The Occupy Wall Street (OWS) movement, which has now spread to anumber of cities across the United States, will test both publicand private entities when claims start rolling in, says onerisk-management expert.

While most cities are accustomed to demonstrations, they may notbe prepared for an ongoing movement like OWS, says Lori Seidenberg,a member of the Risk and Insurance Management Society’s board ofdirectors, who serves as board liaison to the society’s Standards& Practices Committee.

“Something like this could nothave been anticipated by any risk manager,” she says. “I know thereis always a chance of a gathering in a park, but I don’t think aprolonged occupation was on anybody’s radar.”

Seidenberg, also vice president of enterprise risk managementfor Centerline Capital Group in Manhattan, notes that while theperception is that Zuccotti Park is a public space, it is owned bya private organization. “I can’t think that even [the owners]thought this would happen,” she says, pointing out that at anytime, they “can technically pull the plug on this.”

The reason they haven’t, she says, is that the owners don’t wanta negative outcome or to appear to be unsympathetic to occupiers,“even though it’s causing them a lot of grief.”

As well as impacting the park itself, she says the protest has asignificant impact on local businesses. For example, even thoughportable toilets are set up, there are not enough of them, meaningthat protesters frequently request the use the facilities of nearbyshops and restaurants.

This creates more potential for injuries on their premises andfor loss of income, Seidenberg says, adding, “I know a lot ofbusinesses down there are hurting because the usual Wall Streetregulars who eat in the restaurants are staying away. So they havecontingent business-interruption loss.”

Even though those businesses may be losing money, their lossesmost likely would not be covered by their insurance policies, sheexplains, as the loss is not the result of government or civilauthority action.

“I think this is going to challenge some coverages if peoplecan’t get to the area or choose not to go there, or if it gets sobad that the city closes the park for health reasons. There is alot of gray area in coverage, and it should be interesting to seewhat the carriers decide,” she says.

And with potential liability issues, Seidenberg notes there areeven more gray areas. Should someone be injured, such as ademonstrator, area employee or resident, “it is a privately ownedpark, so you would think the first recourse would be against thepark owners—but the city is definitely involved.” She wonders ifthere is an indemnity agreement between New York City and the parkto provide coverage or pick up any claims made by the public.

Another consideration: If a protester is injured on anotherperson’s property, would the park owner be liable for that aswell?

And if the occupiers are injured but are there voluntarily, canthey be held responsible for their own actions, or would they beable to follow the letter of the law and sue the property’sowner?

“Usually the intention of general liability is to coveraccidental things that policyholders are responsible for,”Seidenberg says. “And you have to prove some level of negligence aswell. But if this is something that can’t be anticipated, then youcan’t really establish negligent or sudden and accidental.”

If sued, would the park owner in turn be able to sue thecity?

“I definitely think there is going to be subrogation potential,and they will pursue subrogation to recoup costs—not just forlawsuits, but to maintain the park, and after they leave, to cleanit up,” she says, noting that the OWS site has become a tent citythat boasts a medical tent, media tent and food tent, amongothers.

She adds that some local residents are also having trouble.“I’ve heard of cases where the protesters have damaged personalproperty. I also understand there have been confrontations [betweenprotesters and local residents],” she says.

Public workers also are at risk. “The police who are there arebeing subjected to [conflicts] day after day. Their public healthand safety is in question,” she says.

“I think you’ll start to see lawsuits coming from the peopleoccupying Wall Street as well, and at what point do you determineliability?” she asks. “Is it something they caused themselves, orwas there an expectation that the police would protect them fromcertain [risks]?”