Owners'
Insurance
Forum
Urban Hotels, Exterior Corridors Create Security Issues
REGION: Northeast Owner Profile
ROOMS: 3,500
HOTELS: 11
REVPAR: $90
BRANDS: Intercontinental. Marriott
CHALLENGE: Enhancing guest satisfac-
tion, security and safety.
First and fbremost among the goals of
hotel owiiers is to provide guests with a
comfortable and sectiie environment.
But one owner stated that the news
media has unfairly portrayed hotels as
being stiiprisingly tins;ife places. The use
of sectiiity cameras helps make this
owner's properties more secure. Howev-
er, security tended to be more of issue
wben it owned exterior corridtjr proper-
ties, which can cause some security issues
with easy room break-ins. Downtown
properties iti urban areas are also more
Tracking Changing Regulations Difficult With Multi-State Portfolio
REGION: East Owner Profile
ROOMS: 13,750
HOTELS: 112
REVPAR: $56
BRANDS: Hyatt. Hilton, Starwood
CHALLENGE: Keeping current on the
changing regulatory environment.
A lot of owneis have properties in
nitiltiple states and each state has its
own regtilations that an owner must
keep up-to-date on. This has caused
problems for this owner in certain
states where the regulations regarding
hotels are seemingly changing all the
time. As a result, the company must
employ several people to keep track of
the fluctuating regulations. If the com-
pany does not stay familiar with the
regulations it is susceptible to fines.
This owner has rtui into such prob-
lems ill tertaiu states, such as Florida,
at risk, tbe owner said. The company fur-
ther pointed oul that at ils major down-
town hotels, news media can sometimes
be an issue when a celebrity ai rives.
SOLUTIONS:
Set uiily breaches are getting increased
media attention and with increased
scrutiny comes pressure to assure your
gtiests of their safety. The first step is to
condtict a sectnity audit to identifv' any
points of potential breach, wbelht-r it's
exterior corridors or your master key sys-
tem. Physical measures such as imple-
menting cameras at remote entrances,
expanding your exterior lighting or
adding trained security guards can re-
duce some of your WOIT y. But look for a
robust package of insumnce that will re-
spond with protection if such an event
does occui; C'overages to look for can in-
(liide crime coverages. ev"aciiation ex-
ibai change regulations moi't- than
most. Meanwhile, in Indiana, the
owner said that even if an employee is
terminated during tbe first :^0 days,
tbe ex-employee can sue the company
for wrongful termination. This was a
little-known fact because most states
allow for any kind of termination dur-
iug the first 30 days of employment.
To avoid sucb a mistake, tbe owner is
trying to be as proactive as possible.
SOLUTIONS:
Keeping up witb changing regula-
tions can be a cliallcuge. Tbe fu si step
is to identily areas that are vulnerable,
including immigration, labor prac-
tices, building ordinances or even the
Environmental Protection Agency.
Once the owner knows where they are
vtilnerable due to change, they need
to identify a process for stayitig on top
of changes. They can use hotel associ-
pense covc'iage, coverage for your guests'
property, (overage to rckey your master
key if it is lost or stolen (or to replace ele-
ments of your electronic key system), lia-
bility and crisis management insurance
to cover your public relations expenses if
an incident occurs that causes media at-
tention. Yotir insurance agent and carrier
can assist you in conducing a sectirity
atulit and recomiuending st)lutions for
reducing voiir set urity ihicats.
ations, online hotel industry newslet-
ters and insuiaiice company vvebsiies.
An owner sbouki employ a giotip
of formal and informal advisors stich
as attorneys, accotuuants and insur-
ance agents to piovide the company
with early warnings and advice on
developing best practices. Putting to-
gether an action plan for responding
to changing regiihuions is ihe key lo
smoolhly i esponding. lint respond-
ing to regulatory change can be cost-
ly. Take a look at the insurance cov-
erage to be certain that you've put in
place the insurance you need tr)
cover the costs of changes and mis-
takes in handling. Yotir insurance
agent can help yoti identify the best
combination of coverages such as
E&O, D&O, Building Ordinance in-
surance, real estate tax, increased as-
sessment or other options based on
" situation.