This seemed contradictory to other newscasts, which feature stories on how everyone else is responsible for the troubles we cause ourselves: suits against the fast food industry alleging complicity in making so many people fat, rising healthcare costs that are at least partially caused by unhealthy lifestyles, and the number of highway deaths that might have been averted if driver and passengers had been wearing seatbelts.

           I think it's ironic that one announcer is talking about “personal risk management” while others are offering examples of individuals failing to take personal responsibility for just about anything they do—and seeming to expect corporate America or the insurance industry to pick up the pieces.

Today businesses must be increasingly vigilant about how their actions impact others and are viewed from the perspective of their shareholders, employees, business partners, and customers—as well as by the general public.

This is true even when the injury is caused by natural disasters or disease. (Think SARS for now, although it's hard to tell what the next disease du jour will be.)

Take for example, a situation in which a company sends an employee on a business trip outside the United States , and the worker contracts a contagious disease. What if she subsequently infects other members of her family, business clients, and even members of the public when she returns home?
If the company is sued for the pyramiding losses, will its various insurance policies respond?

One line of financial defense could be the corporation's directors and officers liability insurance, which is designed to respond to allegations such as error, omission, or breach of duty. Most D&O policies, however, contain exclusions for bodily injury on the premise that such injuries should be insured through general liability insurance. The wording of this exclusion differs from policy to policy, with some providing limited coverage and others, no coverage at all.

For example, what if an epidemic happens, and the spreading infection causes the company to lose business and, ultimately, value? Or what if a food-service company were quarantined because of fears that the disease would spread even further because of a contaminated employee?

Shareholders of a public company, or financial partners of a private company, could file an action based on failure to avert the spread of the disease, which led to the loss of business and subsequent loss of value.

Those with a financial interest in the company could allege that management should have taken precautions to avert the damage, such as canceling all foreign business trips once the disease became known.

One type of D&O bodily injury exclusion precludes coverage for all losses in connection with claims “alleging, arising out of, based upon, attributable to, or in any way involving, directly or indirectly” bodily injury.

Another policy may state more simply that losses connected with claims “for” bodily injury are excluded.

Although each is considered a bodily injury exclusion, the first probably precludes coverage for even a derivative action based on loss of value if the loss arises from bodily injury.

The second exclusion most likely would void coverage only for the individual claims of illness but not necessarily for the derivative action alleging loss of financial value.

Both policies have bodily injury “exclusions,” but each could lead to a different financial impact. The difference is critical to the grant of coverage.

From the public's standpoint, the spread of infection could fall within the coverage of a corporation's general liability policy, which is written to specifically address loss arising from bodily injury and property damage.

Absent an intentional desire to spread the disease, a business and its insured employees probably would be covered by the CGL policy for negligently spreading the illness to the public.

One possible limitation is the pollution exclusion, which applies to the migration, dispersal, escape, or release of pollutants. The typical CGL policy defines pollutants as a solid, gaseous, liquid, or thermal irritant or contaminant, categories that bacteria or virus possibly could fall within.

Many courts, however, have confined this exclusion to environmental damages, not to the spread of bacteria or virus. At the least, the corporation should have defense coverage under a CGL policy for such a lawsuit.

Although concern for the public is critical, the risk to the employee is, of course, the most obvious. CGL policies exclude coverage for bodily injury to employees, as well as to family members of employees who are consequentially injured. They also exclude injuries that fall within the realm of worker's compensation laws.

Worker's compensation insurance typically addresses employee injuries whether caused by accident or disease.

In general, employees who are subjected to an infectious disease in the course of employment should be entitled to worker's compensation benefits. But what if the employee caught the disease while traveling outside the U.S. ?

Employees who are hired in the U.S. usually are covered by the worker's compensation laws of their state of hire—even if they travel temporarily outside this country. That's because part one of the typical worker's comp policy (as drafted by the National Council of Compensation Insurance, Inc.) does not have a defined coverage territory such as is contained in other insurance policies.

However, the NCCI policy does state that it applies to injury arising from the locations listed on the policy as well as workplaces that are not listed but are within the states designated for coverage.

So, in order for coverage to apply to exposures outside those states, the employee generally must have been hired in one of the listed states and be assigned to a worksite that is insured. There is no prohibition of coverage for exposures that arise from employees who travel temporarily outside those locations.

           There's more to it, however.

           The employer's liability section of this insurance addresses consequential injury to the employee's family members.

           This section restricts coverage to injury occurring within the U.S., its territories or possessions, and Canada . There's an exception, which provides coverage for temporary foreign exposures.

The policy does not define the term “temporary,” so it's important for the underwriter handling the policy to understand the extent of foreign assignments.

In many cases, additional coverage will be necessary to adequately cover situations in which employees are assigned outside the United States for longer durations. It's necessary for risk managers to check with the carrier when any foreign travel is planned.

And that's about all that a corporate risk manager or insurance buyer can do. The world and its risks are rapidly changing—as pointed out by that newscaster. All we can do is continually try to impress on senior management that they may increasingly be faced with having to take corporate responsibility for public health issues—even when individuals do what they can to minimize their own risks.