1. Property coverage pays for damage to or theft of your car.
2. Liability coverage pays for your legal responsibility to others for bodily injury or property damage.
3. Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.

An auto insurance policy comprises six kinds of coverage. Most countries require you to buy some, but not all, of these coverages. If you’re financing a car, your lender may also have requirements. Most auto policies are for six months to a year.

In the United States, your insurance company should notify you by mail when it’s time to renew the policy and to pay your premium.

Home insurance

Home insurance provides compensation for damage or destruction of a home from disasters. In some geographical areas, the standard insurances exclude certain types of disasters, such as flood and earthquakes, that require additional coverage. Maintenance-related problems are the homeowners’ responsibility. The policy may include inventory, or this can be bought as a separate policy, especially for people who rent housing. In some countries, insurers offer a package which may include liability and legal responsibility for injuries and property damage caused by members of the household, including pets.

Health insurance

Health insurance policies by the National Health Service in the United Kingdom (NHS) or other publicly-funded health programs will cover the cost of medical treatments. Dental insurance, like medical insurance, is coverage for individuals to protect them against dental costs. In the U.S., dental insurance is often part of an employer’s benefits package, along with health insurance.

* Disability insurance policies provide financial support in the event the policyholder is unable to work because of disabling illness or injury. It provides monthly support to help pay such obligations as mortgages and credit cards.
* Disability overhead insurance allows business owners to cover the overhead expenses of their business while they are unable to work.
* Total permanent disability insurance provides benefits when a person is permanently disabled and can no longer work in their profession, often taken as an adjunct to life insurance.
* Workers’ compensation insurance replaces all or part of a worker’s wages lost and accompanying medical expenses incurred because of a job-related injury.

Casualty insurance

Casualty insurance insures against accidents, not necessarily tied to any specific property.

* Crime insurance is a form of casualty insurance that covers the policyholder against losses arising from the criminal acts of third parties. For example, a company can obtain crime insurance to cover losses arising from theft or embezzlement.
* Political risk insurance is a form of casualty insurance that can be taken out by businesses with operations in countries in which there is a risk that revolution or other political conditions will result in a loss.

Life insurance

Life insurance provides a monetary benefit to a decedent’s family or other designated beneficiary, and may specifically provide for income to an insured person’s family, burial, funeral and other final expenses. Life insurance policies often allow the option of having the proceeds paid to the beneficiary either in a lump sum cash payment or an annuity.

Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies and regulated as insurance and require the same kinds of actuarial and investment management expertise that life insurance requires. Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree will outlive his or her financial resources. In that sense, they are the complement of life insurance and, from an underwriting perspective, are the mirror image of life insurance.

Certain life insurance contracts accumulate cash values, which may be taken by the insured if the policy is surrendered or which may be borrowed against. Some policies, such as annuities and endowment policies, are financial instruments to accumulate or liquidate wealth when it is needed.

In many countries, such as the U.S. and the UK, the tax law provides that the interest on this cash value is not taxable under certain circumstances. This leads to widespread use of life insurance as a tax-efficient method of saving as well as protection in the event of early death.

In U.S., the tax on interest income on life insurance policies and annuities is generally deferred. However, in some cases the benefit derived from tax deferral may be offset by a low return. This depends upon the insuring company, the type of policy and other variables (mortality, market return, etc.). Moreover, other income tax saving vehicles (e.g., IRAs, 401(k) plans, Roth IRAs) may be better alternatives for value accumulation.

Property insurance
This tornado damage to an Illinois home would be considered an “Act of God” for insurance purposes

Property insurance provides protection against risks to property, such as fire, theft or weather damage. This includes specialized forms of insurance such as fire insurance, flood insurance, earthquake insurance, home insurance, inland marine insurance or boiler insurance.

* Automobile insurance, known in the UK as motor insurance, is probably the most common form of insurance and may cover both legal liability claims against the driver and loss of or damage to the insured’s vehicle itself. Throughout the United States an auto insurance policy is required to legally operate a motor vehicle on public roads. In some jurisdictions, bodily injury compensation for automobile accident victims has been changed to a no-fault system, which reduces or eliminates the ability to sue for compensation but provides automatic eligibility for benefits. Credit card companies insure against damage on rented cars.
Driving School Insurance insurance provides cover for any authorized driver whilst undergoing tuition, cover also unlike other motor policies provides cover for instructor liability where both the pupil and driving instructor are equally liable in the event of a claim.
* Aviation insurance insures against hull, spares, deductibles, hull wear and liability risks.
* Boiler insurance (also known as boiler and machinery insurance or equipment breakdown insurance) insures against accidental physical damage to equipment or machinery.
* Builder’s risk insurance insures against the risk of physical loss or damage to property during construction. Builder’s risk insurance is typically written on an “all risk” basis covering damage due to any cause (including the negligence of the insured) not otherwise expressly excluded. Builder’s risk insurance is coverage that protects a person’s or organization’s insurable interest in materials, fixtures and/or equipment being used in the construction or renovation of a building or structure should those items sustain physical loss or damage from a covered cause.[16]
* Crop insurance “Farmers use crop insurance to reduce or manage various risks associated with growing crops. Such risks include crop loss or damage caused by weather, hail, drought, frost damage, insects, or disease, for instance.”
* Earthquake insurance is a form of property insurance that pays the policyholder in the event of an earthquake that causes damage to the property. Most ordinary homeowners insurance policies do not cover earthquake damage. Most earthquake insurance policies feature a high deductible. Rates depend on location and the probability of an earthquake, as well as the construction of the home.
* A fidelity bond is a form of casualty insurance that covers policyholders for losses that they incur as a result of fraudulent acts by specified individuals. It usually insures a business for losses caused by the dishonest acts of its employees.
* Flood insurance protects against property loss due to flooding. Many insurers in the U.S. do not provide flood insurance in some portions of the country. In response to this, the federal government created the National Flood Insurance Program which serves as the insurer of last resort.
* Home insurance or homeowners’ insurance: See “Property insurance”.
* Landlord insurance is specifically designed for people who own properties which they rent out. Most house insurance cover in the UK will not be valid if the property is rented out therefore landlords must take out this specialist form of home insurance.
* Marine insurance and marine cargo insurance cover the loss or damage of ships at sea or on inland waterways, and of the cargo that may be on them. When the owner of the cargo and the carrier are separate corporations, marine cargo insurance typically compensates the owner of cargo for losses sustained from fire, shipwreck, etc., but excludes losses that can be recovered from the carrier or the carrier’s insurance. Many marine insurance underwriters will include “time element” coverage in such policies, which extends the indemnity to cover loss of profit and other business expenses attributable to the delay caused by a covered loss.
* Surety bond insurance is a three party insurance guaranteeing the performance of the principal.
* Terrorism insurance provides protection against any loss or damage caused by terrorist activities.
* Volcano insurance is an insurance that covers volcano damage in Hawaii.
* Windstorm insurance is an insurance covering the damage that can be caused by hurricanes and tropical cyclones.

Liability insurance

Liability insurance is a very broad superset that covers legal claims against the insured. Many types of insurance include an aspect of liability coverage. For example, a homeowner’s insurance policy will normally include liability coverage which protects the insured in the event of a claim brought by someone who slips and falls on the property; automobile insurance also includes an aspect of liability insurance that indemnifies against the harm that a crashing car can cause to others’ lives, health, or property. The protection offered by a liability insurance policy is twofold: a legal defense in the event of a lawsuit commenced against the policyholder and indemnification (payment on behalf of the insured) with respect to a settlement or court verdict. Liability policies typically cover only the negligence of the insured, and will not apply to results of wilful or intentional acts by the insured.

* Public liability insurance covers a business against claims should its operations injure a member of the public or damage their property in some way.
* Directors and officers liability insurance protects an organization (usually a corporation) from costs associated with litigation resulting from mistakes made by directors and officers for which they are liable. In the industry, it is usually called “D&O” for short.
* Environmental liability insurance protects the insured from bodily injury, property damage and cleanup costs as a result of the dispersal, release or escape of pollutants.
* Errors and omissions insurance: See “Professional liability insurance” under “Liability insurance”.
* Prize indemnity insurance protects the insured from giving away a large prize at a specific event. Examples would include offering prizes to contestants who can make a half-court shot at a basketball game, or a hole-in-one at a golf tournament.
* Professional liability insurance, also called professional indemnity insurance, protects insured professionals such as architectural corporation and medical practice against potential negligence claims made by their patients/clients. Professional liability insurance may take on different names depending on the profession. For example, professional liability insurance in reference to the medical profession may be called malpractice insurance. Notaries public may take out errors and omissions insurance (E&O). Other potential E&O policyholders include, for example, real estate brokers, Insurance agents, home inspectors, appraisers, and website developers.

Credit insurance

Credit insurance repays some or all of a loan when certain things happen to the borrower such as unemployment, disability, or death.

* Mortgage insurance insures the lender against default by the borrower. Mortgage insurance is a form of credit insurance, although the name credit insurance more often is used to refer to policies that cover other kinds of debt.
* Many credit cards offer payment protection plans which are a form of credit insurance.

Other types

* Collateral protection insurance or CPI, insures property (primarily vehicles) held as collateral for loans made by lending institutions.
* Defense Base Act Workers’ compensation or DBA Insurance provides coverage for civilian workers hired by the government to perform contracts outside the U.S. and Canada. DBA is required for all U.S. citizens, U.S. residents, U.S. Green Card holders, and all employees or subcontractors hired on overseas government contracts. Depending on the country, Foreign Nationals must also be covered under DBA. This coverage typically includes expenses related to medical treatment and loss of wages, as well as disability and death benefits.
* Expatriate insurance provides individuals and organizations operating outside of their home country with protection for automobiles, property, health, liability and business pursuits.
* Financial loss insurance or Business Interruption Insurance protects individuals and companies against various financial risks. For example, a business might purchase coverage to protect it from loss of sales if a fire in a factory prevented it from carrying out its business for a time. Insurance might also cover the failure of a creditor to pay money it owes to the insured. This type of insurance is frequently referred to as “business interruption insurance.” Fidelity bonds and surety bonds are included in this category, although these products provide a benefit to a third party (the “obligee”) in the event the insured party (usually referred to as the “obligor”) fails to perform its obligations under a contract with the obligee.
* Kidnap and ransom insurance
* Legal Expenses Insurance covers policyholders against the potential costs of legal action against an institution or an individual.
* Locked funds insurance is a little-known hybrid insurance policy jointly issued by governments and banks. It is used to protect public funds from tamper by unauthorized parties. In special cases, a government may authorize its use in protecting semi-private funds which are liable to tamper. The terms of this type of insurance are usually very strict. Therefore it is used only in extreme cases where maximum security of funds is required.
* Media Insurance is designed to cover professionals that engage in film, video and TV production.
* Nuclear incident insurance covers damages resulting from an incident involving radioactive materials and is generally arranged at the national level. See the Nuclear exclusion clause and for the United States the Price-Anderson Nuclear Industries Indemnity Act)
* Pet insurance insures pets against accidents and illnesses – some companies cover routine/wellness care and burial, as well.
* Pollution Insurance which consists of first-party coverage for contamination of insured property either by external or on-site sources. Coverage for liability to third parties arising from contamination of air, water, or land due to the sudden and accidental release of hazardous materials from the insured site. The policy usually covers the costs of cleanup and may include coverage for releases from underground storage tanks. Intentional acts are specifically excluded.
* Purchase insurance is aimed at providing protection on the products people purchase. Purchase insurance can cover individual purchase protection, warranties, guarantees, care plans and even mobile phone insurance. Such insurance is normally very limited in the scope of problems that are covered by the policy.
* Title insurance provides a guarantee that title to real property is vested in the purchaser and/or mortgagee, free and clear of liens or encumbrances. It is usually issued in conjunction with a search of the public records performed at the time of a real estate transaction.
* Travel insurance is an insurance cover taken by those who travel abroad, which covers certain losses such as medical expenses, loss of personal belongings, travel delay, personal liabilities, etc.

If you have approached your project or programme well, you will have developed a Risk Plan/Strategy document. Risk needs to be proactively managed, as opposed to allowing it to manage you and the environment around you.

Many people are afraid of Risk Management and some Project and Programme Managers are often reluctant to publicise risk to executive management. The reality is that things change, assumptions become false, expectations are not met and suddenly you can find yourself facing a very different looking environment. For a risk plan to really help (and play its role) it needs to be accompanied by a “proactive” approach by applying Risk Avoidance, Transference, Mitigation and Acceptance.

Most well run organisations will have risk managed at four distinct levels which are;

Corporate or Strategic Programme Project Operational

To do this effectively, a framework for managing risk needs to be designed and implemented to address the following list of 9 hows:

how risks are identified; how information about their probability and potential impact is addressed; how risks are quantified; how options to deal with them are identified; how decisions on risk management are made; how all these decisions are implemented; how actions are evaluated for their effectiveness; how appropriate communication mechanisms are set up and supported; how stakeholders are engaged on an ongoing basis

But this is just the beginning because it’s all very well having a thorough framework documented and sitting pretty on the shelf with a tick in the box, but risk management needs to instilled within the people of the organisation. A healthy culture of risk management needs to exist and for this to happen, everyone involved needs help in appreciating and understanding risk within the organisation.

This often requires sponsorship from the top down and if leaders at the corporate level understand this too, they will take the time to ensure that risk is taken seriously and subsequently managed well. Setting up a good risk culture is a real challenge and the UK OGC suggests that it involves at least the following:

strategic planning; legal requirements; agreements and contracts; communication techniques and information management; staff matters, including how staff can be motivated and involved; education opportunities and continual professional development; continuous improavement and/or analytical techniques; how the organisation is monitored and evaluated; resource management, incuding equal opportunities and delegation.

The subject of risk management is vast and if you need help with some guidelines for a framework, a great place to start is the OGC’s Guidelines for Managing Risk.

More detail can also be found in the following publications:

Managing Successful Programmes OGC Management of Risk Guidelines OGC’s Achieving Excellence Guides Management of Risk : Practitioner guide

Some if not all of these can be purchased from the TSO in London.

If you need a list of generic pain points that risk management will address to support your case for better risk management within your organisation, you could start with these:

increased certainty and fewer surprises; better service delivery; more effective management of change; more efficient se of resources; better management at all levels through improved decision making; reduced waste and fraud and better value for money; innovation; management of contingent and maintenance activities.

To build your case, don’t forget the more specific pains that your organisation is already suffering.

I read an interesting article about risk and opportunity in the aerospace industry. Whilst PMBOK considers risk as both negative and positive, the folk in aerospace consider risk as negative and opportunity as positive. Good risk management is not about fear of failure, but removing barriers to success.

After all, project and programme management is success oriented, focused on producing products and services for customers. When the success orientation is combined with risk management, opportunity management emerges, which is the identification of opportunities to help attain project goals, and the identification and implementation of actions to capture those opportunities.

Below are the keys to success taken from a Space Risk Management Symposium. Whilst their view on risk is slightly different from others, the points are not rocket science and can help most people who are responsible for complex projects or programmes.

Sound risk and opportunity management cannot save a poorly planned program with bad processes; Prevent the competition between risks and opportunities; Prevent unhealthy competition between teams; Risk and opportunity management provide diminishing returns if overused; The costs of pursuing opportunities and managing risks must be weighed against the expected benefits; An environment should be created to encourage risk and opportunity management; Risks and opportunities are not just normal variations in plan; Recognise the difference between risks and opportunities; Opportunities are not “positive risks”.

No matter where you sit within the organisation, if you see that risk is not being appropriateley addressed, take the initiative, pluck up the courage and set out to facilitate some change. Remember that managing risk is the alternative to being managed by risk.

You can subscribe to receive more articles like this at the author’s consulting web site and blog at www.llewellyn-group.com

Some people might not be worried about all types of personal insurance because they are young. Young people tend to underestimate the need for homeowners insurance because they are only renting. They might not be aware that there is renter insurance available that could replace lost articles should the apartment burn to the ground or it might cover items that were stolen in a robbery.

Other people will get personal insurance because they must have it because the law requires it. Many people will purchase insurance policies for the automobile they use for personal outings and there are others that will insure a vehicle for business use. The level of coverage might depend on if the owner wants the car replaced if it is wrecked or if they want to limit insurance coverage to simple liability.

Some automobile owners will need a special policy to include an underage driver. The levels for insurance protection might chance under these circumstances because the driver is inexperienced and is more likely to have an accident. A new driver can attend a driver’s education course and get a discount on the personal insurance they buy and this discounted amount will vary by company and the State they live in.

Some driver’s might need personal insurance for the motorcycle they drive to work. The rates for insuring these motor vehicles will be based on many things such as the driving record, type of motorcycle and the number of years that they have been licensed. A separate driver’s license is required for these vehicles and driving schools are recommended before asking for motorcycle insurance.

There are other items that people can choose personal insurance for. Some people buy boats and will need insurance coverage for this vehicle and for the boat dock where it will be stored. Most States require a boating course to be completed before insurance will be granted. Some home insurance policies will combine various vehicles under one policy and insurance discounts will apply when this is done.

Some families will get life insurance policies to protect family member in a variety of ways. Some of these personal insurance policies protect investments and others will ensure that families will have a substantial income to live on after a loved one has passed away. A new life insurance policy can be established for babies and the rates will be adjusted accordingly on those policies and will be low due to the age of the child.

Some people choose umbrella insurance policies because they want added protection to cover all claims. The premiums for these personal insurance policies might be considerably higher than regular homeowner policies but the protection benefits are substantial. Homeowners are freed from worrying about being sued for accidents that take place at home or on the major highways.

Recreational boats are owned by many and just as cars are covered by insurance recreational boats too need insurance that protects the boat and its owner from many unforeseen happenings; accidents, natural disasters, willful damage and more.

Most insurance companies offer insurance policies for recreational boats. And these are mainly two kind’s boat policies and yacht policies. Boat policies are general with few options while yacht insurance policies have greater range of options. As a recreational boat owner you need to know which marine craft are classified as recreational and what kind of insurance cover you will need to protect your investment and passion.

Here are a few guidelines:

1. When buying insurance buy from a recognized company. You can buy recreational boat insurance online too but while attempting to save money make sure you get dependable and comprehensive coverage. General boat policies offer P&I coverage of approximately USD 500,000 maximum.

2. When buying a recreational boat find out what costs of maintenance and insurance will be. For example new boats are cheaper to insure and wooden boats and high speed vehicles are expensive. Similarly diesel powered boats cost less in terms of insurance than gas powered boats.

3. Insurance rates are lower if you ensure that all safety regulations/norms are taken care off.

4. Many insurance companies offer competitive rates if you have other policies with them like home, health, or auto. So the first step when buying a recreational boat policy is to check with your existing insurance carrier.

5. Find out the advantages of higher deductibles and payment of annual premiums. Always check online what is on offer as far as recreational boat insurance is concerned.

6. Update your knowledge on what comprehensive boat insurance should contain. Find out what physical damage and liability mean. As a recreational craft owner you need to take informed decisions when purchasing boat insurance.

7. Take the help of an insurance expert to decide on whether agreed value is better or actual cash value. It is important to understand what insurance terminology means before purchasing an insurance policy for a recreational boat.

8. Always read the policy in minutest detail and understand it completely. An insurance policy must work to your advantage and so it is important for you to know what you are paying for.

The World Wide Web has articles and tips on marine insurance written by experts as well as boat owners. Be an informed boat owner and keep abreast about boats, insurance, and savings. Follow the law and maintain your boat well. Take recommended courses and ensure that your boat driving record is above reproach. Small steps will ensure that you are eligible to buy recreational boat insurance at great discounts.

There are recreational boat owners associations like Boat US that offer tips and other facilities to members. Always comparison shop this will give you great advantages. There are websites for buying boat insurance that have online tools that will give multiple quotes and well as easy comparison. Make use of such directories /platforms online and you will be able to get the best insurance coverage for your recreational boat.

SUPREME COURT OF FANTASY JUDGMENT

Cameron Pettigrew, et al. v. Fidelity Investments, Inc.

ON PETITION FOR WRIT OF CERTIORARI FROMTHE FANTASY SPORTS INDUSTRY

Decided December 26, 2009

Cite as 1 F.J. 10 (2009)

Factual Background

Cameron Pettigrew, a relationship manager in the Private Client Group at Fidelity Investment’s (“Fidelity”) Westlake, Texas office, was a self-proclaimed “Fidelity Man” and had been employed with the company since 2007.  He accumulated an impressive resume, which contained multiple company honors, including being the only person chosen for an exclusive, 10-member program (Future Leaders of Westlake) who was not already in a management position.  In September 2009, he was offered a position at Fidelity’s prestigious Wall Street branch, but Pettigrew said he chose to decline the offer due to the high cost of living in New York City.  While employed at Fidelity, Pettigrew was the commissioner and organizer of at least one office fantasy football league comprised of other Fidelity employees, including managers and team leaders, whereby each participant paid $20 to join the league. 

On October 20, 2009, Fidelity had in place and in effect company policies that were distributed via email which prohibited gambling activities and playing fantasy football on company time.  Additionally, Fidelity blocks Internet access to any and all websites that have anything to do with fantasy sports and gambling — not to mention blocking sites like theonion.com, nintendo.com and thousands of other non work-related websites.  According to an anonymous Fidelity employee who is also a commissioner of an office fantasy league, Fidelity “does grant access to nfl.com, espn.com, yahoo.com, etc.; but if you then try to click on one of their fantasy links, you will get a giant message on your screen letting you know that access to the fantasy section of that website has been blocked.”

On October 20, 2009, Fidelity management discovered the aforementioned fantasy leagues after intercepting emails and instant messages directed towards Pettigrew, who admitted that he was aware of Fidelity’s policy, but claimed it was “poorly communicated and ignored by leadership.”  He also argued that several other Fidelity leaders and managers participated in other office fantasy leagues notwithstanding the company’s policy.

Pettigrew says he never played fantasy football before coming to Fidelity.

“Last season I was approached by one of the managers who asked that I be in his league. I knew vaguely about the policy at the time but figured that if a manager was involved than the rule was probably just something of an outdated law, like how it’s illegal in Michigan for a woman to cut her own hair without asking her husband first.”

Despite his efforts, Pettigrew’s instant message conversations with colleagues about Trent Edwards’ poor performance prompted Fidelity management to interrogate him for ninety minutes about his fantasy sports participation as if he was “some sort of international gambling kingpin”.  After the interrogation was concluded, Pettigrew was sent home for the day.

On October 21, 2009, Pettigrew, along with three of his colleagues and fellow fantasy football commissioners, were informed via telephone that they were terminated from Fidelity.  Said Fidelity spokesman Vin Loporchio:

“We have clear policies that relate to gambling.  Participation in any form of gambling through the use of Fidelity time or equipment or any other company resource is prohibited.  In addition to being illegal in a lot of places, it can also be disruptive.  We want our employees to be focused on our customers and clients.”

Procedural History

Pettigrew and three other Fidelity employees were terminated on October 21, 2009 for violating company policies prohibiting gambling and playing fantasy football on company time.  Despite his appeals to Fidelity, the Termination Explanation of his U5 form (Uniform Termination Notice for Securities Industry Regulation) reads “VIOLATION OF COMPANY GAMBLING POLICY INVOLVING FANTASY FOOTBALL.” 

Pettigrew, his colleagues, and the fantasy sports industry as a whole seek clarification of whether fantasy sports are considered gambling under the law and in the workplace.  Pettigrew and his colleagues also seek an advisory opinion on whether they may have an actionable claim for wrongful termination against Fidelity.

The Supreme Court of Fantasy Judgment has accepted certiorari and provides the following opinion, which has been ruled on unanimously by the bench.

Issues Presented

(1)     Are fantasy sports considered a form of gambling?

(2)     Is there any legal recourse Pettigrew and the other terminated employees can take against Fidelity for wrongful termination? 

Decision

I.  ARE FANTASY SPORTS CONSIDERED A FORM OF GAMBLING?

According to Paul Charchian, president of the Fantasy Sports Trade Association (“FSTA”), no fantasy sports company has been the subject of prosecution for gambling, and no individual person has been the subject of prosecution for gambling related to fantasy sports participation.  Charchian also said that he was “worried that this case marks the start of a backlash by employers against the growing field on online sports gaming.”  While Charchian’s concerns are meritorious and justified, this Court will not allow the misconception about fantasy sports being considered a form of gambling to continue any further.  What employers allow their employees to do on company time is left to them, but no longer will companies be permitted to associate, correlate or define fantasy sports participation as a form of gambling.

From the very infancy of this nation, the separation of powers has helped maintain and strengthen our democracy.  That being said, this Court strictly defers to Congress for the determination of whether fantasy sports fall within the ambit of gambling.  Quite clearly, Congress has excluded fantasy sports from the very definition of gambling.  The Unlawful Internet Gambling Enforcement Act of 2006 (H.R. 4411) was intended to “prevent the use of certain payment instruments, credit cards, and fund transfers for unlawful Internet gambling, and for other purposes”.  Under §5362 of the bill, the term “bet” or “wager” does not include…

(viii)     any participation in a simulation sports game, an educational game, or a contest that—

           (I)  is not dependent solely on the outcome of any single sporting event or nonparticipant’s singular individual performance in any single sporting event;

           (II)  has an outcome that reflects the relative knowledge of the participants, or their skill at physical reaction or physical manipulation (but not chance), and, in the case of a simulation sports game, has an outcome that is determined predominantly by accumulated statistical results of sporting events; and

           (III)  offers a prize or award to a participant that is established in advance of the game or contest and is not determined by the number of participants or the amount of any fees paid by those participants.”

Additionally, the Internet Gambling Prohibition Act of 2006 (H.R. 4777) also expressly excludes fantasy sports from its definition of gambling.  The bill defines a “bet” or “wager” to include wagering on sporting events, lotteries and games of chance.  A “bet” or “wager” does not include securities and commodities transactions, indemnity and insurance contracts, and fantasy sports leagues.

Courts throughout the country, however, have long recognized that it would be “patently absurd” to hold that “the combination of an entry fee and a prize equals gambling, ”because if that were the case, countless contests engaged in every day would be unlawful gambling, including “golf tournaments, bridge tournaments, local and state rodeos or fair contests, . . . literary or essay competitions, . . . livestock, poultry and produce exhibitions, track meets, spelling bees, beauty contests and the like,” and contest participants and sponsors could all be subject to criminal liability. 

Courts have distinguished between bona fide entry fees and bets or wagers, holding that entry fees do not constitute bets or wagers where they are paid unconditionally for the privilege of participating in a contest, and the prize is for an amount certain that is guaranteed to be won by one of the contestants (but not the entity offering the prize).  Courts that have examined this issue have reasoned that when the entry fees and prizes are unconditional and guaranteed the element of risk necessary to constitute betting or wagering is missing.

“A prize or premium differs from a wager in that in the former, the person offering the same has no chance of his gaining back the thing offered, but, if he abides by his offer, he must lose; whereas in the latter, each party interested therein has a chance of gain and takes a risk of loss . . .The fact that each contestant is required to pay an entrance fee where the entrance fee does not specifically make up the purse or premium contested for does not convert the contest into a wager.”

In addition to the fact that fantasy leagues are not gambling and that stat service providers (i.e., ESPN, Yahoo, CBS Sports) do not win anything, participants suffer no “loss” in participating in the fantasy leagues.  Fantasy sports participants pay a one-time, non-refundable entry fee to participate in the leagues, and receive in consideration for that fee the benefit of the stat provider’s extensive administrative, statistical and analytical services throughout the relevant sports season. Only at the end of the sports season are prizes awarded, in amounts fixed by the contracts that govern participation in the leagues.  Accordingly, in paying for the right to participate in the leagues, participants simply do not “lose” anything, and certainly suffer no cognizable “gambling” loss. Whether or not a participant is a successful league manager, their entry fee never hangs in the balance in any way in connection with their participation in the league.  Indeed, once participants have selected their team and begin their season, the fee cannot be recovered. There is no “loss” on these facts, and this exchange of consideration is an “ordinary contract,” in which “both parties may ultimately gain by entering into the agreement.”

Based on Congress’s unambiguous language in two separate bills regarding unlawful Internet gambling, it is clear to this Court that fantasy sports are not considered a form of gambling.  Any further insinuation, inference or correlation made between fantasy sports and gambling would be irresponsible, incorrect, and potentially defamatory.

 II.  IS THERE ANY LEGAL RECOURSE PETTIGREW AND THE OTHER TERMINATED EMPLOYEES CAN TAKE AGAINST FIDELITY FOR WRONGFUL TERMINATION?

It is no mystery why companies such as Fidelity have policies prohibiting fantasy sports participation on company time and resources.  After all, the very fact that such a policy even exists at Fidelity (albeit in email form) is the reason why Pettigrew and his colleagues were terminated.  Said Fidelity spokesman Vin Loporchio: “We have clear policies that relate to gambling.  Participation in any form of gambling through the use of Fidelity time or equipment or any other company resource is prohibited.  In addition to being illegal in a lot of places, it can also be disruptive.  We want our employees to be focused on our customers and clients.” 

It is undeniable that the fantasy sports industry has a prominent role in today’s society and economy.  Chris Russo, chairman and CEO of Fantasy Sports Ventures, served as the NFL’s senior vice president of new media and publishing from 2000-2006.  He estimated that in 2000, the year he persuaded NFL Commissioner Paul Tagliabue to launch the league’s first official fantasy football competition, there were approximately 2 million people playing fantasy football in the United States.  Now, according to the FSTA,, an organization representing 110 member companies that was founded in the late 1990’s to provide a forum for interaction between hundreds of existing and emerging companies in the growing fantasy sports industry, there are an estimated 27 million Americans participating in fantasy sports who generate over $1 billion each year for the industry. 

While it appears that the fantasy sports industry is immune to the current economic recession, a lot of other companies are struggling to survive and may not have sufficient staffing.  Given these factors, some companies may be more sensitive than normal to employees who are wasting valuable company time.  According to John Challenger, chief executive of the employment consulting firm Challenger, Gray & Christmas, fantasy football is costly to company productivity.  In 2008, his consulting firm estimated that fantasy leagues cost Corporate America around $10 billion annually.  He arrived at this figure based on 13.6 million people playing fantasy football (according to the FSTA) who earn an average annual income of $100,000 and spend over an hour per week managing fantasy sports teams.  Challenger opined that the average fantasy sports participant costs his/her company around $45 per week in lost productivity.

While this Court previously cleared up the distinction between gambling and fantasy sports (see above), we grant the benefit of the doubt to Fidelity that their company policy included fantasy sports participation within the parameters of its guidelines.  In fact, after the story was made public in a December 11, 2009 article written by Drew Davison of the Fort Worth Star Telegram, Fidelity received enormous backlash and condemnation by the fantasy sports community for associating fantasy sports with gambling.  Fidelity backtracked through Loporchio and acknowledged that fantasy sports were legally not considered gambling. 

“We aren’t making any judgments on fantasy leagues. If it is permitted legally, people can do this on their own time. Our company policies relate to the professional conduct of our employees. We do not want our company’s equipment and resources to be used for these purposes.” Loporchio added that the activities can be disruptive to the company’s business and Fidelity wants their employees to be focused on customers and clients.

Challenger said that the key was Fidelity’s corporate policy banning gambling/fantasy football on the job.  This made it easy to dismiss an employee that’s caught.  However, even if Fidelity did not have a policy prohibiting such activity, they could justly reprimand, suspend or fire an employee if it is believed their productivity is limited because he/she is spending more time on fantasy sports than business-related matters.  While Challenger describes Fidelity’s action as an apparent “capital punishment for a misdemeanor crime,” he warns that employees should be careful about calling attention to their personal productivity gaps in an environment where there are a lot of people vying for your job.

Challenger’s warning is given with good reason.  That is because most employees in the United States are considered “at will” employees.  Since the last half of the 1800’s, employment in each and every state has been considered “at will,” or terminable by either the employer or employee for any reason whatsoever.  The employment at will doctrine avows that when an employee does not have a written employment contract and the term of employment is of indefinite duration, the employer can terminate the employee for good cause, bad cause, or no cause at all.  The law generally presumes that you are employed at will unless you can prove otherwise.  There are three exceptions to the employment at will doctrine which can bring rise to actionable claims for wrongful termination: 1) public policy exception; 2) implied contract exception; and 3) covenant of good faith and fair dealing exception.  This Court will examine the three exceptions to at will employment and determine whether Pettigrew and his colleague have an actionable claim.

Under the public policy exception to employment at will, an employee is wrongfully discharged when the termination is against an explicit, well-established public policy of the State (such as firing an individual for filing a workers’ compensation claim after being injured on the job, or for refusing to break the law at the employer’s request).  Under Texas law, the public policy exception only applies based strictly on public policy derived from the state constitution and statutes.  Since there are no provisions or amendments in the Texas state constitution, nor are there any statutes that clearly enunciate the relevant public policy, Pettigrew and his colleagues cannot invoke the first exception to the employment at will doctrine.

The second major exception to the employment at will doctrine is applied when an implied contract is formed between an employer and employee, even though no express, written instrument regarding the employment relationship exists.  Unfortunately for Pettigrew and his colleagues, Texas has refused to recognize the implied contract exception.  The Texas Supreme Court has held that a letter offering a position of employment, the classification of an employee as “permanent” rather than “temporary,” and the identification in company documents of a scheduled retirement date for the employee some 22 years after employment was initiated were insufficient in sum to create an implied contract of employment for a specific duration.   If Texas had recognized this exception, perhaps Pettigrew and his colleagues would have a meritorious argument.  According to Pettigrew, he was aware of Fidelity’s policy prohibiting gambling and fantasy football on company time, but he was unaware that a violation of this policy was a fireable offense.  If Fidelity failed to codify its policies, procedures and penalties in an employee handbook or email document, then Pettigrew could argue that Fidelity breached its contract of employment.  In cases where a company issues an employee handbook which outlines specific procedures, including reprimands and opportunities to correct one’s behavior if an employee is alleged to have violated company policy, then other courts have analyzed such provisions according to the traditional requirements for the creation of a contract: offer, acceptance, and consideration.  Since Texas law does not recognize this exception to the employment at will doctrine, Pettigrew and his colleagues cannot invoke the second exception either.

The third exception to the employment at will doctrine is the exception for a covenant of good faith and fair dealing.  This exception represents the most significant departure from the traditional employment at will doctrine.  Rather than narrowly prohibiting terminations based on public policy or an implied contract, this exception – at its broadest – reads a covenant of good faith and fair dealing into every employment relationship.  It has been interpreted to mean either that employer personnel decisions are subject to a “just cause” standard or that terminations made in bad faith or motivated by malice are prohibited.  A majority of the states do not recognize this exception, including Texas, so Pettigrew and his colleagues have no actionable claim under this exception either.

Since no exception to the employment at will doctrine is applicable in this case, Pettigrew and his colleagues do not appear to have an actionable claim against Fidelity for wrongful termination.  While this Court acknowledges the harsh nature of the punishment in comparison to the “crime” charged, it is beyond the scope and duty of the legal system to impose its will on corporations regarding their ability to terminate an at will employee who is in direct violation of a company policy.  The only recourse this Court grants to Pettigrew and his colleagues is for Fidelity to amend the termination explanations on the employees’ U5 forms by removing any and all references to gambling.  It would be inherently detrimental to Pettigrew and others to inappropriately be cited or referenced for gambling when clearly fantasy football participation does not fall within the definition of gambling.  While a future at Fidelity is not in the cards for these gentlemen, there is no reason to prevent or diminish their chances for other employment opportunities despite this unfortunate incident and blemish on their respective resumes.

IT IS SO ORDERED. 

Michael A. Stein, Esq.

Owner and Chief Justice

michael.stein@fantasyjudgment.com

www.fantasyjudgment.com

REFERENCES

http://www.star-telegram.com/news/story/1825336.html http://fantasyfootball.fanhouse.com/2009/12/17/fired-over-fantasy-football-the-unfortunate-case-of-cameron-pet/22 http://www.fantasysportsbusiness.com/wordpress/2009/12/21/source-fidelity-tried-to-make-an-example-out-of-us/ http://www.reuters.com/article/idUSTRE5BF5KQ20091216 http://thomas.loc.gov/cgi-bin/query/z?c109:H.R.4411: http://thomas/loc.gov/cgi-bin/query/z?c109:H.R.4777: State v. Am. Holiday Ass’n, Inc., 727 P.2d 807, 809, 812 (Ariz. 1986) (en banc) Humphrey v. Viacom, Inc., et al., No. 06-2768  (D.N.J., June 20, 2007) Las Vegas Hacienda, Inc. v. Gibson, 359 P.2d 85, 86-87 (Nev. 1961). 10.  D.C. Code § 16-1702; Ga. Code Ann. § 13-8-3; 720 Ill. Comp. Stat. 5/28-8; Ky. Rev. Stat. Ann. § 372.020; Mass. Gen. Laws ch. 137, § 1;Ohio Rev. Code Ann. § 3763.02; N.J. Rev. Stat. § 2A:40-5; S.C. Code Ann. § 32-1-20. http://sportingnews.com/contract/cancellation.html Martin v. Citizens’ Bank of Marshallville, 171 S.E. 711, 713 (Ga. 1933). http://www.usnews.com/money/business-economy/small-business/articles/2009/09/21/the-reality-of-fantasy-sports.html http://www.fsta.org http://moneywatch.bnet.com/saving-money/blog/devil-details/can-you-be-fired-for-fantasy-football/1230/ Shane and Rosenthal, Employment Law Deskbook, §16.02, §16.03[8] (1999) Charles J. Muhl, Monthly Labor Review “The Employment At Will Doctrine: Three Major Exceptions” (January 2001) Webber v. M.W. Kellogg Company, 720 S.W.2d 124 (Tex. 1986). Pine River State Bank v. Mettilee, 333 N.W.2d 622 (Minn. 1983).

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Top 7 Ways To Generate Long Term Wealth
By Daegan Smith

How can you make sure that your wealth can sustain you throughout the years when income becomes less and less of an option?

Read on for details.

Stocks
Stocks are said to be the best way to generate long term wealth. How can this be so? Aren’t stocks for the savvy businessmen? Isn’t there a chance that stock could lose its value overnight? Isn’t that a bit too risky?

Yes, stocks can be risky. If you do not have a good understanding of securities and the stock market.

There are many kinds of stocks. High risk stocks can make or break investors – some become exceedingly wealthy overnight, and some exceedingly broke. At an advanced age this sort of investing is out of the question.

However, there are what are called low-risk stocks. These come in the form of blue-chip stocks (companies that always perform well in the markets), bonds, and other low risk investments. The secret here is to invest in stocks that have a history of performing well year after year. These stocks may not bring back the biggest profits, but they perform well enough to generate a steady source of wealth.

Annuities
What is an annuity?
By strict definition, the word “annuity” means “an amount payable annually.” This refers to a contract made by an insurance company that allows you to save funds for retirement with the tax deferred. You can then receive income for life or for a set period of time.

Annuities are a great way to create long-term assured pay-outs. They are very much like insurance but are a definitely well structured means of creating wealth over a long period of time. This kind of investment is recommended for those who are contemplating retirement.

Save
The best way to generate wealth is to save it.

If a person were to earn a million dollars per year, and spend a million dollars per year also, would he be considered a millionaire? Of course, not. He’s probably closer to bankruptcy than wealth!

Living within your means allows you to save more for the future. This allows you to enjoy your hard earned money when you most need it. Also, saving earn interest. There have been cases when people have been able to live of the interest of their savings. If this is your goal, you should plan for such, and save to accomplish it.

Plan your expenditures
Planning your expenditures does not apply only to today’s needs. If you plan to generate long-term wealth try planning for your expenses even in the future. This will help you keep you books straight so that in the future, you will not be bound by ’sudden’ expense needs since you will have prepared for them in advance.

You should also plan create contingency plans in the event that there be a sudden emergency that befalls you. This will shield your savings from taking a big hit when an occasion arises.

Know your limits
It would do well if you could know your limits. Man has a set number of years on earth and he can only do so much. Don’t get caught up in the moment and think that you can sustain an income edge today indefinitely. If you know your limits, you can then allocate your time, finance, and effort in way that will optimize what resources you have.

Insurance
Take out an insurance policy. This is probably the most important and most popular means to generating long-term wealth. Choose an insurance company that has been proven to deliver its promises. The financial security an insurance company delivers – be it through pensions, life insurance, and others – will do well to make your retirement comfortable.

Start a Business and Keep Busy
Small businesses or other income generating means can continue to generate wealth for you even until the next generation. Some businesses were started by people in their advanced age. Take Col. Harlan Sanders for example. He started the business that would be KFC when he was at retiring age. And it still makes money until today.

Daegan Smith is an Expert Internet Network Marketer. “Learn How To Make ,717 In Less Than a Week While Quickly And Easily EXPLODING Your Network Marketing Organization Without EVER Buying a Single Lead?” http://www.internetmlmsuccess.com mailto:netmlmsuccess@aweber.com

Article Source: Articles island – Free article submission and free reprint articles

Are you someone who is looking to make sure that your site is both attractive and informative to the people around you? You know that if you take the time to think about it that written, article-based content is one of the best ways to go when it comes to figuring out what you are looking for.

When you think about all the traffic that you can get from your articles in this fashion, not to mention all the sales that you can get from it as well, you’ll know why you need to think about making sure that you take advantage of the Article Equalizer and learn about what it can do for you. You know that without good written content, you’ll be in a very negative place.

When you are thinking about making sure that you will attract the right people to your site, you’ll find that something that you need to think about is your subject matter. What is so special about what you do? For that matter, what is it that you do? Many industries are finding out that they are something of a mystery to their customers, and this can lead to bad implications down the line.

If you want to make sure that people really appreciate what it is that you do and what you can do for them, you’ll find that Article Equalizer can help you out with that. When you are looking to see what you can do to advance yourself and to make sure people know what you are about, you’ll find that looking into this possibility is one of the first things that you can do.

If you want to see what Article Equalizer can do for you, think about things in terms of search engine optimization. What can you do to bring more and more people to your site? Remember that people are looking for relevance and good information above all, and that you won’t get very far if you try to “trick” the search engines into taking a look at what you do and what you have. With articles, you can be sure that you will be able to give them what they want at a very low risk and cost to you. Take some time to think about what you can do when it comes to getting started with this program because this might be one of the most important things that you can do.

Don’t delay when it comes to making your website more attractive and more interesting when it comes to content. Content is king, as they say, and you’ll find that with very little time, you’ll be in a place where you need to think about what you can do to make sure that you stay on top. If you are looking to make sure that you can attract people based on the power and information in your articles, you’ll find that this program is one that will bring you the hits in the least amount of time and for the least amount of effort. Look at Article Equalizer today and see what it can do for you.

As we mentioned in previous articles, it is important that people own a business understand what is business insurance, so they can protect their business in case of any unforeseen event happened causing hardship to the business owner and their family such as business store burned down one day, if you don’t carry insurance, you would endured some hard times after that. You make sure you have insurance for anything of importance, or anything that could prevent me from earning a living. In this article we will discuss the important role of key person life insurance purchased by the company will warrant the long term stability of company’s operation and success.
A key person is one who is recognized as being essential to business success and whose death would result in substantial loss to the company.
The key person may be insured
1.to the value of 1 or 2 years income
2.the amount could represent the financial loss to the business.

Here are some characteristics of key person insurance:
1.the premiums paid are not a tax deductible expense.
2.the premiums are not a taxable benefit to the life insured.
3.dividends are not considered to be taxable income, until they exceed the ACB of the policy.
4.annual Cash Surrender Value increases are not considered as taxable income.
5.the death benefit is non-taxable when received.
6.private corporations would have the share value increased by the corporate owned (key person) insurance. Proceeds (less the return of premium) are added to the Capital Dividend Account.

I hope this information will help. If you need more information of the above subject, please visit my home page at:
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/
http://businessinsurance20.blogspot.com/

http://businessinsurance21.blogspot.com/

All rights reserved. Any reproducing of this article must have all the links intact.

Foreword

I wish to acknowledge the support of Mr John Tookey University of Auckland for his generously support and valuable advises.

1. Introduction

Risk management is one of the most critical project management practices, to ensure a project be successfully completed Risk management is thus in direct relation to the successful project completion. Project management literature describes a detailed and widely accepted risk management process, which constructed from four iterative phases known as risk management plan

• Risk identification

• Risk estimation

• Risk response

• Planning and execution

Risk Identification

In this stage , we identify and name the risks , there are different sorts of risks and we need to decide on a project by project basis what to do with each type.

Risk Quantification

Risk need to be quantified in two dimensions. The impact of the risk needs to be assessed. The probability of the risk occurring needs to be assessed. For simplicity, rate each on a 1 to 4 scale. The larger the number, the larger the impact or probability. By using a matrix, a priority can be established.

Fig 1 quantification scale matrix (Ref. 11)

Risk Response

There are four things you can do about a risk. The strategies are:

• Avoid the risk. Do something to remove it. Use another supplier for example.

• Deflect the risk. Make someone else responsible. Perhaps contracting out or insurance against (damage , liability, personnel liability etc

• Mitigate the risk. Take actions to lessen the impact or chance of the risk occurring. If the risk relates to availability of resources, draw up an agreement and get sign-off for the resource to be available.

• Accept the risk. The risk might be so small the effort to do anything is not worthwhile or a contingency plan may be developed to deal with possible effects.

Risk Control

The final step is to continually monitor risks to identify any change in the status, or if they turn into an issue. It is best to hold regular risk reviews to identify actions outstanding, risk probability and impact, remove risks that have passed, and identify new risks.

1.1 Risk management and construction

The construction industry is subjected to more risk and uncertainty than many other industries. The process of taking a project from initial investment appraisal to completion and into use is complex, generally bespoke, and entails time-consuming design and production processes. It requires a multitude of people with different skills and interests and the co-ordination of a wide range of disparate, yet interrelated, activities. Such complexity is further compounded by many uncontrollable external factors (Flanagan and Norman, 1983). The construction industry has a poor reputation in coping with risks, many projects failing to meet deadlines and cost targets. Clients, contractors, the public and others have suffered as a result (Edwards 1995). This study will focus on applying project risk management strategies on construction of Sydney opera house which is a well-known case for cost overrun.

1.2 The aim of the study

The aim of this study is not to reduce the great achievement of construction such a complicated building that changed the face of the city but looking form management point of view to

? Identify and quantify the project risks that been overlooked.

? Highlight the dangers associated with using poor estimate.

1.3 About the Sydney Opera House

? The owner :State government of New South Wales

? Architect :Jorn Utzon

? Engineer: Ove Arup & Parteners

? Cost: $102 million

The Sydney Opera House is the busiest performing arts centre in the world. Since its opening in 1973, it has brought countless hours of entertainment to millions of people and has continued to attract the best in world class talent year after year.

1.4 About the Building

There are nearly 1000 rooms in the Opera House including the five main auditoria. There is also a Reception Hall, five rehearsal studios, four restaurants, six theatre bars, extensive foyer and lounge areas, sixty dressing rooms and suites, library, an artists’ lounge and canteen known as the “Green Room”, administrative offices and extensive plant and machinery areas. The building covers about 1.8 hectares (4.5 acres) of its 2.2 hectare (5.5 acre) site. It has about 4.5 hectares (11 acres) of usable floor space. It is approximately 185 m (611 ft) long and 120m (380 ft) wide at its widest point. The highest roof vault (above the Concert Hall) is 67m (221 ft) above sea level.

The roofs are made up of 2,194 pre-cast concrete sections. These sections weigh up to 15.5 tones (15 tons) each. They are held together by 350 km (217 miles) of tensioned steel cable. The roofs weigh 27,230 tones and are covered with exactly 1,056,056 Swedish ceramic tiles arranged in 4,253 pre-cast lids.

The entire building weighs 161,000 tones. It is supported on 580 concrete piers sunk up to 25 m (82 ft) below sea level. The roofs are supported on 32 concrete columns up to 2.5 m (8 ft) square. The exterior and interior walls, stairs and floors are faced with pink aggregate granite which was quarried at Tarana in New South Wales. The two woods used extensively to decorate the interiors are brush box and white birch plywood which were both cut in northern NSW. There are 6,225 sq m (67,000 sq ft) of glass, made in France, in the mouths of the roofs and other areas of the building. It is in two layers – one plain and the other demi-topaz tinted. About 2,000 panes in 700 sizes were installed.

There are 645 km (400 miles) of electrical cable. 120 distribution boards regulate the power supply, equivalent to the needs of a town of 25,000 people. Twenty-six air-conditioning plant rooms move more than 28,500 cubic meters (1,000,000 cubic feet) of air per minute through 19.5 km (12 miles) of ducting.

Fig 2 Sydney opera house (Ref. 6)

Fig 3 Sydney opera house during construction (Ref. 7)

Fig 4 Sydney opera house shells (Ref. 7)

Fig 4 Sydney opera house shells (Ref. 7)

1.5 Design Stage

The original concept for the project was a sketch submitted by Danish architect , Jorn Utzon .Judges selected it from an international open competition that ended with 233 entries from 11 countries. Thought happy to win the competition Utzon was mildly shocked .although his concept had caught the attention of the judges, it consisted only if simple sketches with no plans or even perspective drawings , because the design was so unique , some people presumed it would also be inexpensive to build. No one knew how it would be build , and some experts questioned that it could be built at all.

In spite all uncertainty , the initial project cost estimate was pit at $7million.The government would use profits from a series of state run lotteries to pay the project.

The government was worried that the people scrutinizing the design might raise question about the potential problems hat would stall the project they thus quickly mover ahead and divided the work into three main contracts :the foundation and the building except the roof, the roof, and the interior and equipment.

1.6 Construction stage

Many of the world’s best-known construction companies were involved in building

Sydney Opera House including Arups Structural Engineering, Hornibrook and Rider Hunt, the construction work of S.O.H was divided into three distinct stages as follows (Ref. 19)

• Stage I

Sub structure , concrete structure from the foundation up to the auditoria seating levels excluding any finishes.

• Stage II

Superstructure or shells , concrete roof vaults or major and minor halls an restaurants , including the claddings.

• Stage III

Everything not included in stages I and II , stage towers, all interior finishes, exterior paving and cladding, glass walls , all electrical and mechanical services.

After he was elected premier of New South Wales in 1965, Askin attempted to force Utzon reduce costs by withholding payments. In 1966 Utzon resigned and returned to his native Denmark. He never even returned to see his masterpiece completed.

The construction of the Sydney Opera House was now handed over to a group or Australian architects. Fortunately, the exterior had already been completed by then so that the impact of the altered design on the overall structure was minimal. The project was finally completed in 1973 after a construction period of 14 years and an expenditure of over $A100 million, almost 15 times the estimated budget.

2. Risk management strategies at S.O.H

2.1 Financial

Despite of all cost escalation , taxpayer had little to pay .Virtually all the costs were covered by the proceeds of State Lotteries. The continued need to the subside the running costs of the opera house were financed by the continuation of the Lottery State. The first estimate for the Sydney Opera House was $7.2 million in Australian dollars. Once started, however, costs kept rising and just to complete the building cost $102 million.

2.2 Political

Political risks are often occur in government project as they often hide information affecting the community’s support, which in turn affect the effectiveness of the feasibility study . S.O.H we mostly severely effect by political decisions

2.2.1 Media and public deception

In S.O.H. the original budget of seven million Australian dollars was not a real but a political budget .The labour government of New South Wales the main proponent of the S.O.H, wanted the project started before elections in March 1959-this would reduce the risk of the stopping the project in case Labour lost the elections (8).

2.2.2 Deceptive cost estimate

Kim Utzon explains in lieu of his father “It was a political decision to publicize a low budget for the building, which was expected to gain approval in the political system, but which very quickly was exceeded. So even if the cost overrun turned to be 1400% in relation to the publicized budget, this budget was an eight of the real budget of the building .So the real overrun is only 100% the rest was politics”.

2.2.3 Political construction date

The start of construction for stage I was fixed ., largely for political reasons , as the 2nd March 1959.Thus Proceeding with construction before completing the design process which is a great risk .

2.2.4 Political design changes

On 1966 major hall was changed from dual purpose for concert and opera to a single purpose concert hall, the dual purpose was a requirement of the competition .

2.3 Structural

2.3.1 The Supporting points

Arup and his engineers knew very well that the cross-section shape Utzon chose was far from ideal known structures, however they could not suggest changing to the shape as it will alter the appearance of the roof drastically.

2.3.2 The roof

A question should be asked if this design is achievable?. The competition judges choose a complex art design without asking how it will be deigned? later on it was a major cause for delaying the roof design if this point was been considered they should either choose a simple shape or a known geometry, at this stage computer program analysis was not yet been introduced that means only manual process can be used to calculate the forces acting on the structure.

2.3.3 Lack of suitable boundary condition.

Another technical problem that the engineer had to solve was the lack of boundary condition that leads to some earthwork as sub base for the structure foundation.

2.4 Technical

Utzon, ware of possible technical problems since his design required advanced technology not yet available, requested additional time to tackle those challenges Utzon faced the task of converting the concept into a design form which a structure could be built, but he had no prior experience in the design and construction of such a large building. Because of this lack of plans, detailed design drawings, and estimates of materials, little existed from which cost could be determined.

2.4.1 Design errors and omissions

• Unfortunately, the roof shells were too heavy for the supporting columns that were already built, so these were demolished and rebuilt. These and several other setbacks led to delays and increasing cost overruns.

• The original design called for two theatres. The government changed its mind and required the building to be altered and that four theatres now be incorporated into the design

• The foundation been demolished to suit the new roof design loads.

2.4.2 Fitness for purpose.

? The main design overlooked acoustic requirements which is the main purpose of the building and had to be altered at later stage.

? The Running costs for S.O.H proved expensive , it was a very labour intensive building .In 1974 , it operation cost was $A6M, of which only $A2M was covered by the revenue. Thus costs ruled out small scale opera and the Australian Opera were forced to seek a cheaper venue.

2.5 Construction

Engineers who revised the concept noted that the roof shells were much larger and wider than any shells seen so far. Further, because they stuck up so height, they would act like sails in strong winds blowing up the harbour. Thus, the roof would have to be carefully designed and constructed to resist such wind pressure.

The construction was estimated to take about five years at a cost of A$7 million. Ignoring his request, the government pressured Utzon into starting construction in 1959, two years ahead of the architect’s proposed schedule.

? The lack of preparation soon backfired. After the completion of the grand podium with an enormous, 86 meter (282ft) wide stair, several years were spent reworking the design of the roof.

• Three tower cranes imported from France for this job costing $100,000 each and it was the first building constructed in Australia using tower cranes.

• Unfortunately the roof shells were too heavy for the supporting columns that were already built, so these were demolished and rebuilt.

2.6 What goes wrong Consequences?

? Coast overrun 1300% (Ref. 18)

As feared many experts the project become an engineering financial debacle, lasting 15 years and costing $107 million ($100 million over the initial estimate).

? Schedule overrun 250% (Ref. 18)

? Media and public scandal

Fig 5 Time /cost Escalation

? Management conflict occur between the client and the architect that cause him to resign before the end of stage III .

3. Risk identification quantification

3.1 Identification

By looking at the project there are some risks appear not used have the most adverse effect on the project

1. Poor Cost Estimate.

2. Incomplete design.

3. Failure to keep within the cost estimate

4. Failure to achieve the required completion date.

5. Changes in project scope and requirements.

6. Design changes.

7. Pressure to deliver project on an accelerated schedule.

8. Inaccurate contract time estimate

9. Lack of communication between project participants.

10. Inadequately defined roles and responsibilities.

11. Insufficient skilled staff.

12. Political risks.

3.2 Qualitative risk analysis

Qualitative risk analysis assesses the importance of the identified risks and develops the prioritized lists ,using the 1 to 4 scale matrix discussed above to quantify identified risks

Risk Probability Impact Risk Importance

1. Poor Cost Estimate. 3 3 Critical

2. Incomplete design. 1 3 High

3. Failure to keep within the cost estimate 3 4 Critical

4. Failure to achieve the required completion date. 4 3 Critical

5. Changes in project scope and requirements. 1 3 High

6. Design changes. 2 2 Low

7. Pressure to deliver project on an accelerated schedule. 2 2 Low

8. Inaccurate contract time estimate 3 4 Critical

9. Lack of communication between project participants. 3 4 Critical

10. Inadequately defined roles and responsibilities. 1 4 High

11. Insufficient skilled staff. 1 2 Low

12. Political risks. 4 2 Medium

Three risks were selected for detailed qualitative risk assessment (refer to sheet 1 , 2 and 3)

Risk Risk Control

1. Poor Cost Estimate. Client, Contractor

2. Incomplete design. Client , Contractor

3. Failure to keep within the cost estimate Client

4. Failure to achieve the required completion date. Client, Contractor

5. Changes in project scope and requirements. Engineers

6. Design changes. Contractor

7. Pressure to deliver project on an accelerated schedule. Engineers

8. Inaccurate contract time estimate Contractor, Client

9. Lack of communication between project participants. Engineers, Contractor, Client

10. Inadequately defined roles and responsibilities. Engineers, Client

11. Insufficient skilled staff. Client

12. Political risks. Contractor

3.2 Risk response

3.2.1 Risk Avoidance

As discussed most of the risk could be avoided by only

• Completed design .

• Estimating at a very detailed level.

• Not selecting untested design .

• Using local Architecture office will reduce many and more communication and experienced architecture designer

3.2.2 Risk transfer

• Using a fixed price contract will transfer construction risk to the contactor.

• Obtaining Insurance to cover costly risks.

3.2.3 Mitigate the risk

Risk analysis shows that no clear management process for controlling the project however using an experienced project manager would effectively reduce probability or impact of risks to an acceptable level.

4. Assessment forms

Following a three assessment forms for 3 of the significant risks

Performa for a Qualitative Risk Assessment (sheet 1)

Reference No: 6 Date:25/06/2007

Potential risk: Importance of Risk: Low

Design changes

Probability Medium

Consequence Medium

Stage of the project affected by this risk:

Construction stage

Statement of risk:

Cost and schedule overrun

(The factor that could cause it to occur)

Political business interest

Site problems

(any relationship or dependency on other risks)

Incomplete design

(the likelihood of occurring)

Medium

(how it could be affected)

Design checking prior leaving the design office

Project:

Sydney opera house

Client:

New South Wales government Risk Analyzed by:

Khaled

Performa for a Qualitative Risk Assessment (sheet 2)

Reference No:1 Date: 25/06/2007

Potential risk: Importance of Risk: Critical

Poor Cost Estimate

Probability High

Consequence High

Stage of the project affected by this risk:

Design stage

Construction stage

Statement of risk:

major source of complaint

time consuming

(the factor that could cause it to occur)

Changes in project scope and requirements

(any relationship or dependency on other risks)

Inadequately defined roles and responsibilities.

(the likelihood of occurring)

Height

(how it could be affected)

Effective project management

Clearly defined roles

Project:

Sydney opera house

Client:

New South Wales government Risk Analyzed by:

Khaled

Performa for a Qualitative Risk Assessment (sheet 3)

Reference No:9 Date: 25/06/2007

Potential risk: Importance of Risk: Critical

Lack of communication between project participants. Probability high

Consequence high

Stage of the project affected by this risk:

Construction stage

Design stage

Statement of risk:

Insufficient working drawing details

Late and in adequate information

Major costly errors.

(the factor that could cause it to occur)

Lack of management

Interest conflict between project participation

(any relationship or dependency on other risks)

Incomplete design

(the likelihood of occurring)

Height

(how it could be affected)

Proper project management

Project:

Sydney opera house

Client:

New South Wales government Risk Analyzed by:

Khaled

5. Lessons learned

• Risk must be identified to be managed

• A poorly defined risk structure will breed more risks.

• A proper risk management strategy would planning.

• All designs and calculations should be checked before they leave the design office further check calculation should be made by the authority , many errors that escape are picked up and corrected during construction .This often cause a delay to the project and might effect the cost.

• The goal is to prevent political and business interests from interfering with design and thus to arrive at an outcome as close as possible to the original design drawings.

• Continually monitor risks to identify any change in the status, or if they turn into an issue. It is best to hold regular risk reviews to identify actions outstanding, risk probability and impact, remove risks that have passed, and identify new risks.

• Risk management is not one off activity instead, it should be applied continuously through the project life.

• The best way to control budget is not to proceed with the building unlit you have all the drawings complete.

6. Conclusion

Study clearly identify the great importance of risk management on construction projects, negligence will lead to an expensive cost effecting the project successes.

A risk analysis project shows a large number qualitatively ranked as 1 , those risks have a high probability of occurrence and height consequence shared between the client 42% , the contractor 36% and the engineer 21% .

This indicates that it was a very risky project nevertheless risks were either downplayed or ignored , and not much was done to keep them under control, the project management strategies was only focused on keeping the project going no matter how it is going .

Finally although the opera house put Sydney on the world map, both architecturally and culturally but from project management perspective it was a spectacular failure as a consequence of ignoring risk management.

References

1. http://www.abc.net.au/news/newsitems/200504/s1355304.htm [Accessed 2 May 2007].

2. http://en.wikipedia.org/wiki/Sydney_Opera_House [Accessed 2 May 2007].

3. Edwards, L. (1995). Practical risk management in the construction industry, Thomas Telford, London

4. Flyvbjerg, Bent, “Design by Deception: The Politics of Megaproject Approval”, Harvard Design Magazine, Volume 22, 2005.

5. http://www.hughpearman.com/articles/sydney.htm [Accessed 2 May 2007].

6. http://www.greatbuildings.com/buildings/Sydney_Opera.html [Accessed 2 May 2007].

7. http://www.gids.nl/sydney/opera.html [Accessed 2 May 2007].

8. Murray ,21-22.

9. Murray, P: The Saga of the Sydney Opera House, 2004, Spon Press (UK), ISBN 0415325218

10. http://www.new7wonders.com/fileadmin/resources/finalists/Fun_Facts_about_Sydney_Opera_House.pdf [Accessed 25 Jun 2007].

11. Neville Turbit http://www.projectperfect.com.au/info_risk_mgmt.php

12. John Tookey civil 703 lecture notes University of Auckland.

13. Office of Project Management Process Improvement “Project Risk Management Handbook”

14. Peter Murray “The dramatic storey of the design and construction of the icon of modern Australia”(London and New York: Spon Press,2004),105.

15. Roger Flangan & George Norman “Risk Management and Construction”. Blackwell Scientific Publications ISBN 0-632-02816-5.

16. http://www.theirm.org/publications/documents/Risk_Management_Standard_030820.pdf [Accessed 2 May 2007].

17. http://www.wsws.org/arts/1998/dec1998/oper-d04.shtml [Accessed 2 May 2007].

18. Woodward, Hugh PMP, PowerPoint Presentation to NASA on March 23, 2005,

19. Yozo Mikami “Utzon’s Sphere” page 46 Shokikusuha Tokyo ISBN 4-395-00712-0

20. Ziegler, Oswald L. (ed) Sydney Builds an Opera House., page 25, Oswald Ziegler Publications, 1973

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