Biomedical Engineering Reference
In-Depth Information
3. What liability insurance coverage is available?
a. Could the institution be held liable to
third parties for contributing to loss
by failing to take appropriate protective
measures or for negligence (e.g., failure
to take appropriate measures to prevent
the spread of infection within the facility;
failure to provide adequate evacuation
routes)?
b. What are the limits to the institution's
liability coverage? If the limits are deter-
mined on a per-occurrence basis, how is
an “occurrence” defined in the policy?
c. Should the institution consider an umbrella
policy (i.e., excess liability insurance) to
protect it in the event of a large catas-
trophic loss?
4. What business-interruption insurance is avail-
able?
a. How will the organization's lost business
income be measured? What documentation
is required to establish a loss?
b. Does the organization's policy specify a
time period for coverage, or is it covered
until operations resume?
•
For example, Loss of business income
due to supplier interruption?
d. What costs are covered?
•
For example, Premium prices paid in
order to maintain minimal operations or
facilitate recovery; salaries; other oper-
ating expenses?
•
For example, workers' compensation;
health and life insurance costs?
D. Declaration of an Emergency or Major
Disaster, and Securing Disaster Funds
Large-scale emergencies
49
and major disasters
50
are
declared by the President of the United States,
upon request from the governor(s) of the affected
state(s), and must “be based on a finding that
the [emergency or major] disaster is of such
severity and magnitude that effective response is
beyond the capabilities of the State and the affected
local governments and that Federal assistance is
necessary.”
51
Less-serious disasters can be declared
by the Small Business Administration (SBA), which
coordinates disaster assistance for businesses.
52
Business can apply for several types of disaster-
assistance loans (including pre-disaster mitigation
loans), depending on the nature of the disaster and
the amount of damage suffered.
53
Disaster assistance
for individuals is coordinated through FEMA.
54
c.
Is the organization covered if the business
loss is not a result of insurable peril such
as a fire?
•
For example, Loss of business income
as a result of evacuation in response
to civil authority in the event of a bio-
terrorist attack?
1. Has the President of the United States declared
an emergency or major disaster, triggering
federal response mechanisms (including SBA
and FEMA)?
49
An “Emergency” for purposes of obtaining federal funding, is defined as “any occasion or instance for which, in the determination
of the President, Federal assistance is needed to supplement State and local efforts and capabilities to save lives and to protect property
and public health and safety, or to lessen or avert the threat of a catastrophe in any part of the United States.” 42 U.S.C. § 5122(1)
(2004).
50
For purposes of obtaining federal funding, a major disaster is defined as “any natural catastrophe (including any hurricane, tornado,
storm, high water, wind-driven water, tidal wave, tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm, or drought),
or, regardless of cause, any fire, flood, or explosion, in any part of the United States, which in the determination of the President
causes damage of sufficient severity and magnitude to warrant major disaster assistance under this chapter to supplement the efforts
and available resources of States, local governments, and disaster relief organizations in alleviating the damage, loss, hardship, or
suffering caused thereby.”
Id
. § 5122(2).
51
Id
. § 5170.
52
See
U.S. Small Business Admin., Understanding How Disaster Declarations Are Made,
at
www.sba.gov/disaster_recov/basics/
declarations.html (last visited Sept. 20, 2004) [hereinafter Understanding How Disaster Declarations Are Made].
53
See
15 U.S.C. § 636(b) (2004).
54
See id
. § 636(b)(1)(C); Understanding How Disaster Declarations Are Made,
supra
note 52.
