Las Vegas - the risk management nightmare

It is ironic that there was an insurance industry conference held in Las Vegas this past week, one that began less than a day after the horror that occurred down the street from where we gathered.

The undercurrent of conversation throughout our event was the senseless, tragic murder and injury of so many innocent people. The streets in town were full of stories from hotel workers, taxi drivers and people we met who were there, or had a friend shot, or would have gone to the concert but for some last-minute reason. It was a somber occasion, reminding me too much of 9/11.

The staggering toll of this loss will no doubt be met with an equally staggering payout from a mountain of claims and lawsuits already underway. Analysts have downgraded MGM Resorts, owner of Mandalay Bay, which has shed 4% of its market value since the shooting. Medical costs alone are estimated at $600 million. The rest of Las Vegas seems to be holding its collective breath as it waits to learn the severity and duration of what is anticipated to be a slowdown in tourism.

So, what now?

How do you begin to control risk against this kind of nightmare? To what level of surrender of personal freedom must we as a society descend, and at what economic cost, to protect against such insanity? Many believe it may not be possible.

Any risk management efforts to mitigate against a recurrence of this episode are complex, costly and burdensome on the town that strives for openness and seeks to perpetuate its well-honed ask-no-questions attitude toward visitors. (You know - "what goes on in Vegas…") To push too intrusively against this brand could mar the welcome mat in lasting ways.

Yet something must be done. Something demonstrable will be done. At our conference we learned how technology is refining risk management in ways previously not possible. Big Data, for better or worse, knows a lot about us – our preferences, our behaviors and more than we may want to reveal. Artificial intelligence can analyze this information into predictions with reasonable accuracy.

In this sense, it could be argued that understanding the motive of the shooter might have helped. But history is replete with unnoticed people with a grudge and a gun. No actuarial table can calculate this risk and no amount of planning can anticipate everything. We are left with little in the way of answers. Low-level anxiety is the new social norm.

Foretelling will become the elusive technology goal for this kind of situation. But striking a balance between public safety and personal privacy will be the tricky part. Think TSA - we adapt and accept, albeit with resignation to a coarser world.

Meanwhile, more perfunctory efforts will be undertaken, such as that by Wynn Resorts, which reportedly has installed metal detectors and is now conducting bag searches at building entrances.

All this passes through my mind as we drive to the airport, heading home to a quieter place. The broken windows on the 32nd floor are clearly visible. It is eerie to look at, yet I am transfixed. I notice someone has finally pulled the curtains back inside. If only we could as easily turn back the clock...