The FBI uses the term “mass murder” and defines it as an event where four or more individuals are killed in a single event, usually in one location or within multiple sites that are in close proximity of each other (e.g., different offices or floors in particular setting like a school, office or mall). However, the FBI does not have formal definition for a mass shooting.

Mass Shooting Tracker, which uses multiple sources to track shooting incidents, defines a mass shooting as “an incident where four or more people are shot in a single shooting spree.” The organization believes the differentiation is critical because even though victims may not die, they were shot and could have lasting repercussions from the shooting event.

Gun Violence Archive, a non-profit that collects statistics from the media, law enforcement, the government and other sources, identifies a mass murder as an incident involving at least four people who are killed, not including the shooter.

Why does this delineation matter to insurers? The terminology could impact the type of coverage that applies, as well as any exclusions insurers have determined for mass shooting events.

A gunman killed 58 people and injured 441 from a hotel room in the Mandalay Bay before taking his own life. The victims were attending a country music concert. (Photo: Shutterstock)

Mass shooting exposures

Early estimates following the massacre at the Mandalay Bay hotel  in Las Vegas indicate that event could cost insurers more than $1 billion due to the resulting claims.

Among those who could have exposures following the shooting at the Mandalay Bay are the concert organizer; MGM, who owns the hotel; the manufacturers of the gun, ammunition and bump stock used by the shooter; and his estate. Others who could have liability include the ticket promoters, unless there was a warning on the tickets indicating that concert goers attended at their own risk (more venues are using this type of disclaimer now); and possibly even some of the performers at the festival, explained Wayne Coffey, president and CEO of Coffey & Company based in Hunt Valley, Md.

“No coverage will apply unless you have active shooter insurance,” he continued. “However, workers' compensation will apply for employees of MGM and the concert promoter.”

With the advent of active shooter policies, insurers will use that as a reason to deny some of the claims. In order to close some of the claims quickly, Coffey said that MGM may also settle some where it is prudent.

Commercial liability & workers' comp

For businesses, commercial liability policies may cover some of the property damage from a mass shooting, and business interruption will cover disruptions if an area is shut down for an extended period of time, an airport is closed or other events are cancelled or scaled back.

Another issue involves who pays for the clean up after a mass shooting incident and whether or not it is covered under a general liability or property policy. Business interruption insurance could also come into play after a mass shooting.

For first responders like police officers and paramedics who may suffer the effects of PTSD following a mass shooting incident, workers' compensation coverage would cover treatment. However, individuals who experience shooting events first-hand may only have coverage for PTSD treatment under their health insurance.

Coffey indicated there is no difference in the types of coverage that apply for terror events, the shooting at the Mandalay Bay or the church in Sutherland Springs, Texas. And while mental health issues  can play a part in some shootings, an individual's belief system is also a major driver in these events.

“It doesn't have to be a gun — it can be anything. In New York it was an automobile, in England a hatchet. It's a hard thing to stop. If someone has an ideology, you can't stop them,” observed Coffey.

Related: Dealing with terror

Event managers and hospitality venues are reexamining their policies to better protect their guests and identify unusual behaviors before they pose a danger to others. (Photo: Shutterstock)

Managing the risks

While the national media is more likely to cover shootings involving multiple fatalities, the hard reality is that mass shootings take place on almost a daily basis with multiple individuals killed or injured, according to Mass Shooting Tracker. Many of the victims may be related to the shooter or at least have some knowledge of the individual. Sadly, many of the victims are children.

Coffey said that active shooter policies are in their infancy, much like the workplace violence coverage introduced several years ago. He added that training is going to become a huge aspect of managing the risks associated with these events. This will include training for first responders, individuals working in all aspects of the hospitality and entertainment industry, and adjusters investigating the claims.

He also questioned whether hotels and other public facilities will add metal detectors. “The concert probably had them,” he added, and they are already in place for many sporting events.

Related: Vegas massacre heightens worry about safety at live events

Next steps

The shooting at the Mandalay Bay has prompted hotel chains to reevaluate their “do not disturb” policies for guests. Walt Disney World Properties and Hilton have already begun changing their policies. Walt Disney is swapping out their “Do Not Disturb” signs for “Room Occupied” signs to indicate that someone may be in the room. However, cast members have been instructed to enter each room at least once a day as part of a guest safety and security check. They will knock and notify guests that they are entering the room just to check on their well-being.

Hilton is in the process of updating its policies and encouraging employees to be aware of unusual occurrences such as guests who pay in cash, change rooms multiple times, choose not to have their rooms serviced for several days in a row, or those who might be taking numerous pictures of the interior or exterior of the hotel.

Like the “See something, say something” campaign encourages travelers to be on the lookout for unusual situations in train stations, subways and airports, this same sentiment will extend over into other venues where large numbers of people congregate.

It doesn't mean that people should change where they go, only that they should be a little more vigilant about who is around them and actions that may seem a little out of the ordinary.