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Financial Planning > UHNW Client Services > Family Office News

Insurer IT Systems Survive WTC Attacks

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NU Online News Service, Sept. 20, 12:45 p.m. – Insurance companies at and near the Manhattan World Trade Center were able to get their information systems up and running quickly last week in spite of the horrific destruction caused by the Sept. 11 attacks, the companies are reporting.

Although Kemper Corp. reported spending more than $500,000 to replace lost equipment, the company?which had offices on the 35th and 36th floors of 1 World Trade Center?had recovered all business data from that site by the next morning, according to Rick Dale, vice president of information technology at Kemper.

All of the 225 Kemper employees in the trade center were safely evacuated, and no one was injured, but the company did lose six Windows NT servers and all of the desktop systems in its offices, Dale says. The servers handled e-mail and local data storage for the offices, which did business in commercial lines, workers’ compensation and property-casualty. According to Dale, activities at the site included underwriting, sales, claims processing and claims litigation, as well as administrative functions.

When the World Trade Center attacks occurred, a command center was “mobilized” at Kemper’s corporate headquarters in Long Grove, Ill. As the morning’s events unfolded and the buildings collapsed, says Dale, a team at the command center began calling the affected employees and their families to make sure they had safely escaped.

“We took a vow that no one was leaving [the command center] until everyone was accounted for,” Dale says. “We were done on Tuesday night [Sept. 11] by midnight.”

At the same time, Kemper began calling key equipment vendors for immediate delivery of 200 desktop computers and 150 laptops. The company also contacted telecommunications vendors. The vendors re-routed the trade center facility’s 800 numbers back to Long Grove. “There was not a lot of [telephone] interruption,” Dale says. “The 800 service was basically seamless.”

Meanwhile, there was the problem of restoring lost data. Kemper procured new servers for that purpose and located them in Long Grove, Dale says. Then the company began the process of recovering 70 gigabytes of business data and 30GB of e-mail. The process began early on Sept. 11. By 10:30 that night, the servers were “reconstructed” for e-mail. “By 4 a.m. the next morning, all the business data was recovered,” Dale says.

The next step was for Kemper to find space in its existing facilities in the New York and New Jersey area for the more than 200 employees who were displaced. By 10 a.m. Sept. 12, trucks in Illinois were packed with computers; 300 telephones; networking cards, ports, hubs and switches?all bound for the New York area.

Kemper also dispatched a team of 10 technicians to accompany the equipment on its 17-hour drive to New York to help with setup and configuration at the alternate work sites, Dale says.

By Friday Sept. 14, every displaced employee who needed a workstation had one. “The technicians stayed through the weekend to clear up any problems,” Dale says, adding that they were planning to return earlier this week aboard the company’s corporate jet.

Dale says Kemper is “aggressively looking for real estate in Manhattan” for its displaced employees.

Meanwhile, he says, “we feel proud of what we were able to pull off and how we were able to recover.” He adds that a grief counselor will be available for the technicians when they return.

Another carrier, The Hartford Insurance Group, Hartford, lost offices housing 320 employees, with no likely casualties. “I can’t say definitively, but I’m pretty sure we haven’t lost anyone,” says Sue Honeyman, a Hartford spokeswoman.

The Hartford had offices in 7 World Trade Center, a building near the twin towers that was evacuated following the attacks. The building collapsed a few hours after the towers collapsed. According to Honeyman, the company lost all of the servers, personal computers and office automation equipment at the site. She was unable to put a value on the lost hardware.

Honeyman says the company is “moving rapidly” to have its displaced employees “business functional” at other nearby sites.

The only operation housed in the 7 World Trade Center facility was Hartford Financial Products, Honeyman says. “We had a couple of floors in that building. It was the business we acquired from Reliance about a year ago.”

As for service interruptions, “I suspect no one was calling [for financial products] at that moment,” Honeyman says. “There was some loss of service, but it was readily and quickly picked up by other offices.”

Data from the collapsed facility was backed up at other sites, Honeyman adds. “Nothing critical has been lost, especially our critical financial data.” She notes that the company may have lost “a few e-mails,” but emphasizes that “we really haven’t stopped serving customers.”

Displaced workers have been reassigned to the nearby sites that are closest to their homes. The company is in the process of shipping PCs, printers and other equipment to the alternate work sites.

“We’re tired because of the tremendous effort involved,” Honeyman says. “Everyone’s been pulling together. People are strong when they have to be.”

Another with facilities near the attack site was the Prudential Insurance Company of America, Newark, N.J. According to Bill Friel, the company’s chief information officer, Prudential suffered no casualties and no direct damage to its offices, at 1 New York Plaza.

The damage to the surrounding area, however, made it difficult for employees who work at 1 New York Plaza to get to the office. As a result, says Friel, Prudential has had only a skeleton staff at 1 New York Plaza since the day of the attacks.

“It didn’t affect us greatly,” Friel says. Many of the operations normally handled by the New York site are now being managed at a Prudential IT command center in New Jersey. The biggest problem, he says, is that the batch processing that would normally take place is finding no files to send. The additional search time taken by the systems has slowed down the process, “so the system gets ready for the online updates cycle a little later than it would have.”

The attack area also sustained “bad damage” to telephone lines, cutting off many of Prudential’s local circuits, Friel says. The company has been working with telecommunications vendors to find alternate routings and to prioritize which circuits will be repaired first.

One of the companies most severely affected?in terms of missing employees?is Aon Corp., Chicago. While no company spokesman was available, 1 World Trade Center housed Aon employees from the insurance brokerage, human resource consulting, claims servicing, specialty operations, and accident, health and life insurance underwriting units, according to the Aon Web site.

Aon was able to re-route data traffic that flowed through the World Trade Center within one hour, the site notes. “Other critical business processing systems were recovered and relocated, outside New York, within 24 hours,” the company says. “Policy consulting and other client-related information is being recovered, principally through our own systems but also through outstanding cooperation from carriers and clients.”

Aon notes that its financial records and systems are “fully intact,” but it adds that “other electronic data, principally?e-mail and hard copy documents that were not electronically imaged may be less recoverable.”

Still, says the Aon site, “all of Aon’s normal processing systems are up and running.”

The Aon site reports that the company is working to establish new office space in midtown Manhattan for displaced employees. Some of those employees have already been temporarily assigned to other Aon offices in the New York area.


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