Taking care of business

Don't underestimate the importance of a well-thought-out disaster plan

By Nancy Doucette

Keith Oufnac, MBA, CISSP, describes himself as “the epitome of the anal-retentive network administrator.” A certified information systems security professional, Oufnac has been with Eustis Insurance & Benefits for about eight years in the role of information technology director.

He believes strongly that the agency’s data is the lifeblood of the enterprise. That belief, and his attention to detail, have served the Eustis organization well. Responsible for the technology needs of some 120 employees and locations in New Orleans, Baton Rouge and Mandeville, Louisiana, and Houston, Texas, Oufnac quips that he takes care of “anybody who gets electricity” in the Eustis operation. He’s been a busy guy—very busy in fact, since the agency staff has quadrupled since he came on board. Mix in a few disasters with the growth and you understand just how busy he’s been.

Hurricane Katrina devastated the Eustis New Orleans location in late August 2005. Hurricane Gustav blew across Louisiana in early September 2008, giving the agency an opportunity to test some revisions that had been made to its disaster plan following Katrina. Less than two weeks later, Hurricane Ike, said to be the third most destructive hurricane to make landfall in the United States, hammered the Houston office.

With that breadth of experience, Oufnac shared some “lessons learned” during a standing room-only session at the 2008 Applied Systems Client Network TENCon.

The primary lesson learned was the importance of having formal agreements with the right resources. At the top of the list of resources for Eustis was Agility Recovery Solutions™. (For more information about Agility, see “Survive and Thrive,” in the June 2006 issue of Rough Notes.) With the tag line, “Business as usual. No matter what,” Agility delivers power, technical, and connectivity resources as well as temporary mobile locations to organizations whose operations have been disrupted.

Agility’s understanding of how urgent it is for insurance agencies to get back on their feet following a business disruption is reflected by its pledge: “We protect your promise.”

Eustis’ contract with Agility had been in effect for just two months when Katrina hit, Oufnac recalls. According to the plan, which he and Agility had laid out, a doublewide trailer equipped with 48 workstations was set up behind the agency’s Baton Rouge location. “We were in that trailer like a bunch of sardines, but we had a place to work,” he remembers.

Following Katrina, Oufnac says the agency set up a contract with an oil and gas distributor that happens to be a client. That assures Eustis availability of fuel for the generators that Agility provides.

Another post-Katrina decision was to formalize a plan with the local radio station—the only station still operational after the storm. The agency had been running regular radio spots that focused on the “Eustis Advantage,” Oufnac explains.

However, after Katrina, he says the agency realized it needed to get its name out in a different way before, during and after a disaster. There is now a series of four spots that are played as circumstances change, Oufnac points out. If there is a hurricane watch, the “time to get prepared” message runs. If conditions worsen, the content of the message expresses more urgency as well. And if there is another storm like Katrina, Eustis will run ads at the top and bottom of the hour, informing clients of agency contact information, claim handling procedures and safety tips.

Having an agreement with a dependable outside consultant should be part of any agency’s disaster plan, Oufnac notes. “That person needs to be your best friend,” he says with a smile. “Even if an agency does its own IT, it is a lot of work after a disaster to get everything back up and running. And if your IT person is incapacitated, there has to be somebody else who can step in. If your in-house person is not available, who’s next in line? That needs to be part of a disaster recovery plan as well,” he states.

Of course, there are a lot of agencies where the person in charge of the technology is a principal, a bookkeeper or a CSR as well. “That person probably isn’t going to be able to pull everything together as quickly as necessary following a major disaster, given their other responsibilities,” Oufnac offers. “You need to have an ‘on-call’ relationship with an outside consultant for those instances.”

“Crash bags” and “black boxes” are also integral following any kind of disaster. Oufnac explains that he keeps a backpack in his office to grab whether there’s a fire or a hurricane. He says this “crash bag” includes CDs of the agency’s Windows operating system; the latest version of TAM, the agency’s management system; a backup that is no more than a week old; copies of the licenses for Microsoft Office; a network switch and some network cables—“just in case we get somewhere where there are computers, but no way to group them together,” he says.

He recommends a personal crash bag as well—in case an individual has to quickly evacuate their home. It should contain birth certificates, insurance policies, prescription information, for instance.

Eustis provides “black boxes” to the members of the agency catastrophe committee as well as the producers. Oufnac says the “basic” producer black box contains a hard copy and a CD of their customer list. It also includes a copy of the catastrophe plan, a “catastrophe phone,” pens and paper. From there he recommends that producers stock their black box with whatever they will need to service their clients for about a week.

The catastrophe phone is a cell phone that has an Atlanta, Georgia, area code—well away from any of the Eustis locations. Oufnac acknowledges that there is an expense associated with maintaining these phones but, “when there’s no cell signal in your area, it gets a lot more expensive to not be able to talk to the people you need to talk to.”

The black boxes available to members of the catastrophe committee are a bit different in that they include a complete customer list, ACORD loss forms, a car charger and a home charger, in addition to the “basics” that are part of the producer black box.

Eustis also maintains a toll-free conference line. In the event of a catastrophe, the management team dials in at a pre-determined time.

The entire staff receives a laminated wallet-size card each year that provides all the Eustis contact information, as well as the 24-hour answering service, the numbers for all the remote offices and a Yahoo! e-mail address. It instructs people to work their way down the list until they are able to make contact. “This is especially important if someone needs to relocate outside our area,” Oufnac says.

“For any agency, disaster prepara-tion is essential and communication is key,” he emphasizes.

First back in business

“It’s all about ‘being there’ when your client needs you the most,” declares Roy Riley, CPCU, AAI, president of Peel & Holland Financial Group, based in Benton, Kentucky. “That’s why we focus the time, attention and dollars on disaster recovery so that when and if ‘it’ ever happens, we’re able to help clients.”

“It” did happen in late January 2009 when an ice storm knocked out power from Oklahoma to West Virginia. All four of Peel & Holland’s locations were without power. For that matter, Riley reports, 95% of western Kentucky was without power. Cell phone signals and landline accessibility were spotty.

About three years ago, Riley attended a meeting of Sitkins International where he learned about Agility Recovery Solutions. “We came home from that meeting and immediately signed up,” he recalls. That turned out to be a wise decision.

As the ice storm headed toward Kentucky, Riley alerted Agility and switched the phones for all the agency’s locations over to CSR24. After the storm had passed he assessed the agency’s needs. All that was needed was a generator so he contacted Agility again and they delivered a 100-kilowatt generator in about nine hours. “That provided us lights, heat and enough electrical power to run the entire building,” Riley says.

Because the agency didn’t lose its Internet connectivity, Peel & Holland was able to open up four IP lines, restoring phone service. The agency obtained smaller generators on its own for its other locations. “We were probably the only organization in western Kentucky that had power, phones and Internet connectivity,” he adds.

The local television station for Benton was running an extensive list of closings. Only two businesses announced that they were open the day after the ice storm. Peel & Holland was one of them.

Seeing that the agency was open was reassuring for clients, Riley notes, particularly since people were unable to buy gas or groceries in the days right after the storm. Individuals and business owners insured through other agencies were coming to Peel & Holland for policy analysis and to file claims. “I predict they will be our clients in the future,” he smiles.

Five days after the storm, power was restored to most of the region and businesses started reopening. “By then, Peel & Holland had already reported over 250 claims on behalf of our clients,” Riley says proudly. “Additionally, we had made over 700 proactive outbound calls to our clients. Two of our carriers already had their storm teams in place and were meeting with clients. On the day that most of our competitors were just opening for business, we had been fully functional for four-and-a-half days and had things well underway.”

Disaster planning and recovery is a regular discussion point with clients, Riley points out. “In discussing disaster recovery with our clients, we explain that there are certain risks that just aren’t insurable. Disaster recovery is one of those areas where part of it is insurable and part of it isn’t.

“When we have the disaster recovery conversation with our clients, we determine whether Agility would be helpful to them,” he continues. “If so, we put them in touch with Agility and let them run with it from there. Agility can provide some great statistics about the failure rate of businesses that aren’t able to get back in business quickly.”

The Kentucky League of Cities (KLC) is one client that Peel & Holland put in touch with Agility. The KLC is an association of 400 Kentucky cities and munici-palities. Riley explains that the KLC has a self-insured program through which it provides property, liability and workers comp to most cities in Kentucky.

“We saw that Agility was a key opportunity for the Kentucky League of Cities,” he continues. “So we recommended to the KLC that they include Agility in their insurance program. Having Agility was a key tool which enabled the cities to recover quickly from this disaster.”

Twenty-one cities and municipalities in western Kentucky declared emergencies with Agility following this year’s ice storm. Thanks to onsite generators, these communities were able to power city halls, civic centers, 911 command centers, community shelters, and water plants.

Community spirit

After Hurricane Katrina struck the Gulf Coast in 2005, Alan Hedrick, CIC, owner of County Wide Insurance Agency, based in Dexter, Missouri, traveled to Bay Saint Louis, Mississippi, to assist a fellow agent he knew from his activities on the Agents Council for Technology. “When I saw the devastation, I realized I needed a better disaster recovery plan,” he recalls. Coincidentally, Dexter and Bay Saint Louis both have about the same population: 8,000.

By June 2008, Hedrick was putting the finishing touches on the disaster plan for his agency that has 22 employees and four locations in southeast Missouri—a region of the state known as the Bootheel. The agency’s servers were housed in a data center located in Atlanta, Georgia. Additionally, the agency was using CSR24 and Hedrick had signed on with Agility Recovery Solutions after hearing about it at a Sitkins International meeting.

When the January 2009 ice storm turned the Bootheel into a disaster area, County Wide was one of the only businesses in Dexter to have power—aside from emergency shelters and water pumping stations—thanks to Agility delivering a 125-kilowatt generator in a matter of hours.

But when you’re part of a tight-knit community, you share your resources with your neighbors, Hedrick notes. So when Mark Stidham, the city administrator for Dexter, contacted County Wide to see if they could house about 40 individuals with special health considerations, Hedrick and his business associate, Jason Comfort, put the wheels in motion. Unlike the old high school gym that was being used as a shelter, County Wide had refrigeration readily available for insulin, other medications and special dietary needs.

“Our Dexter location is a converted bank building,” Hedrick explains, “so we have plenty of lobby space. We set up cots in the lobby and hallways. Elderly folks as well as young families were here.”

Hedrick also invited his carriers to the office if they needed to connect to the Internet. “We wanted to help those carriers help our clients,” he offers. “So we opened our board room and invited them to stop by to process their claims. Some did come in to submit their claims.”

County Wide processed about 120 claims related to the ice storm. Ninety of those claims were processed on the two days immediately after the storm, something that Hedrick is proud of.

As for the disaster plan, Hedrick acknowledges, “There are things that you take for granted when you put a disaster plan in place, so we have learned some things that we should improve upon. We need to consider the ‘what-ifs’ in more detail. We need to have a printout of essential phone numbers. We need to assign tasks to specific individuals. We need to create a disaster recovery manual and give it to everybody on staff to keep at their home.

“We have a business relationship with Stafford & Stafford Insurance, an agency located just south of Kansas City, Missouri—about six hours away,” he continues. “We’re going to provide them a copy of our disaster recovery plan as well. If they hear of a weather problem in our area and they are unsuccessful in contacting us, they will implement our disaster plan.

“Some things we didn’t have planned out,” Hedrick concludes. “But we had an aggressive spirit to go get it done. We’re formalizing those things now. You have to consider the ‘what-ifs.’”

For more information:
Agility Recovery Solutions
Web site: www.agilityrecovery.com