Please answer the following through the chapter pdf Chapter 15 Prompts – Answer ALL of the following:1. Describe four different types of insurance coverage other than health/dental/vision that would be needed for a hospitality, recreation, or tourism business or organization, and discuss the importance of each (write full sentences in paragraph form and include details from Chapter 15 in your own words to support your statements in every posting).2.Describe some of the changes in the global insurance market and global legal climate that are forcing underwriters and hotel managers to re-examine their insurance coverage (write full sentences in paragraph form and include details from Chapter 15 in your own words to support your statements in every posting).3. Discuss four ways that hospitality, recreation, and tourism agencies worldwide can manage risk more aggressively and consistently (write full sentences in paragraph form and include details from Chapter 15 in our own words to support your statements in every posting).
© 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Chapter 15 Managing Insurance Images used under license from Shutterstock.com © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Managing Insurance Introduction To Insurance Types of Coverage Selecting an Insurance Carrier Selecting the Insurance Policy Policy Analysis © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved In This Chapter, You Will Learn: 1. To understand the value of insurance in protecting a business from financial loss. 2. To become familiar with the different types of insurance required of hospitality operations. 3. To understand the role of workers’ compensation and the requirements of an employer. 4. To critically evaluate the financial rating of an insurance company and other information to help you select an insurance carrier. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved In This Chapter, You Will Learn: 5. To distinguish between the terms “primary” and “umbrella” insurance coverage and determine appropriate amounts of coverage. 6. To analyze an insurance policy and determine what types of claims will be covered and what types of claims will not be covered. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Insure (Insurance) - To protect from risk. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Insurance involves the spreading of risk from one person or business to a larger group. Makes good financial sense May be required by law or by lenders © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Four Fundamental Principals 1. Type of hazard must be faced by a large number of individuals or businesses 2. Monetary value must be calculable against an accepted standard 3. Premiums must be affordable 4. Infrequent risk at any given time © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Actuary - A mathematician or statistician who computes insurance risks and establishes premium rates. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Insurer - The entity that provides insurance. Insured - The individual or business that purchases insurance against a risk. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Premium – The amount paid for insurance coverage; can be paid in one lump sum or over time, such as monthly. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Policy (Insurance) - The contract for insurance agreed upon by an insurer and an insured. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Annuity - Fixed payments, made on a regular basis, for an agreed-upon period of time or until the death of the recipient. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Indemnification - To insure against possible liability and loss and/or to compensate financially for losses incurred. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Introduction to Insurance Legalese: Claim - Demand for money, property, or repairs to property. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Purchasing Insurance 3-Step Process Reach out to an independent insurance industry expert. 1. Determine the type of coverage you need. 2. Determine the amount of coverage you need. 3. Select a financially sound insurance company. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.1 Samuel Renko, president of the Senframe Hotel Management Company, authorized the purchase of a $2 million fidelity insurance policy, the purpose of which was to protect the company in the event of employee theft or fraud. In discussing the purchase with the insurance agent, Jana Foster, Mr. Renko assured Ms. Foster that all hotel controllers were subject to a thorough background check before they were hired. As a specific condition of the insurance policy, background checks on controller candidates were required prior to employment. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.1 The insurance policy was purchased and went into effect on January 1, 2011. On June 1, 2011, the Senframe Hotel Management Company took over the management and operation of the Roosevelt Hotel, a 300-room property in a resort area. As part of the operating agreement, with the Roosevelt Hotel's owners, the hotel's controller and its director of sales were retained by Senframe. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.1 On December 20, 2011, Senframe management discovered that the Roosevelt Hotel's controller had been creating and submitting false invoices. The invoice payments were deposited in a bank account he had established for himself five years earlier. Total losses for the five-year period that the falsification occurred were over $500,000. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.1 The controller resigned, but the hotel owners sued Senframe for the portion of misappropriated funds ($70,000) taken during the period the hotel was under Senframe's management. Ms. Foster maintained that her insurance company was not liable to indemnify Senframe, because the controller had not been subjected to a background check, as Mr. Renko had promised. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.1 Mr. Renko countered that the controller, although not background checked, had no criminal record of any kind, and thus a background check would not have prevented the hotel from hiring the controller. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.1 1. Must Ms. Foster's company defend Senframe in the litigation brought by the hotel's ownership? 2. If you were on a jury, would you hold Senframe responsible for the employee theft? 3. Regardless of the outcome of this situation, what changes in operational procedure should be implemented by Mr. Renko and the Senframe Hotel Management Company? © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Types of Coverage Property-Casualty/Business Interruption Liability Employee Liability or EPLI (employment Practices liability insurance) Dram Shop Health/Dental/Vision Workers’Compensation Data Breach © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Types of Coverage Legalese: Course and Scope - The sum total of all common, job-related employee activities dictated or allowed by the employer. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.2 Christina Fleischer was 16 years old when she was hired to work as a busser for a private country club. On Sundays, the club operated a popular brunch that served 500- 1,000 people between the hours of 9:00 A.M. and 3:00 P.M. On Ms. Fleischer's first day of work, her supervisor quickly detailed the job requirements. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.2 As part of her job, Ms. Fleischer was to remove the guests' used dishes from the table, take the dishes to a bussing station, and scrape any leftover food from the dishes into a garbage receptacle lined with a plastic trash bag. Periodically, she was to bring the dishes to the kitchen to be washed, and take the garbage receptacle to a designated area where she would then remove the plastic trash bag and replace it with an empty one. © 2017 Stephen C. Barth P.C., Diana S. Barber, JD and John Wiley & Sons, Inc. All Rights Reserved Analyze the Situation 15.2 The filled bags were left in the designated area until they could be taken out to a dumpster by a member of the dish room staff. The garbage receptacles would often get very heavy, and all bussers were instructed to replace the plastic bags in them when they were half full. Ms. Fleischer’s supervisor made it a point of mentioning that during their 15-minute training session. © 2017 Stephen C.