My Personal Risk Management Journey Through Hurricane Irma

My blog post is a bit delayed this week because of the unwelcome​ visit to Central Florida by Hurricane Irma. Like the thousands of people in Texas affected recently by Hurricane Harvey, families in several areas of South Florida, particularly the Florida Keys, face weeks and months of rebuilding. And, sadly, there were losses of life, though thankfully it was limited.

I am relieved that, despite widespread power outages, flooding, and property damage, our IIA Headquarters staff emerged safely from the storm and our offices reopened today to serve our global members.

It is often said that we manage risks every day in our personal lives. Whether we are deciding on insurance coverage for our homes or automobiles or investment strategies for retirement, we are constantly evaluating potential risks and making decisions that will mitigate them based on our personal appetites for risks.

As I reflect on the past week, I can’t help but think about all of the decisions I made in preparation for the potential arrival of Hurricane Irma. While I was consciously thinking about risks, or defining or making decisions as I do as a CEO in my professional capacity, I was nonetheless very much in a risk management mode not unlike that modeled on a corporate level by COSO or ISO.

I recognize that I was guided by an overarching objective: to weather the looming hurricane as safely and comfortably as possible with minimal property damage. Every key decision I made was guided by the potential risks that could undermine that overall objective. In the end, I made a number of crucial decisions that turned out to be prudent. And, as is often the case in the world of business, I made a few costly decisions to minimize risks that, fortunately, didn’t materialize.

Let’s take a look back at the week that was:

• On Sunday, Sept. 3, weather forecasters were raising the prospect that Irma would take a track that would bring it very close to Florida. Given the size of the storm, and the fresh images of Hurricane Harvey’s impact on Houston, everyone’s antennas naturally went up. During a routine visit to a nearby supermarket, I decided that I would secure some extra bottled water. Using risk management jargon, I assessed the likelihood of a direct hit by Irma to Central Florida at that time as low, but the potential impact given the size of the storm as high. I grabbed three cases of water in the midst of panic buying that would only grow more frantic as the storm got closer.
• As Monday and Tuesday passed, the forecasted track of the storm was becoming more ominous. A direct hit on Florida by what was at that time a Category 5 hurricane looked increasingly likely. By day, I was sequestered with IIA Headquarters leadership making risk management decisions for the organization. After work hours, my wife and I went about managing risks on the home front. We continued to secure water and food in anticipation of a prolonged recovery period. I fueled up both of our vehicles in case we needed to evacuate. By this point, the potential impact was high — and growing daily.
• On Wednesday, I purchased a generator for our home. One of the most significant impacts of a major hurricane is the potential loss of electrical power. The last time a major hurricane hit Central Florida, many were without power for a week or more. This turned out to be one of the wisest decisions of the week.
• On Thursday, we announced that IIA Headquarters would close the next day and on Monday, and I headed to a nearby beach community to prepare our vacation home for the approaching storm. Our home there is equipped with aluminum hurricane shutters, which have to be manually assembled. It was a lot of work in hot and humid conditions, but given the potential for catastrophic impact on property near the Atlantic beaches, I was compelled to mitigate the risks through every means at my disposal. Once finished, I headed back to Central Florida, where deep concern was truly setting in over the forecasted track of the storm.
• By Friday, Irma’s track was looking better for inland Central Florida, albeit not for other areas of the state. A more westerly movement was now likely, forecasters predicted, but Central Florida could still endure a lot of damage. The storm was only one day away, and I joined many others in foraging for even more water, food, and other essentials that still might be needed in its wake. Gas, already in short supply, was increasingly scarce, but I was able to secure enough to power the generator for at least 24 hours in the event we lost electrical power.
• Saturday was surreal. The hurricane was marching through the Florida Straits, lashing both the South Florida and North Cuba coasts. A forecasted turn hadn’t yet occurred, so the precise track still couldn’t be determined. Meanwhile, aided by our daughter and her husband, we secured all of our patio and lawn furniture and moved plants and anything else that wasn’t tied down indoors.
• By Sunday morning, I became convinced that the potential for loss of power was now extremely likely. Up until that point, I had held out the possibility that the new generator wouldn’t be needed, so it remained in the box. But on Sunday I pulled it out and and assembled it for its likely use. By the afternoon, the winds were noticeably stronger. Irma was delivering a devastating blow to the Florida Keys, but it still looked likely to trek up the west coast of Florida, which would be good news for Central Florida. Then, like the devastating Hurricane Charley 13 years earlier, the storm turned more inland. It began heading due north after crossing Naples in Southwest Florida. We were now in the crosshairs.
• On Sunday evening, the winds became deafening, and we could do nothing more than watch and listen. Then, at 10:45 p.m., we lost electrical power as I had feared. Thank goodness for the generator, I thought to myself. Fortunately, we escaped a direct hit as the center of the storm passed just to the west of our home sometime around 2 a.m. Monday morning. But we still received damaging winds and rains. By 7 a.m., a weakened storm had moved well north, and I navigated through debris outside my house to assess the damage. Our neighborhood was hit hard, with trees laid across the streets. We would not be going anywhere soon. But thanks to our generator, we were able to meet our essential power needs.
• By Tuesday morning, power had been restored — much earlier than I had feared, especially when I learned nearly a million people in Central Florida still were without. The roads were cleared, so we headed off to check on our vacation home. There, we found more damage than in inland Central Florida, but nothing serious. The shutters had held, and I am confident they saved several windows and the interior of the house — another risk management decision that turned out to be wise.

I’m sharing my experiences to illustrate how natural it is to manage risks when faced with a potential crisis. Throughout the week, I was faced with crucial decisions. Should we evacuate, or stay behind and weather the storm? Should I spend money on a generator, or take my chances that we would not lose electrical power? Should I dedicate an afternoon to installing hurricane shutters, or hope the storm would take a westerly track and miss the eastern Florida coast?

As in the world of business, I can now look back on the week and reflect on the decisions I made. Some were prudent, some were not. For example, we ended up with much more bottled water than we needed, but we will use it eventually. Overall, I was pleased with the way I managed the risks. My objective was met: We weathered Hurricane Irma “as safely and comfortably as possible with minimal property damage.”

I would like to hear your experiences on managing risks on a personal basis.