About Morgan O'Rourke

Morgan O’Rourke is editor in chief of Risk Management magazine and director of publications for the Risk & Insurance Management Society (RIMS).
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The 15 Most Bizarre Insurance Policies Ever Written

When I was a kid, I remember being fascinated by stories that some celebrity or another had insured some body part for millions of dollars. The go-to legend I remember the most from my 80s youth involved Tina Turner’s legs (which is true — it turns out they’re insured for $3.2 million). The folks over at Business Insider evidently have similar interests and have published their list of the 15 most bizarre insurance policies ever written.

Here’s some of the celebrity highlights:

Heidi Klum’s legs: $2.2 million
Klum has both legs insured, but one happens to be worth more than the other: “The Victoria’s Secret strutter’s right gam is insured for $1.2 million, but her left is worth only $1 million. Why the discrepancy? A little scar on her left limb.”

Tom Jones’ chest hair: $7 million
Believe it or not, Jones used to be considered a sex symbol, so to keep his sexiness in tact, he’s insured that mane of hair on his chest for a princely sum: “Tom Jones, still making elderly Las Vegas audiences swoon at age 67, lives in fear. Sure, he’s stayed famous for like half a century, and probably sexed enough women to populate a small and very satisfied country.

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But Tom believes all that could come crashing down with a single accident (say, a spontaneous shirt combustion) that in any way damages his luxuriant pelt of chest hair.

Keith Richards‘ middle finger: $1.6 million
The Rolling Stones’ Keith Richards has already said “f#$% you” to the world on multiple occasions, but just in case he can’t get one last flip of the bird in before he dies, Richards has insured his middle finger for $1.6 million.

And don’t forget the just plain odd:

Alien abduction, impregnation and consumption: $1.5 million
There are actually over 20,000 people in the US alone who pay a premium for insurance against alien abduction.

Taco Bell’s space station promotional bullseye insurance policy
During a promotion for a piece of the MIR Spacestation, Taco Bell said that if during re-entry the flying object hit a floating target the company had set up, everyone in the US would get a free taco. God forbid it actually happened: Taco Bell hedged with an insurance policy to avoid going completely bankrupt.

You’ve got to figure this is a pretty safe policy for an insurer to write.

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After all there’s not much room for fraud. After all, it’s not like Tina Turner is going to burn down her legs for the insurance money. Right?

Tom Jones wants you to gaze upon $7 million worth of chest hair.

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Runaway Toyota a Hoax?

On March 8, San Diego-resident Jim Sikes was driving his 2008 Toyota Prius on a Southern California freeway when he claimed it began to speed out of control. According to Sikes, his attempts to slow the car failed and after reaching speeds in excess of 90 mph, he was only able to stop the runaway car with the assistance of a highway patrolman.

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At first glance, the incident seemed like yet another symptom of Toyota’s unintended acceleration woes that have led to the recall of millions of vehicles since late last year (and will be covered in more depth in our upcoming April issue).

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But when a subsequent examination of the vehicle by Toyota and federal government investigators failed to duplicate the problem, it called the accuracy of Sikes’ account into question. Toyota found the car’s gas, brake, and safety override to be in working order and that Sikes had rapidly pressed the gas and brake pedals back and forth 250 times (the maximum amount of data that the diagnostic system could collect). This may have caused the brakes to overheat and since Sikes did not press the brakes hard enough, the brake override system did not engage.

Fox News reported that Sikes has had a history of financial problems, which has led some to suggest that his report may have been a hoax. Toyota spokesperson Mike Michels would not say outright that Sikes had fabricated his story, however.

“We have no opinion on his account, what he’s been saying, other than the scenario is not consistent with the technical findings.”

Toyota’s investigation of the Sikes incident seems to indicate a shift in their response to the acceleration issue from one of contrition to a more aggressive defense of the safety of the vehicles. As they continue to investigate the source of the problem (could it be cosmic rays?), it is apparent that they are now willing to fight for their brand. Hopefully for their business and, more importantly, for Toyota drivers, their rediscovered focus is not a case of too little, too late.

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Improving Your Policy Wording

In an exclusive, online-only column, Robert Horkovich and Marshall Gilinsky of Anderson Kill & Olick talk about how a soft market is the perfect time to improve your insurance policies.

Changes to policy wording are most likely to be accepted during soft markets like the one that has existed over the past several years. Although in theory, underwriters price policies based on the specific risks being transferred via the actual policy, in practice, due to competition from other insurance companies, lack of effort or both, it is usually the case that requested changes to policy wording usually do not result in corresponding changes to premium. Essentially, the underwriter agrees to “throw in” the broadened coverage in order to keep the policyholder’s business.

For more about how to go about revising your policy in your favor, click here to read the full article on RMMagazine.com.

Safe Travels

The airline industry gets a lot of bad press, what with the occasional terrorist threat, security hassles and new fees for blankets and the like, but they deserve to get credit for when they’re doing things right. According to the International Air Transport Association (IATA), an airline industry trade group, 2009 was the second safest year for Western-built jets since the group started keeping records in 1964.

The IATA reported a rate of only one accident per 1.4 million flights, meaning that statistically you could take a flight every single day and not get into an accident for 3,859 years. Only 2006 saw a safer year and since 2000 the accident rate has dropped 36%.

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“Safety is the industry’s number one priority. Even in a decade during which airlines lost an average of US$5 billion per year, we still managed to improve our safety record. Last year, 2.3 billion people flew safely. But every fatality is a human tragedy that reminds us of the ultimate goal of zero accidents and zero fatalities,” said Giovanni Bisignani, IATA’s Director General and CEO.

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There is still room for improvement in certain key areas, however. Pilot handling was a contributing factor in 30% of all accidents, while runway incidents (called “excursions” by the industry) and ground damage accounted for 26% and 10% of all accidents respectively in 2009. The IATA has proposed a variety of safety programs to address these and other risk factors.

“Safety is a constant challenge. Having made aviation the safest way to travel, further improvements will come only with careful data analysis. We must understand the underlying safety risk trends, not just from the handful of accidents each year, but by bringing together and analyzing data from millions of safe flights.

The IATA Global Safety Information Center was launched in December 2009 for just that purpose.

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Going forward our goal is to work with other organizations and governments involved in aviation safety to add to the database and drive even more improvements,” said Bisignani.

Now if they could just do something about flight delays.