Canadian Underwriter

Expecting the Unexpected

July 1, 2006   by Marc Sand, CEO, V.I.P. Protection

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Preparing for acts of terrorism is now more important than ever. Today, given our country’s increasing involvement in global political and military affairs – including the sending of Canadian troops to Afghanistan or aiding the United Nations in a humanitarian mission to volatile countries – we must all realize the threat of harm as a result of terrorist activities is real and near. It does not lie across the border, but awaits us, Canadians, within our cities and towns, risking our citizens and our children.

Risk Managers, underwriters and brokers must be properly educated on how to evaluate current threats and how to understand the necessary steps needed to deal with these threats. There should be continual training and distribution of intelligence to update risk managers with current vital information about the global risk of terrorism and which specific threats may cause harm to people and/or businesses interruption.

Insurance companies, public and private corporations, institutions and public works of any kind must assist themselves in creating internal defense systems. They must avoid apathy and put into place anti-terrorism policies and procedures; more importantly, they must test these policies and procedures at least once per year, just as people practice fire drills in schools and businesses around this great country. These drills, tests and exercises are the only way to ensure people are aware of the steps they must take in the event of a terrorist attack or natural disaster.


In today’s world, corporations may be vulnerable to a variety of attacks and threats from a wide range of antagonists. For example, these attacks may be the result of threats from ex-employees, leading to workplace violence. They could also include: hostile acts of sabotage by militant environmentalists; money-laundering schemes conducted by organized crime; theft of corporate proprietary information; and extremists’ mindless acts of terrorism.

Unfortunately, no matter where you live in today’s world, each and every person faces the fear of experiencing an act of terrorism. Our societies, businesses and corporations seem to evolve at an astounding pace, but frighteningly terrorism seems to be evolving at an even faster pace.

Terrorism touches on many underlying themes and motivations: nationalism; religion; state-sponsored violence; political ideology; narco-terrorism; and economic or financial security (or lack thereof). Terrorists seizing on these motives are building growing, self-justified organizations whose aim has one underlying goal – to gain publicity by creating havoc and driving fear within society’s normal and law abiding citizens. Terrorists’ tactics include attempts to coerce corporations, organizations or governments to change key policy decisions without losing the sympathy of their followers and supporters.

For example, every corporation with an office in Mexico City is well aware of the risks of kidnap and ransom. These corporations have taken out the necessary insurance policies for such events, ensuring that their liability and risk is minimized. The same should hold true for the risk of terrorism, since this threat is found throughout the world and is not isolated to one or two distant locations. Any corporation that communicates by telephone, fax, e-mail, etc. is at risk being the target of terrorist activities – especially if such businesses are represented globally and attract large amounts of media attention.

And yet, the vast majority of corporations’ policies and procedures related to security and emergencies from an attack or natural disaster are not current. All areas of policies and procedures must be continuously updated and their implications reviewed. For example, it is not sufficient for an organization to have money-laundering policies in place for investments over CD$1,000 without concerning themselves about other aspects of their business. They must go further and analyze all areas of their business – such as their information infrastructure, for example – that, if compromised, could have devastating and terminal affects on their business.

It is vital to review such policies at least once per year and consult with a certified expert within these specialized fields. Many so-called specialists do not have the required level of training and experience to study, review, propose and implement complex and interwoven policies and procedures.

Within Canada, there are but a handful of legitimate security specialists to properly create and implement such policies and procedures.

Obtaining credible and reliable information is an important component of policy-making. American corporations are now strongly relying on information provided by several government agencies that monitor terrorist activities around the world. The agencies provide the public with a first level of safety, but that is not always enough. These agencies face problems similar to corporations and businesses: a lack of internal communication reduces their efficiency and effectiveness. Due to budget constraints and untrained staff, only a few agencies around the world are capable of determining if the data they are collecting is information or intelligence.

Collected data, which has been evaluated and released to the public, is deemed to be information. Intelligence is data that law enforcement agencies use to help fight and avoid possible future terrorist attacks.


What society requires is for experts from separate fields of expertise and levels of law enforcement to cooperate with one other. They need to share their expertise and create the best possible defense against any possible threats, not only the ones from terrorists.

Events in Toronto, ON on June 3 illustrate what I mean. Police officers made several arrests throughout the GTA area related to allegations of using explosives in support of terrorist activities. In this scenario, the cooperation and communication among our different levels of law enforcement agencies prevented an imminent attack that would have made the April 1995 Oklahoma City bombing seem small by comparison. The Oklahoma City bombing was executed with one-third of the amount of ammonium nitrate recently seized in Toronto. The Oklahoma City bombing killed 168 people, including 19 children and one person who died in the effort of rescue. More than 220 buildings sustained damage on Apr. 19, 1995. Imagine the wider devastation these people intended in Canada. The victims could have been you, your spouse, relative or children.

Public awareness to vital facts is very important in being pro active. The public is not educated as their only source of information comes from television, radio or newspaper. More then ever we need to be aware of all circumstances. Such awareness must be reflected in policies and procedures designed to minimize the risk and damage of such attacks.

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