Insurers offering “active shooter” cover as stand-alone policies
Insurers report widespread interest in “active shooter” policies, a stand-alone insurance against a person or persons who kill as many people as possible. While many insurers offer this coverage under workplace violence, some, such as XL Catlin, GDP Advisors, and Willis Towers Watson are now offering specific “active shooter” policies, which generally offer $5-$20m to cover legal and reputational costs as well public relations, employee counselling, and funeral expenses.

You're at a hospital when the intercom spits out "code black," but it doesn't mean a crash cart is coming. Instead, you should duck and find cover. Code black could mean an active shooter is in the building.

Welcome to the new world of fear, where grade schoolers are taught to stand on toilet seats when the alarm sounds. Insurance companies are also confronting "code black," as claims flood in from tragedies like the Orlando massacre for death, disability, business shutdowns, workers' compensation and the inevitable lawsuits from victims' families and survivors.

There's also the sure knowledge that in a department store, movie theater, sports stadium or university, in fact, anywhere people gather, this will happen again.

"It's horrible to think that any public place we go is now a 'soft target,'" said Greg Boles, a security consultant with corporate investigations firm Kroll. Boles was previously in charge of the Los Angeles Police Department's threat management unit and handled counterinsurgency for the U.S. Department of Defense in Afghanistan.

Insurers are preparing for this eventuality in two ways. Some, such as XL Catlin and GDP Advisors, now offer specific "active shooter" policies. And one of this country's three largest insurance brokers, Willis Towers Watson (WLTW), also markets them, backed by a British underwriter affiliated with Lloyd's of London. Willis reports "widespread interest in the product."

Other insurers offer this coverage under "workplace violence," but stand-alone insurance against a person or persons who kill as many people as possible is a relatively new idea for the industry.

Unfortunately for the lone worker sitting at his or her desk when an angry gunman walks in, the purpose of these policies is to help businesses mitigate the results of a mass shooting. Insurers generally offer from $5 million to $20 million to cover legal and reputational costs, employee counseling, funeral expenses and to provide public relations.

If this sounds like a lot of money, consider the San Bernardino shooting where 14 people were killed and 22 injured in a city already in the throes of bankruptcy. "Many claims against the city, including those resulting from the shooting incident, are now in question," said Ben Tucker, who handles crisis management at XL Catlin.

However, employees -- and the general public -- do benefit. Insurers make money by protecting businesses against the cost of tragedies like those in Orlando and San Bernardino. Because insurers don't want to pay off if they don't have to, they have a vested interest in preserving lives and property from the shooter who comes in prepared to do as much harm as possible. That's why they provide security consultants like Boles.

But money isn't the only consideration. The insurance industry still recalls that almost 500 of its members lost their lives in the 9/11 World Trade Center apocalypse. "In a perfect world, I'd hope we'd never have a claim," said Chris Arehart, workplace violence manager at Chubb (CB), a major property-casualty insurer.

But he can read the grim statistics as well as anyone. An FBI report on active shooters that only went up to 2013 showed that incidents had tripled. In that time more than 1,000 people had been shot and half of them killed. "Unfortunately, the time between shootings is getting shorter," said Arehart. There were 332 alone in 2015.

So Chubb, Kroll and the others are already preparing for -- and trying to prevent -- the next one. Here's their advice:

Every company should develop a comprehensive strategy for coping with a potential terrorist and then implement it.

Put together a "threat assessment team," including managers, floor fire marshals, the property owner and, if possible, a professional security expert -- an outsider who can poke holes in any plan without fear of being fired.

Implement "'tabletop exercises" that plan for every eventuality and conduct them with all employees.

Learn how to lock down the building and floors and how to escape using at least two ways out.

Don't bunch up outside the building to be counted -- as you would in a fire drill. This could provide additional targets for a killer.

Place emergency phones at key locations because ringing cellphones alert the assassin.

Create "safe" rooms and ensure that they won't become killing fields.

Place "trauma kits" that contain more than band aids and aspirin in key locations, and train employees on how to stem hemorrhage.

When all this is completed, conduct dry runs to find the "curve balls," as Boles referred to them. In one case, the only person who had the keys to lock and unlock the doors was a single janitor, who could have been anywhere in the building. Make sure that crucial members of any response team have a backup in case they're out sick, injured ... or killed.

Employees should be encouraged to report their suspicions even if they prove to be unfounded. A person who is radicalized may be able to hide his or her beliefs, but a potential murderer/suicide is likely to give away something: anger at the boss or a group, or an "everyone's against me" mentality.

What's the tipping point between normal griping, which occurs at every workplace, and mass violence? "It's someone who creates intimidation and is causing fear," said Arehart. "He or she is lashing out at others and destroying property."

Remember that active shooters don't necessarily have to be associated with a radical sect, said Boles. They can be customers, co-workers or people who have a personal relationship with an employee. Shootings often start as domestic disturbances. Experts will go on debating the definition of an active shooter, said Tucker, but the real question is: What if it happens?

If it seems that no safety measures are happening at your office, plant or place of business, remember that some precautions take place behind the scenes because the company doesn't want to appear unfriendly, or it doesn't want potential killers, even those among its own staff, to know.

But others are obvious, such as "hardening" the exterior with bollards to prevent a truck bomb, security guards with mirrors to look under cars, badging systems that change as people leave the company and steel doors with the nameplates of executives removed.

If none of this is occurring at your workplace, employees should go to their human resources department and ask why not, or contact their union representative if that's more comfortable. Local law enforcement may be enlisted to reinforce the need for such a plan with management.

If the company does nothing, employees should turn to each other and discuss options. The first one is flight: Get out of harm's way as quickly as possible. The second should be to barricade and hide. Stop killers before they can get into the room you're in, or hide in a place where you expose as little of yourself as possible.

When all else fails, the last option is to attack with whatever you have at hand. If you have to, throw a stapler or tape dispenser.

"Good luck with that," said Boles.