This year’s National Travel and Tourism Week, an annual celebration of the contributions and accomplishments of the U.S. travel industry, recognized the innumerable ways in which travel enriches lives and strengthens communities. Participants in the 36th annual celebration included a broad spectrum of businesses in the hospitality industry that contribute to travel and tourism in this country, from hotels and resorts to bed and breakfast operations, restaurants, and bars and taverns. While the focus is on the industry and peak travel plans are just around the corner with summer on its way, it’s a great time to look at some of the exposures the hospitality industry faces and the risk management and insurance solutions available to help minimize these exposures.
Premises liability is a significant issue for the hospitality industry due to the volume of foot traffic, but liability exposure goes beyond just the slips and falls that occur at resorts, hotels and bars. Security and safety is a big issue, including assault and battery exposures, along with the emerging risk of active shooter incidents. Hospitality venues such as restaurants, hotels, and bars are unfortunately now seen as an open target. Just in the last two years we saw 58 people die in a massacre at a Las Vegas hotel’s live event and a deadly shooting at a bar and grill in Thousand Oaks, California. As a result of these events, insurers are now offering active shooter/terrorism coverage with business interruption, brand reputation protection and loss of income.
The #MeToo movement has pushed to the forefront employment-practices issues, with some in the hospitality industry hit with allegations of systemic sexual harassment. In fact, research from a recent study that surveyed employees in the hospitality sector indicated that 89% experienced one or more incidents of sexual harassment in their working life. Of that 89%, over half said the sexual harassment was perpetrated by a member of the public and 22.7% said that it was by a manager. Every organization should be taking a closer look at its employment practices and review what procedures and policies are in place to mitigate discrimination, harassment, wage-and-hour disputes, failure to promote and other pressing issues. A review of an organization’s EPLI coverage is also prudent to determine the scope and extent of its coverage.
Cyber attacks continue to be a significant risk for hospitality operations, with one high-profile incident making headline news earlier this year when it was discovered that personal information of over half a billion individual hotel guests was potentially compromised over a four-year period. Adversaries looking to make a profit from customers’ financial data coupled with industry-specific challenges, such as high employee turnover, make the hospitality sector vulnerable to breaches. This not only threatens the sector’s consumer privacy but also its shareholder value and brand reputation. A robust cyber security infrastructure, along with a broad and comprehensive Cyber Liability insurance solution, is critical to the protection of an operation’s assets and brand.
Other equally significant risks in the hospitality industry to address closely include property damage (fires, hurricanes, earthquakes), food contamination, liquor liability, pollution liability, management liability exposures, auto liability, and on-the-job injuries, among others. RPS is well positioned to provide you with a portfolio of hospitality insurance products for your insureds to protect their customers, employees, shareholders, property, brand and assets. Just give us a call.