Risk Management: Does Marsh Ltd Insure Against a “Sex Scandal” Risk?

Marsh Ltd, an global insurance company, has been in the news recently for a sex scandal involving its New Zealand employees. Do Marsh’s risk management solutions cover sex scandals?

Two employees having sex in the the Marsh ltd office in Christchurch were seen and filmed by patrons of the nearby Carlton Bar and Eatery.

An office romp in Marsh ltd. Christchurch branch that was witnessed and filmed by patrons of nearby Carlton Bar and Eatery
It started with a kiss. An office romp in Marsh ltd. Christchurch branch that the whole world saw. Image from dailymail.co.uk


Companies face different kinds of risks. This is why risk management is so important.

Marsh new zealand logo
Image via newzealand.marsh.com


This is how Marsh ltd describes itself in its website:

“Marsh is a global leader in insurance broking and risk management. Marsh helps clients succeed by defining, designing, and delivering innovative industry-specific solutions that help them effectively manage risk.”

This is what Marsh ltd has to say about its risk management solutions for Professional Services – an industry where Marsh belongs:

“Characterised by high client and regulatory expectations and a more litigious culture, the financial and professional service sector is one of the most exposed industries to liability risk. The Financial & Professional Risk Practice of Marsh (Finpro) specialises in liability risk and insurance solutions for professional, financial, technology and credit related risks.”

These are Marsh’s specific risk management solutions for professional services:

  • Business Assets Insurance
  • Business Continuity
  • Business Interruption
  • Cyber and Privacy attacks
  • Directors’ and Officers’ Liability
  • Employers’ Liability
  • Employment Practices Liability
  • Material Damage
  • Professional Indemnity
  • Prospectus Liability
  • Public and Products Liability
  • Statutory Liability
  • Trustees’ Liability

I checked each risk management solution that Marsh ltd offers for financial services and these are the ones that may be applicable to the office sex scandal in New Zealand:

  • Business Continuity – The media attention from the sex scandal somehow provides a disruptive environment for the employees in Christchurch. As has been reported, high ranking global executives of Marsh ltd are flying in to New Zealand to deal with the crisis, therefore taking their focus away from other business related matters.
  • Cyber and Privacy Attacks – Though the computer systems of Marsh had not been breached, some claim that the privacy of the two Marsh employees had been violated. The scandal involved the uploading of the video of the scandal on various social media platforms such as Twitter, Facebook, and Reddit so somehow there is cyber involvement here. However, the privacy commissioner in New Zealand had opined that the couple may not be able to sue for a privacy breach.
  • Professional Imdemnity – Though it is not clear whether the two employees were involved in directly providing financial advice to clients, a disgruntled client who dealt with any of the two might take advantage of the situation.
  • Employment Practices Liability – There are rumors that the two employees may be fired. If the employees feel that their dismissal is unreasonable, they might file suits against Marsh. The man involved is reported to have been married with children while the woman is engaged (update: the engagement was called off months ago, according to the rumored fiance). I am overreaching here, but can the other parties file suit against Marsh for providing an environment that fosters infidelity? The man involved is reported to be a senior executive while the woman is reported to be a secretary. Were any company sexual harassment policies breached with this scandal?
  • Statutory Liability – This risk management solution is protection against intentional or unintentional breaches of any New Zealand statute. These are statutes against public indecency though based on reports, it is not yet clear whether the two employees broke any local laws.


Carlton Bar and Eatery in Christchurch, New Zealand.
The bar that saw everything! Carlton Bar and Eatery in Christchurch, New Zealand. Image taken in 2013 by Michael Chun


Patrons of the nearby Carlton bar and Eatery watched and took videos of the office romp. This is what one of the witnesses had to say:

“They had absolutely no idea – it was brilliant. We went upstairs and watched from the balcony, and everyone was cheering — especially when he dropped her on the floor – twice. Everyone just lost it… They turned and faced the window and everyone was cheering and waving but they obviously couldn’t see us. It was pretty funny, a bit of a show for the night. Everyone was pretty impressed with how long he lasted. He went for ages.”

He dropped her on the floor? Ouch! I hope they have insurance for that.


– Finance MD






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Finance, M.D.

Finance, M.D. is a practicing physician who dabbles in finance and investment. He has passed all three levels of the Chartered Financial Analyst (CFA) exams, all in his first attempts. thefinancemd.com

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