Mass shootings, like the one this week in San Bernardino, Calif., are becoming so prevalent that your company can now buy insurance to cover them.
Three months ago, Willis, a large insurance broker, began selling policies that cover gun violence. The policies are called active shooter insurance. Willis originally pitched the insurance to universities, but over the past few months, the brokerage has been receiving inquiries from hotels, hospitals, and other institutions.
“There’s been widespread interest in the product,” says Wendy Peters, an executive vice president at Willis. She says recent incidents have raised the awareness for the need for this type of insurance.
Active shooter insurance covers the liability that companies or institutions have if they are found not to have taken the needed precautions to prevent gun rampages. It also covers the “on the scene” costs of a shooting incident, as well as the expense of any counseling or consulting that would be needed after a tragic event. Peters says the maximum liability that the policies cover is $5 million. Right now, the only insurer underwriting the insurance is Beazley, which is an affiliate of Lloyd’s of London.
Workers compensation insurance policies, meanwhile, have long covered the medical costs of employees who are injured at their workplace. These policies cover anyone who is shot on the job, whether it was an accident or purposeful mass shooting. That’s true even if the company isn’t found to be liable.
Peters says that active shooter insurance policies are so new that she hasn’t tracked how many policies have been sold, and couldn’t quote an average premium for the policies.
Despite the introduction of these policies, experts say the insurance industry has not responded much to mass shootings. And George Mocsary, who studies insurance and gun violence at the Southern Illinois University School of Law, says that insurers have not raised their rates for workers compensation insurance based on gun violence. The reason is that mass shootings are thankfully still a small portion of the number of injuries that befall workers.
According to the Department of Labor, 4,679 people were killed in the workplace in 2014. The vast majority of those were accidents. According to 2013 statistics from the union AFL-CIO, 773 workplace deaths were the result of violence. That’s out of 3.8 million workplace injuries that the union says were reported in 2013. And despite the headlines that shooting incidents attract, the number of workplace homicides have actually fallen over the last five years.