia. “Our platform works well in getting new products out to the market and is scalable.”

Slice Labs is now reviewing the emerging markets, which aren’t hampered by “old, outdated infrastructures,” and plans to test the water via a hackathon in southeast Asia.

Collaboration Vs Competition

Insurtech-insurer collaborations suggest that the industry noted the banking sector’s experience, which names the tech disruptors before deciding partnerships, made greater sense commercially.

“It’s an interesting correlation,” said Slice’s managing director for marketing, Emily Kosick.

“I believe the trend worth calling out is that the window for insurers to innovate is much shorter, thanks to the banking sector’s efforts to offer omni-channel banking, incorporating mobile devices and, more recently, intelligent assistants like Alexa for personal banking.

“Banks have bought into the value of these technology partnerships but had the benefit of consumer expectations changing slowly with them. This compares to insurers who are in an ever-increasing on-demand world where the risk is high for laggards to be left behind.”

As with fintechs in banking, Insurtechs initially focused on the retail segment, with 75 percent of business in personal lines and the remainder in the commercial segment.

“Banks have bought into the value of these technology partnerships but had the benefit of consumer expectations changing slowly with them. This compares to insurers who are in an ever-increasing on-demand world where the risk is high for laggards to be left behind.” — Emily Kosick, managing director, marketing, Slice

Those proportions may be set to change, with innovations such as digital commercial insurance brokerage Embroker’s recent launch of the first digital D&O liability insurance policy, designed for venture capital-backed tech start-ups and reinsured by Munich Re.

Embroker said coverage that formerly took weeks to obtain is now available instantly.

“We focus on three main issues in developing new digital business — what is the customer’s pain point, what is the expense ratio and does it lend itself to algorithmic underwriting?” said CEO Matt Miller. “Workers’ compensation is another obvious class of insurance that can benefit from this approach.”

Jason Griswold, co-founder and chief operating officer of Insurtech REIN, highlighted further opportunities: “I’d add a third category to personal and business lines and that’s business-to-business-to-consumer. It’s there we see the biggest opportunities for partnering with major ecosystems generating large numbers of insureds and also big volumes of data.”

For now, insurers are accommodating Insurtech disruption. Will that change?


“Insurtechs have focused on products that regulators can understand easily and for which there is clear existing legislation, with consumer protection and insurer solvency the two issues of paramount importance,” noted Shawn Hanson, litigation partner at law firm Akin Gump.

“In time, we could see the disruptors partner with reinsurers rather than primary carriers. Another possibility is the likes of Amazon, Alphabet, Facebook and Apple, with their massive balance sheets, deciding to link up with a reinsurer,” he said.

“You can imagine one of them finding a good Insurtech and buying it, much as Amazon’s purchase of Whole Foods gave it entry into the retail sector.” &

Graham Buck is a UK-based writer and has contributed to Risk & Insurance® since 1998. He can be reached at riskletters.com.