For risk managers at ski resorts, the risks abound—from the skies above to the trees, parking lots, chair lifts, skiers and snowboarders below. And in many cases, unfortunately, their ability to control these threats is limited.
Ultimately, the skiers and boarders, and the choices they make, have the biggest impact on safety, yet keeping participants healthy and regularly visiting resorts is critical to the industry’s financial health. Ensuring both is among the highest priorities of Dave Byrd, director of risk and regulatory affairs for the National Ski Areas Association (NSAA), which represents more than 300 ski resorts in the United States.
“In addition to our concern for their individual overall health and safety, it does us no good for a guest to buy a season pass on October 1 and get injured on November 2,” said Byrd. “We know, from a marketing perspective, that we make much more money on returning guests, so to have our guests get injured really does not do us any favors in the broader revenue generation outlook.”
As such, ski resorts deal with a large degree of liability risk from personal injury. It is a risk that shows up “every place they look, from the parking lot to the chair lift to the trails to the events that they have,” said Dave Belin, director of consulting services for RRC Associates, a Boulder, Colorado-based research and consulting firm that specializes in tourism.
Yet, ski resorts generally purchase the same insurance that any other business purchases, says Brian Derouin, insurance program manager for Wells Fargo Special Risks, which has had a ski area insurance program for nearly 50 years. “The insurance is the same,” he said. “Obviously, the risks are different. It’s not a controlled environment. Mother Nature has the final say about what happens sometimes.”
In fact, Derouin says, while a typical business, like a car dealership, would carry medical payments coverage to pay the medical bills of someone who slips and falls on the lot, none of the insurance carriers that have worked with the ski industry for many years offer medical payments coverage. So resorts generally self-insure and do as much as they can to remind participants of the risks they assume when they strap in and head up the mountain.
The backs of lift tickets routinely include disclaimers, for instance, and season-pass buyers often must sign waivers when making their purchases. For its part, the NSAA endorses the industry’s seven-point skier responsibility code (see next page), and 28 states have skier responsibility statues that delineate who is responsible for what risks. Byrd believes that these statutes have effectively informed guests of their responsibility.
Still, resorts are covered only to a certain point, so they must be cautious to avoid negligence claims. If a skier, for example, knocks the padding off of a lift tower by colliding with it, the ski area could be held liable if the next person that skis by runs into it and is injured.
As a result, the first line of risk mitigation in the industry is education. Ideally, first-time skiers would take lessons, says Byrd. “We know that if we can get them really good instruction on how to ski, they are more likely to become a lifelong skier and a lifelong safe skier,” he said. It also doesn’t hurt that resorts often charge for the lessons, making this one of the few instances in which a company can see direct, immediate revenue from risk-reduction efforts.
Improving safety is not always this easy, however. Perhaps the biggest challenge for ski resort risk managers is educating people with whom they have little, if any, direct contact. “I work in a job where at least one of our customers gets hurt every single day,” said Paul Baugher, risk manager for Boyne Resorts’ western operations and patrol director of Crystal Mountain in Washington state.
Baugher is also a partner at International Mountain Guides, which leads climbing, trekking and mountaineering expeditions around the world, and he says managing risk in a climbing environment is actually easier than in a skiing environment. This is not because the types of risk differ much; it is because the opportunities to communicate the risks to participants do. “With skiers, I don’t see them. They come through in mass and go up on the hill.” In climbing, this proximity problem disappears. “You have direct communication with that person on the end of the rope.”
In both environments, the participants carry most of the burden to reduce risk themselves, Baugher says, so he sees his job as helping them manage the risks they face. Doing so can be especially challenging with skiers because the nature of the sport can lull them into believing they are safer than they actually are.
“Just take powder, for example,” said Baugher. “If a person is skiing in powder, and they’re a good powder skier, as the powder gets deeper and deeper, they’re seduced.” The snow conditions entice them to move to steeper terrain. “Powder is sending the absolute wrong message about the risk because, as something gets steeper, the greater the avalanche risk is.”
Educating skiers and snowboarders about the importance of helmets has increased their usage, and some ski areas are now requiring employees to wear helmets while they’re on the hill performing their duties, according to Belin, who also works as a ski instructor. The ski school he works at provides helmets free of charge to students who do not have them.
“Helmet usage has completely changed over the past 10 years,” he said. Nationally, the number of people wearing helmets has “gone from basically zero” to around 70%. Helmets, however, can induce compensating behavior: wearing helmets makes skiers feel they have more protection against injury, so they take greater risks, like skiing faster than their skills allow.
In fact, the number of fatalities has not dropped significantly in the past decade even as helmet use has increased, according to NSAA estimates. As a result, the NSAA promotes helmet use but emphasizes the importance of skiers and snowboarders acting safely as their best defense against injury.
To help skiers and snowboarders manage their own risks, Baugher focuses on communicating to them through markers, consistency of practice, and the internet and Twitter. His resort’s markers include yellow hazard signs, rope lines, orange flags on snowmobiles and what ski patrollers refer to as bamboo: long, thin poles that mark areas to avoid.
The signs themselves have become more sophisticated over the years. Baugher prefers to post signs that have pictures on them and that, to the extent possible, indicate the specific hazard and what participants can do to mitigate it. To this end, he helped the NSAA design a sign that addresses a risk that has existed as long as skiers have ventured off groomed runs, but has only recently become better understood: snow immersion suffocation (SIS).
Better known as “tree-well death,” SIS can occur in deep-powder conditions when skiers and boarders ride near the base of trees, where a void of snow often exists since branches block accumulation near the trunk. Skiers may fall in the hole, flip over and suffocate.
“Given the way that snow science works and the warmth of the tree, the snow differs at the base of the tree from out on an open run, and it can be very difficult to extricate yourself,” said Byrd.
It occurs most often in the West, with almost no incidents reported in the East, where deep-snow conditions are less common, but experiments show that up to 90% of people caught in tree wells could not dig themselves out on their own. This makes it vital for anyone who rides in deep powder to ski with a partner who always remains within sight.
The SIS warning goes beyond the typical yellow hazard sign; it warns about suffocation, shows a picture of a skier upside down and reminds skiers to keep their partners in sight. There is also a counterintuitive aspect to warnings, however. It is actually important that ski resorts not do too much to protect skiers. Otherwise, they can reduce skiers’ internal risk monitor or “lookout,” which is one of their best defenses against injury. If a resort tells skiers about a known tree hole off of the main, groomed run, for example, it can create a false sense of security that the resort will always be vigilant and comprehensive in marking safety hazards. “If I start marking holes like that,” said Baugher, “I will make the sport less safe.”
Consistency is the key to avoid diluting skiers’ lookout. “Every time we mark something different than what our normal, consistent pattern is, we have to take it seriously,” he said. “If we make an exception, we have to be very clear about why we’re doing it and what the cost associated with doing it is.”
Consistency is also important across the industry, so insurers work with the resorts to develop best practices to make skiing safer, says Derouin. Wells Fargo, for example, conducts operational surveys with its customers to help them minimize injuries and works with the NSAA to conduct safety workshops. This sharing of best practices creates “a rising tide of guest safety knowledge” that benefits everyone, says Byrd. “If Aspen has a particularly effective safety strategy, it is great to share that with Telluride or Crested Butte. It’s a win/win for everyone.”
Emerging technologies, such as smartphones, are another way to reinforce guest education. Baugher tries to use every channel available to engage in conversations with guests, whether those conversations are in-person or virtual. Crystal Mountain uses its website, its ski patrol’s blog and Twitter to remind guests of the importance of being cautious on the mountain. If the mountain has had a great deal of snow, the website will include a message celebrating the fortunate weather and reminding guests to ride with a partner to help prevent SIS.
Big snowfalls also increase avalanche risk, however, so runs are opened in stages, which allows Baugher to concentrate both the risk and his patrol staff on the run that is opening. Crystal’s Twitter followers are among the first to know which runs are opening, so they can be among the first to ski or ride that run. “There’s an incentive to follow us on Twitter because that’s how they’ll get fresh powder and be at the front of the line,” he said. “And that’s a way I can interject safety messages.”
With too much snow comes avalanche risk; with too little comes financial risk. The 2011-12 ski season, which saw some of the lowest snowfall totals in two decades, had a 15% drop in visitors from the previous year, according to NSAA estimates. Last season’s visits totaled 51 million compared to a record 60.5 million during the 2010-11 season.
Byrd blames the weather more than the economy: rather than remaining localized as it has in some seasons, the lack of snow affected nearly every region of the country. Half of the resorts that responded to the NSAA’s end-of-season survey opened late, and 48% closed early due to the lack of snow.
“Most regions were affected by Mother Nature,” said Byrd. “She was not very generous to us, both in terms of natural snowfall and in terms of cold temperatures. Because we rely on colder temperatures to make snow.”
Even with snowmaking capabilities, resorts battle the backyard effect: If potential visitors don’t see wintery weather outside their windows, they don’t think to go skiing. “If there’s no snow in Boston or New York City, the New England, Vermont and New York state resorts have a hard time encouraging people to go skiing,” said Byrd. “That’s certainly something we see, even though we have amazing snow-making capabilities.”
To combat this, resorts work with local media to report snow totals and show camera feeds of the mountain to reassure skiers that snow awaits. Resorts also pre-sell season passes for the following season in the spring, usually at a discount, to help reduce weather-related revenue fluctuations.
Another option is weather insurance. But even though policies can be written in a variety of ways—with snowfall totals as triggers, for example—the majority of ski areas don’t purchase them. The cost is usually just too great, says Derouin.
Instead, many resorts have worked to diversify their offerings to reduce the risk of too little snow. “It’s expensive to operate a ski area if you’re trying to pay for a year’s expenses out of a four-month season,” said Derouin.
Year-round lodging is one popular revenue source to become, as Derouin puts it, “less dependent on a lift ticket.” Given their local terrain, most can offer wonderful hiking and other outdoor activities. One of these popular summer options, ziplining, carries its own risks, however. Zipline harnesses have weight limitations, for example, so resorts have installed scales that, rather than displaying a weight, trigger a red or green signal that indicates whether the potential rider is an acceptable weight or too heavy.
For now, however, all eyes are on the skies. Ski resorts will always remain dependent upon snowfall and wintery conditions to be profitable, and so far, the NSAA is encouraged by the anecdotal evidence it has gathered about the strength of those sales for this season.
Byrd also expects this ski season to be better than last season. He equates last year to the last really bad one he remembers for the industry: 1980-81. Fortunately, that was more of a one-year blip on the radar than the start of a downward, multi-year trend, as the following season saw a 22% uptick in skier visits. “Mother Nature cooperated in the following season,” said Byrd. “There was a real pent-up demand.”
He expects something similar this winter. “We anticipate we’re going to bounce back again. There’s a real resiliency in the ski industry and the skiing public for wanting to ski.”