One of the occupational hazards of being a journalist who happensto cover the insurance industry is you start becoming a riskmanager yourself. You spot hazards no one else pays attention to.You see exposures lurking everywhere. And you instinctively takesteps to limit any risks you identify, as well as make sure youhave the proper loss control and coverage programs in place shouldthe worst-case scenario occur. Today, I share with you a recentcolumn by Senior Editor Caroline McDonald, who notes how thelessons she's learned writing about risk management helped save herproperty on a dark and stormy night.

RM Lessons Hit Home

BY CAROLINE MCDONALD

It was a dark and stormy night. That may be a hackneyed oldjoke, but its a perfect description of the night a major storm hitour home and I had to put the lessons I learned from covering riskmanagement to the test.

We live in a tree-filled suburb north of New York City. Theforecast was for severe thunderstormswith tornado warnings. At 4:00p.m., my husband called to tell me a ferocious storm had hit, withvery high winds, and the area was littered with fallen trees. Oh,and our electricity was off.

OUR ELECTRICITY WAS OFF!?!

To most, thats an extreme inconvenienceto us its a nightmare,since we have two sump pumps in the basement. The last time theelectricity went out, six inches of water accumulated before wecould find a plumber. That flood meant a lot of boxes full ofvarious small appliances, pictures, bedding, clothing, books,records (remember vinyl records?) and other personal items had tobe thrown out. And it meant submitting a claim to our insurer.

This is where risk management lesson number one came in: Developa long-term plan to prevent another flood. First, we purchased agenerator as a back-up, to keep both sump pumps running in case ofa power outage. Next, we had three medium-size trees removed fromthe backyardwith shallow root systems and overhanging limbs thatcould damage the roof.

Another upgrade occurred by accident after a recent three-dayrain. The constant amount of water being pumped caused thesump-pumps to shut down. Here was risk management lesson numbertwo: Even when you think you have thought of everything, somethingelse can go wrong. Luckily, we found a plumber in time, had verylittle water in the basement and a solid new pump.

So, with a contingency plan in place covering both wind andwater, I was about to learn lesson number three. Now the power wasout, and like many risk managers, I had a plan in placebut anuntested plan. The generator had never been started. Would it startat all? Would we be able to hold off rising waters until the powerwas back? Stay tuned.

I hurried home, praying the generator would start. While enroute, my husband called to say he had the generator going and hadthe pump plugged into it! When I got home, I plugged therefrigerator into it as well. What a relief! We were safethis time.I lit some candlestime to celebrate with a good game ofScrabble!

But I kept thinking about all the things risk managers ofbusinesses and municipalities have to consider on a daily basis,projecting anything that could possibly go wrong. I also thoughtabout the experts Ive spoken to, who caution about the importanceof testing a contingency plan before an event occurswhere riskmanagers most often fall short.

Here brokers can play a key role. They possess much knowledgeabout how contingency plans can best be tested and what can gowrong. Agents, likewise, are in a position to help their homeownerclients minimize damageand reduce claims.

The dry run for our contingency plans was a real storm, butfortunately, everything worked out. And now for lesson number four:Get that Scrabble game finished before the lights come back on.Unfortunately, I missed my chance. All of a sudden the power was onand favorite TV shows took precedence (and I was ahead!).

NU Senior Editor Caroline McDonald invites readers to sharetheir war stories by either posting her on Sam's blog, or bye-mailing [email protected].