eye of a hurricane

U.S. Virgin Islands One Year After The Hurricanes: Lessons In Disaster Preparedness And Recovery

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The U.S. East Coast is currently preparing for the arrival of Hurricane Florence, forecast to make landfall in the Carolinas with windspeeds of at least a hundred miles per hour. Beyond wind impacts, Florence could pose a major threat of coastal storm surge and inland flooding. In areas most at risk, millions of people have been advised to evacuate and companies have initiated preparation plans.

Hurricane Florence is already bringing back memories of 2017, one of the most damaging hurricane seasons on record. Many of the cities and territories hit by Hurricanes Irma, Maria, and Harvey are still recovering – with some further along than others. In Puerto Rico, for example, at the start of this year’s hurricane season, 10,200 people were still without power. And Houston, the fourth most populous city in the U.S., and largest in Texas, released a $1.5 billion housing plan close to 10 months after Hurricane Harvey made landfall.

In contrast, though the damage to the U.S. Virgin Islands (USVI) caused by both Hurricanes Irma and Maria was extensive, the USVI made accelerated progress toward recovery. According to Curtis Lee and Brian Valery of Alpha Risk Management, who lead risk management efforts for the Virgin Islands Port Authority (VIPA), the facilities on all three Islands were able to get back up and running due to advanced preparation, including emergency response plans, crisis management, accurate property valuations, a well-designed property insurance program, loss documentation, risk mitigation, and claims handling.

So what can businesses and governments learn one year on from one of the worst hurricane seasons ever recorded? And how can businesses and industries maintain continuity when faced with extreme natural disasters?

According to Jill Dalton, managing director, Property Claims Preparation, Advocacy & Valuation, Aon, “Businesses that do their due diligence prior to a major disaster happening tend to have the best outcomes, and a quicker recovery. Further, just because a major event hasn’t happened in a while, or just happened, doesn’t mean it won’t happen again soon.”

Takeaways from VIPA’s experience could help organizations better prepare for, and manage, such catastrophic events.


Located on USVI’s St. Thomas, St. John, and St. Croix, VIPA’s 119 facilities include everything from marinas and airport terminals to small rental facilities and retail stores. Since VIPA has a range of facilities spread across the three islands, a coordinated disaster planning and preparation effort, as well as implementing a claims management and recovery process, can pose a myriad of logistical challenges, says Lee. As such, VIPA needed to be proactive about planning its protection and crisis response efforts, he added.

Years before Hurricanes Irma and Maria made landfall, VIPA began working on protection and preparation efforts in the event of a natural disaster. These efforts included obtaining updated appraisals of all its properties and making dramatic manuscript enhancements and increases to its insurance coverage for windstorm, hurricane, and flood exposures.

On September 6, 2017, Hurricane Irma made landfall on St. Thomas and St. John, and 13 days later Hurricane Maria hit St. Croix. After the hurricanes struck USVI, VIPA’s claim team visited all of its 119 facilities – along with engineers representing VIPA’s insurers – and prepared damage assessment reports for each location. Without pre-storm appraisals, understanding the extent of the insu­red damage would have been much more difficult. Indeed, the pre-storm appraisals were critical in the effort to quantify the magnitude of insured damage.

Further, by completing these measures in a timely fashion, VIPA received $30 million in advance payments from its insurers. In addition to funding vital repairs, the advances helped VIPA maintain the confidence of the financial markets and its bondholders. During its recovery efforts, VIPA was not constrained in securing materials and manpower as the pre-funding put them in an enviable position with vendors and contractors who were concerned with the ability of affected entities to pay, according to Valery.

Preparing For Disaster

Drawing from its disaster recovery plan in the days before Hurricane Irma reached the islands, VIPA notified its property insurers of a substantial pending loss. It also implemented its disaster risk mitigation protocols, including measures to protect workers, secure physical assets, shield windows, and minimize potential damage from flying debris and put in place systems to track pre- and post-storm expenses.

In addition, VIPA had several initiatives in place to elevate its protection and preparedness:

  • Conduct comprehensive property and equipment appraisals. VIPA had third-party appraisals conducted in 2012 and 2014 for all of its facilities, which proved invaluable for documenting its insurance claims.
  • Strengthen the property insurance program. The organization had extensive coverage enhancements negotiated years in advance of the storms, in addition to increases in property insurance limits specific to windstorm, hurricane, and flood.
  • Establish business continuity and crisis management plans. VIPA and its risk management team developed, implemented and tested comprehensive crisis management and business continuity plans to address potential damages from hurricanes, floods, and other perils.
  • Participate in a global database system. All of VIPA’s facility locations were uploaded on to a global database that tracks hurricanes and other natural disasters and provides frequent updates of pending threats to properties.

The Journey To Recovery

These initiatives – in conjunction with emergency response, crisis management, mitigation, and claims handling – were keys to VIPA’s accelerated recovery from Hurricanes Irma and Maria.

Overcoming a communication breakdown. In the first 36 hours after Hurricane Irma made landfall on St. Thomas and St. John, communication between VIPA’s risk management and its operations on the islands was lost. Yet VIPA’s risk management team still began the first-notice-of-loss processes and prepared initial loss estimates based on governmental assessments and media coverage such as press conferences streamed live over the internet.  As communication was being restored, members of VIPA’s engineering and finance departments visited all of its facilities, refined the preliminary loss estimates using spreadsheets that listed the assets and their appraised valuations and took numerous photographs.

Meanwhile, VIPA retained external support to provide immediate remediation, including assessing airport damage and supplying vital temporary equipment to restore operations for emergency transportation of personnel, critical supplies, food, and water.

Key takeaways:

  • Establish comprehensive disaster management and recovery plans. Develop protocols for all measures needed during a major loss event to protect employees, customers, facilities, and equipment; mitigate loss post-event; and facilitate recovery. Rehearse and test the plan periodically and update it to address any changes in operations, exposures, and personnel.
  • Don’t overlook disaster communication. After experiencing 36 hours of communication downtime due to the hurricanes, VIPA invested in satellite phones and related internet capabilities to keep its emergency communication channels open.

Fast-tracking a complex claim. Within a month of the hurricanes making landfall on USVI, engineers representing VIPA’s insurers were escorted by VIPA personal to each of the authority’s facilities. Estimated repair, restoration and reconstruction costs ranged from a few thousand dollars at certain facilities to many millions for the airports and other properties, such as seaports.

Key takeaway:

  • A fast response can help accelerate recovery. The ability of VIPA’s engineers and financial teams to visit properties as quickly as possible, take photographs and conduct initial damage assessments was critical for VIPA to secure substantial advance payments from its insurers.

Determining causation. The earlier work by VIPA’s engineering and finance team of taking photographs and gathering loss data from Hurricane Irma proved invaluable when Maria hit the islands 13 days later. VIPA’s risk management and claims professionals used that information to assess the second hurricane’s impact.

“Companies that pay close attention to their schedule of values and ensure these values are clearly and accurately reported will typically experience a smoother and more effective claims management process. This time investment and attention to asset values on the front end can be extremely valuable,” says Peter Jagger, Managing Director and Senior Vice President, Global Risk Consulting, Aon.

Key takeaway:

  • Have up-to-date appraisals, documentation, and photographs of key assets. These materials were critical to VIPA’s insurance recovery.

Managing the adjustment process and recovery. After the condition of VIPA’s facilities was reviewed, the organization set priorities for the recovery and rebuilding of specific assets based on several criteria: their importance to USVI and its residents; their significance to VIPA and its income stream; and the impact and severity of damage. As a result, 15 assets, including the airport terminals and marine facilities, were designated top priorities.

This list was shared with all stakeholders, including insurance company adjusters so they could conduct inspections and determine the required repairs. These types of assessments can help adjusters recognize major recovery obstacles such as difficulties accessing sites, an unstable power grid, challenging transport logistics for rebuilding materials and a lack of accommodations for skilled workers.

Key takeaway:

  • Double-check adequacy of insurance coverage well in advance of any event. VIPA professionally evaluated its situation and increased its coverage for windstorm, hurricane, and flood years before the 2017 hurricane season.

Embracing new technologies and response strategies. Using new technologies can help organizations expedite loss documentation and claims reporting while also freeing up time for risk and emergency responders to focus on other aspects of recovery. Insurance carriers and risk consultants rely more and more on drones and satellites to quickly, accurately and safely assess damage and capture photos of loss. In addition, apps on mobile devices help property claims consultants quickly document facility and equipment damage, expediting the claim process.

Key takeaway:

  • Drone and satellite technology can speed up damage assessments following catastrophic events. Work with first responders and claim consultants who embrace new technologies that can be beneficial in a claim advocacy situation. For example, VIPA used app technology to help expedite claim documentation and reporting.

Improving Resilience Through Disaster Preparedness

When assessing risk and continuity plans, businesses and governments might view the worst-case scenario as merely an abstraction. However, as the 2017 hurricane season reinforced, unprecedented catastrophic events are becoming worryingly commonplace. VIPA’s experience demonstrates that the key to good disaster recovery lies in advanced planning, which can greatly mitigate the lasting impact of such events.