8 Factors to Help Insurers Assess the Potential Exposure

Mass shootings are occurring with mind-numbing frequency and resulting in unspeakable tragedy, all while seemingly endemic to 21st century America. While the legal system, various legislative bodies, and society at large grapple with solving the disturbing mass shooting phenomenon, “main street” food, beverage, and entertainment business owners may find themselves questioning the potential impact of mass shootings, from both public safety and risk management perspectives.

Leaving aside the larger societal debate underway about gun regulation and ammunition restrictions, this piece offers some insight into those issues.

Mass Shooting Event Defined

The FBI defines a “mass shooting” as any incident in which at least four people have been murdered with a gun.¹ The year 2023 has seen a record high number of mass shooting incidents and victims when compared to past years.²

Number of Mass Shooting Incidents and Victims Killed (2006‑2013 TYD)

Based on the data, looking at it by quarter, much of the mass shootings happen in the second half of the year. The moving average trend line doesn’t look good for the rest of 2023.

Incidents by Quarter (2006‑2013 TYD)

The trend line portends for 2023 to be an exceptionally tragic year, especially given that the bulk of mass shooting events historically occur during the second half of any given year. Further, data indicates that mass killings (including those that don’t involve guns) are not confined to big cities.³

Mass Killings by Location Scaled by # Victims

Mass shootings are comparatively recent in American history. On August 1, 1966, 25‑year-old Marine veteran Charles Whitman ascended the top of the University of Texas (Austin) clock tower and embarked on shooting spree in which 15 people were killed and at least 33 were injured.⁴ The event marked the first mass shooting in modern American history and stood alone for many years as the deadliest.⁵ Shattering that dubious distinction was the July 1984 McDonald’s shooting in San Ysidro, California, in which a lone gunman armed with a semi-automatic pistol, a semi-automatic rifle, and a shotgun killed 21 restaurant patrons, some of whom were less than 12 years of age.⁶ More recent occurrences have supplanted both events in our collective memory, among them the horrific April 1999 Columbine High School (Littleton, Colorado) shooting that left 13 dead, 12 of whom were students.⁷

Since 1966, there have been 190 public mass shooting incidents that have taken 1,364 lives.⁸ Most of these events have taken place since 2000, with heightened frequency since 2010.⁹ Moreover, these events have become more lethal in recent years.

The venues above correspond with historical data. Of the 190 recorded mass shooting incidents 38 have occurred at retail establishments, 27 at restaurants/bars, and 25 at factories/warehouses, with these three categories collectively representing the most frequent locations of mass shootings in recent years.¹⁰ Further, for those incidents that took place at retail establishments and restaurant/bars, the vast majority involved “outsiders” or someone without an existing connection to the shooting site.¹¹

Common Themes

Although the specific motivations of mass shooters vary, researchers point to handful of attributes the shooters have in common. Nearly all are male, and their actions can be precipitated by traumatic events such as the end of a relationship or the loss of a job.¹² Moreover, mass shootings tend not to be spontaneous, but rather the product of extensive planning that can encompass days, weeks, or months.¹³ Additional characteristics include a history of mental health issues and displays of warning signs such as hateful ideology on social media.¹⁴ Other researchers, such as professor and commentator Scott Galloway, suggest that online activity and social isolation also play a role in that the web provides unfettered access to like-minded thinking, without the protective “societal guardrails” provided by face-to-face interaction and romantic relationships.¹⁵

As to frequency, a recent study posits that mass shooting events usually occur in clusters and tend to be contagious, with intense media coverage driving the contagion.¹⁶

The End of Foreseeability?

Many have argued that mass shooting events remain random and isolated when viewed in the context of the overall crime – and specifically violent gun-related crime – that occurs annually in the U.S. While this sentiment may have some validity, there remains an inescapable fact: These events are no longer unforeseeable. At least one mass killing has occurred in each state but Hawaii. Further, that these events are both random and occurring with greater frequency should give retail, restaurant, and hospitality businesses reasons for concern since they can happen anywhere at any time. And if that is the case, what can be done? Could a jury in a lawsuit brought by victims hold a business owner responsible for being ill-prepared to address a mass shooting event, such as not having protocols in place to protect patrons and diminish the chance of such an event occurring, or to minimize its impact if it does?

Risk Treatment

Our industry would do well to lean into these questions, as we have led on public safety in other areas. Whether it is risk management on liability issues or safety procedures for property care, we are able to have an influence on mitigating the impact of tragic events.

When it comes to commercial insurance underwriting for shooter risk, it’s crucial to consider various factors to assess the potential exposure. Here are some guidelines to consider:

1. Evaluate Security Measures – Assess the insured's security protocols, including access control systems, surveillance cameras, alarm systems, and employee training programs. Strong security measures can significantly reduce the risk of a shooting incident.
2. Analyze Location – Consider the location of the insured's premises and any surrounding factors that may influence the risk. This could include crime rates in the area, proximity to law enforcement, and any history of violence or threats nearby.
3. Assess Risk Management Procedures – Look for comprehensive risk management strategies in place, such as emergency response plans, crisis communication protocols, and active shooter training programs for employees. Well-prepared businesses can mitigate the impact of a shooting event.
4. Consider Employee Background Check Processes – Inquire about the insured's employee screening processes. Thorough background checks can help identify potential risks and minimize the chance of an internal threat.
5. Evaluate Industry-Specific Considerations – Different industries may have unique risk profiles. For example, businesses that deal with high-value assets or public gatherings may require additional security measures or specialized coverage.
6. Collaborate With Experts – Engage with risk consultants or security professionals who specialize in assessing shooter risk. Their expertise can provide valuable insights and help make informed underwriting decisions.
7. Stay Updated – Regularly monitor evolving trends, industry best practices, and emerging technologies related to shooter risk prevention and response. This knowledge can help enhance your underwriting process.
8. Review History – As always, consider account history from an experience and operational upgrade perspective.

Coverage Environment

Each company should assess their risk appetite and vulnerability based on all the factors normally considered on emerging exposures. So far, we are seeing some use of exclusionary wording, at a minimum for certain classes of business. There are some specialty markets offering limited coverages. We expect the coverage arena to continue to evolve and for policy wording to be further formalized as our industry grapples with new realities.

While the larger societal debate around gun regulation and ammunition restrictions continues, our desire is to start a conversation about the potential impact of mass shootings from both a public safety and risk management perspective. These tragic events continue to plague communities across the country and best practices continue to evolve. If you want to join the conversation, please feel free to reach out to us or your Gen Re Account Executive.