On lo­cal soil

RISKSA Magazine - - Contents -

It is an or­deal for a com­pany, but if the com­pany and its em­ploy­ees have a solid and well-ex­er­cised cri­sis com­mu­ni­ca­tion plan that is reg­u­larly up­dated, it can emerge with its rep­u­ta­tion in­tact, says Birns. The tra­jec­tory of public and in­vestor opin­ion is of­ten re­flected in the air­line’s share price fol­low­ing an ac­ci­dent – if it’s a listed com­pany of course. “You’ll see a dip in the share price im­me­di­ately fol­low­ing news of an ac­ci­dent and depend­ing on how they han­dle it, you’ll see the per­ceived value of the share price of the com­pany fluc­tu­ate,” he says. “The share price is all about per­cep­tion.” Birns says he’s not aware of any ex­ist­ing in­sur­ance poli­cies that would cover po­ten­tial busi­ness loss re­sult­ing from an air­line ac­ci­dent. “Com­pa­nies are, how­ever, able to get dis­counted in­sur­ance if they pass the In­ter­na­tional Avi­a­tion Safety As­sess­ments (IASA) safety au­dit.” One of the pre­req­ui­sites of the bi-yearly au­dit is that an air­line has a com­pre­hen­sive emer­gency plan in place in­clud­ing a cri­sis com­mu­ni­ca­tion plan; a plan Lufthansa seems to firmly have in place. A quick pe­rusal of their site shows al­most bi-daily press re­leases and up­dates al­most ev­ery cou­ple of days. The air­line of­fers flights and trans­port to and from Mar­seille near the crash site for next of kin of the de­ceased to pay their re­spects, and Thomas Winkel­mann, Ger­man­wings CEO, shares his con­do­lences in a video on the site. Re­gard­ing re­me­dial mea­sures, Birns says that con­sid­er­able po­lit­i­cal pres­sure is of­ten ap­plied to an air­line in the event of a sen­si­tive ac­ci­dent of this na­ture, as was ev­i­dent with the in­tro­duc­tion of the ar­moured doors in the cock­pit that im­me­di­ately fol­lowed 9/11. “Nei­ther the man­u­fac­turer, air­line nor pi­lot wanted the doors to be in­stalled as it was go­ing to cre­ate more prob­lems than so­lu­tions, but the po­lit­i­cal opin­ion at the time was that the cock­pit needs to be for­ti­fied to keep the bad guys out,” says Birns. The ‘ bad guys’ should, how­ever, be stopped at air­port se­cu­rity, he says. “When they’re on the plane it’s too late.” Co­mair, who op­er­ates un­der low-cost air­line, Ku­l­ula, as well as Bri­tish Air­ways, is in dis­cus­sion with the South African Civil Avi­a­tion Author­ity (SACAA) and other reg­u­la­tors about pos­si­ble changes to safety pro­ce­dures at the air­line fol­low­ing the Ger­man­wings in­ci­dent. In the in­terim, the air­line has in­tro­duced pre­lim­i­nary safety pre­cau­tions. “Pi­lots will min­imise their re­quire­ment to leave the flight deck as far as pos­si­ble. If a cock­pit crewmem­ber does in­deed re­quire leav­ing the cock­pit, a cabin at­ten­dant will move into the cock­pit for the du­ra­tion of the cock­pit crewmem­ber’s ab­sence,” a state­ment from the air­line says. Co­mair’s op­er­a­tions direc­tor, cap­tain Martin Lowe, says pi­lots that fly with Co­mair re­ceive ad­e­quate train­ing and rest as well as un­dergo ex­ten­sive psy­cho­me­t­ric as­sess­ments be­fore they are em­ployed. “Our pi­lots are trained to recog­nise and deal with ab­nor­mal be­hav­iour on the flight deck and are en­cour­aged to re­port ab­nor­mal be­hav­iour im­me­di­ately,” he says. “Pi­lots are mon­i­tored by their fleet man­age­ment team to en­sure men­tal fit­ness as far as pos­si­ble.” The com­pany also has a pro­gramme in place to sup­port pi­lots in man­ag­ing their emo­tional well­be­ing. “In part­ner­ship with the In­de­pen­dent Coun­selling and Ad­vi­sory Ser­vices (ICAS) which pro­vides a 24 hour a day, 365 days a year per­sonal sup­port, the com­pany in­vests in an em­ployee-well­be­ing pro­gramme to en­sure its pi­lots, as well as its other em­ploy­ees, have ac­cess to the as­sis­tance and sup­port they might need in man­ag­ing their over­all well-be­ing, in­clud­ing their psy­cho­log­i­cal and emo­tional well­be­ing,” says Lowe.

Look­ing for­ward

In its 2014 re­port, Al­lianz says that even though ex­po­sure or po­ten­tial loss has in­creased by more than 50 per cent since 2000 due to an in­crease in flights, the im­proved safety en­vi­ron­ment is re­flected in the pre­mi­ums for avi­a­tion in­sur­ance, which were at their low­est prior to the in­crease in air­plane losses in 2014. “Ex­po­sure’s in­creased from $576 bil­lion in 2000 to $896 bil­lion. This means that if ex­po­sure growth con­tin­ues at the same rate, we can ex­pect it to break through the $1 tril­lion bar­rier within the next five years and pos­si­bly even ear­lier,” the in­surer says. God­den at San­lam Avi­a­tion says the most re­cent crash will prob­a­bly not have a mas­sive im­pact on in­sur­ance pre­mi­ums in the avi­a­tion mar­ket. “De­spite some big claims of late there is still a great deal of in­sur­ance ca­pac­ity avail­able,” he says. Rin­t­jes agrees and doesn’t fore­see any im­pact on un­der­writ­ing in the avi­a­tion in­dus­try. In the mean­time, the safest and quick­est way of trav­el­ling re­mains thou­sands of feet off the ground in a metal cap­sule hurtling along at hun­dreds of kilo­me­tres per hour. How­ever un­safe that sounds, the odds of dy­ing while rid­ing a bi­cy­cle are 100 times greater than fly­ing, odds that any bet­ting man would back, es­pe­cially if his life de­pended on it.

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