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Denver RIMS 2014 Educational Session
Travel Risk Solutions for
a Dangerous World
Joe Puzzo, SVP AIG Accident & Health
Michael Harrington, Risk Manager, Jabil Circuits
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• Joe Puzzo, SVP Business Development, AIG Accident & Health
- 40 year Industry Veteran/24 with AIG
- Focus on Travel protection for Employer & Participant
Groups
- Fairfield University (BA History), American College (CLU &
ChFC ).
• Michael Harrington, Senior Director Risk Management and
Attorney, Jabil Circuits
- Prior Roles; Risk Manager for Textron and EMC
- Retired Major from 10th Special Forces Group (Airborne)
- Norwich University (BA History), Harvard (MA Government),
Boston (JD Law)
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What to Expect
• Understand potential exposure.
• What are the key considerations?
• Risk Mitigation Planning: a real time example.
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Why Worry?
• Travel increases vulnerabilities in a risky world
• Political, environmental, cultural, technical
unknowns
• Crime and corruption
• Health and safety laws
• Duty of Care – issues facing the Risk Manager
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Why Plan?
Obtaining medical treatment
and hospital care abroad can
be expensive, and medical
evacuation to the United
States can cost more than
$50,000.1
Workers who travel more than
20 nights a month were 2.61
times more likely to report
they were in poor or fair
health than those on the road
one to six days a month.2
Seventy-nine adverse incidents
of violence involving U.S.
citizens and interests abroad
occurred in 2011; seventy-eight
are believed to have resulted
from intentional targeting of
Americans.3
Only 86 percent of 2011 U.S.
domestic flights departed on
time; nearly two in 100 were
canceled.4
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The Reality of Today’s Travel
Environment
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One in eight U.S. adults (12%) either had
their travel impacted, or considered
changing their travel plans, due to natural
disasters or world events since summer
2010; less than 30% of impacted travelers
had travel insurance.1
In 2012, 98 incidents of political violence
that occurred abroad involved U.S. citizens
and interests; 91 are believed to have
resulted from intentional targeting of
Americans.2
A 2012 survey also revealed that 18 - 34
year olds were most likely to have their
travel plans impacted by natural or other
world events, followed by college graduates
(17%) and parents of children under 18
years of age (16%). 1
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Obtaining medical treatment and hospital
care abroad can be expensive, and a
medical evacuation to the United States
can easily exceed $10,000 or more
depending on the patient’s condition and
location.3
The average cost of a nurse escort from a
European location is $24,000.4
Passengers filed approx 1.78 million
mishandled baggage reports with the
largest U.S. air carriers in 2012.5
On-time flight performance has
decreased; only 80% of U.S. domestic
flights departed on time over the last 2
years, a 6% decrease since 2011.6
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Duty of Care – What and Why?
A requirement that a corporation act toward employees and the
public with watchfulness, attention, caution and prudence that a
reasonable person in the circumstances would.
If a corporation’s actions do not meet this standard of care, then
the acts could be considered negligent, and any damages
resulting may be claimed for negligence.
Employers have a duty to protect their employees while
traveling and an obligation for the health, safety and security of
their employees.
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Impact of Legislation
• Employers’ duty and
obligation for traveling
employees
• Defining your “Duty of
Care”
• Consequences if you don’t
fulfill your obligation
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86% of corporate
travelers believe their
firm has a legal
obligation to support
them abroad
Over 50% would
consider taking legal
action in the event of an
emergency being
mishandled
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The Solution is Best Practice
Flexible and Realistic
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Understand potential liabilities and risks
Ensure 24/7 assistance services
Establish procedures for incident handling
Mandate training
Monitor world events
Establish communication channels
Utilize technology to locate employees
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38% of travelers
said they never
do any research
on the country
they visit
78% said they
never carry an
emergency
phone number
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EXPECT THE UNEXPECTED
MEDICAL ASSISTANCE, REPATRIATION, SECURITY
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Global Assistance Services
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Medical
Security
Pre-Trip Planning
Physicians/Dental Referrals
Medical Payment Assistance
Repatriation of Mortal Remains
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Pre-Trip Planning
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Physicians Consultation
Immunizations
Prescription Medications
Contact Numbers
Research the Destination
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Behind the Scenes of an Evacuation
Gather
Information
Monitor and
Communicate
Determine the Need
Plan Logistics
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Gather Information
Information is critical to assessment and success.
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Name and local contact information
Synopsis of current situation
Medical and/or police reports
Travel information (dates, location)
Medical contacts (local & home)
Date of birth, passport & Visa
Travel companion(s) and their demographics
Language needs (client, family, local medical provider)
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Determine the Need
Engage Assistance company for best resolution
Medical team gives a professional assessment:
• Review case and medical report
• Speak with local, treating physician
• Determine adequacy of medical facility, evacuation methods
and travel recommendations
• Language Skills
• Closest appropriate medical facility versus home
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Plan the Logistics
TIMING
METHOD
Acuity
Location
Time of Day
Security
Commercial
Stretcher
Ambulance
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Monitor & Communicate
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Identify home physician/hospital
Secure hospital admission
Review insurance information
Update family/employer/medical providers
Contingency plans
Close loop at final destination
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Manage Your Security
From a Distance
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Global View
Travel Risk
• Crime, Political Unrest, Terrorism,
Natural Disasters, Culture
• 41 countries with Travel Alerts and
Warnings*
• Hot Topics: Syria, Brazil, Egypt
Terrorist
Attacks/Civil
Unrest
Terrorist
Attacks/Civil
Unrest
 Athens
Athens
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 Columbia
Columbia
 Denmark
Denmark
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 Dubai
Dubai
 Ireland
Ireland
 Namibia
Namibia
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Ottawa
 Ottawa
Pakistan
 Pakistan
Russia
 Russia
Spain
 Spain
Turkey
 Turkey
Nigeria
 Nigeria
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How Do You Manage Risk?
• Anticipate/analyze/report
• Create a global system of crisis response &
management
• Train and prepare your employees
• Maintain an effective network of global response
capabilities
• Setup your firm’s ability to
Assess global risk and ability to respond
o Communicate globally
o Locate, assist, and recover personnel
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Critical Elements for Preparation
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“Planning is bringing the future
Increased awareness
into the present so you can do
Destination briefs
something about it now.”
Intelligence reports
– Alan Lakein
Travel updates
Single point-of-contact for emergencies
Redundant communications
Crisis management/response structure
Travel tracking mechanism
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Threat Assessment
• Socio-economic awareness
• Impact of Political, Ethnic, Racial,
Religious, or Tribal Relationships
• Health
• Law Enforcement Capabilities
• Criminal Activity
• Potential for K&R or Terrorist Attacks
• Identify Location “Hot Spots”
• Weather
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Case Study: EGYPT
• Overnight transformation
• Vacation destination,
business hub
• Civil unrest
• Arson attacks
• Security forces
• Breakdown in law and
order
• Border and ports of entry
all closed
• Europeans attacked and
arrested
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Vulnerabilities
• Arriving at new locations
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Airports, Railway Stations, Hotels
Transportation
Unrest (riots or large crowds)
Criminal activity
Assistance expectations (Law
Enforcement/Medical/Gov’t)
• Food/beverage consumption
• Communication limitations
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EXAMPLES
United States:
Boston Marathon Bombing
Algeria:
Terror attack at the
Tigantourine Gas Facility
Colombia:
Employee robbed at gunpoint
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Security Summary
Recognize Potential Dangers
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Maintain/instill high level of Personal Awareness
Know before you go (research cultures/customs, etc)
Vary routines and avoid certain locations
Present a hard target
Keep a low profile but project confidence
Understand communication abilities/limitations
Know your crisis management plan
Practice/update policies and emergency plans frequently
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A Risk Management Perspective
Michael E. Harrington
Global Senior Director of Risk
Management
Jabil Circuit
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Jabil Circuit Has a Global Footprint
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Jabil Circuit Has a Global Footprint
• Global Manufacturing Provider
• 23 Million Manufacturing Sq Ft.
• 60 Sites on Four Continents
• 151,000 Dedicated Employees
• 153,804 Travel Days
• 15,788 Individual Employee Trips
Global Electronics
Solutions For a Changing World
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Jabil’s Blue Chip Customer Base
Diversified Manufacturing
Services
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Enterprise & Infrastructure
High Velocity
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Jabil’s Challenge
About 150,000 global
employees
Remote work
locations
• Metal Grinding
• Hot Plastic Extrusion
• Melted Metal Applications
Expats, Local
Nationals, 3rd Country
Nationals &
Contractors
40 countries of
operations
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Dangerous work –
high potential for
injury
Traditionally
dangerous countries
• Security issues
• Weather extremes
• Poor access to medical
care
• Poor local infrastructure
Over 153,000 Travel
Days between more
than 200 Countries
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The Risk Management Perspective
Setting the Scene – Think Global and Act Local
Compliance/Legal, Tax, and Regulatory Key Questions:
• How do you know your program is compliant from a Tax and Regulatory
standpoint?
• How do you fulfill admitted insurance needs globally?
• How do you effect claims payments outside of the US in the local country, in
the local currency?
• How do you deal with Transfer Pricing – Kvaerner Case and other issues
• Local Expertise: Brokers and Insurers
• Ease of Doing Business for Operational Business Unit
– Business wants to focus on core activities
– Business does not want the extra duty of insurance placement or compliance
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The Risk Management Perspective
Structural Considerations
• Where is the company located, and where does it conduct
business?
Admitted Jurisdictions – India, Brazil, etc
o Non-Admitted Jurisdictions (keep an eye on taxes) – Canada,
UK, Singapore, etc
o Hybrid Jurisdictions – Germany, Italy, etc (for professional lines)
o What insurance is required locally?
o What personal liability risks exists? (BTA, Side A D&O)
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Duty of Care for all Employees
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Institute Corporate Travel Policy
Starting Point – Travel Policy
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Clearly outline parameters
Forbidden countries (extreme risk)
Restricted countries (very high risk)
• Prior approval from Executive Committee
• Only with approved security/transportation arrangements
• Approved modes of travel
– Restriction of commercial airlines in some African nations
– Charters (prior approval required)
• Aggregation of employees on planes
– Max total per conveyance
– Max number of Board/Executive Committee members
• Clear approval process for exceptions to policy
– Head of business
– Executive Committee
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Communication
Keep it simple!
One membership card for all Employees Globally
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Service Providers
Insurance Partner - Business Travel Accident (BTA) Coverage
• Out of country medical expense coverage
• Medical evacuation/repatriation
• Understand what policy covers
• What does evacuation mean?
• Accidental death & dismemberment coverage
• Travel concierge services
Security firm (can come packaged with BTA)
• Security advise/support
• Security evacuations
• Travel intelligence
Kidnap & Ransom Insurance (K&R)
• Insurance coverage
• Specialist consulting for employee recovery
• Incidents need to be handled differently
Create Service Protocol for vendors
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Lessons Learned
No such thing as enough training!
Close working relationships are key (internal/external)
Pre-planning will help to work the bugs out
Learn from each incident
No two incidents are alike
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A Plan that is Strategic
Risk Mitigation Is:
• Deliberate and thoughtful
• With a focused, documented plan
• With protocols and review points
Done Correctly It Is:
• 3 Rights: Care/Response, Time, Location
• Mitigates corporate exposures
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THANKS FOR YOUR TIME
Questions?
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