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AGENTS & BROKERS ONLY |
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Other Sports & Recreation Insurance Programs |
Non Owned And Hired Auto Liability For Sports OrganizationsSports organizations need Non Owned and Hired Auto Liability to cover their liability arising out of the use of vehicles that are not titled to the sports organization.
A non owned auto is an auto that is not owned by the sports organization but is instead owned by an employee or volunteer who runs errands or transports participants at the direction of an authorized league official. Sports organizations benefit from the use of the non owned vehicles.
When these vehicles are involved in an accident where the passengers or other third parties are injured, the sports organization may be vicariously liable and can be shotgunned into these lawsuits as a deep pocket. Injured parties often seek out the sports organization as a deep pocket when the owner of the non owned vehicle is uninsured or underinsured for personal auto insurance.
Non owned Auto Liability covers the sports organization itself but does not normally cover the individual vehicle owner or driver. Individual vehicle owners or drivers must look towards their own Personal Auto Policy for coverage.
A hired auto is an auto that is borrowed (ex: church or school) or that is leased from a rental car company. Hired Auto Liability protects both the sports organization and driver from liability arising from an auto accident when a vehicle is borrowed or leased.
Non Owned and Hired Auto Liability can be obtained on either a Business Auto policy or a General Liability policy. However, the insurance carriers are reluctant to write these coverages for sports organizations due to the high severity potential and the fact that sports organizations typically don’t implement loss control protections. Basic loss control protections include driver screening by receiving acceptable Motor Vehicle Reports (MVRs) and by requiring employees to provide evidence that they carry a Personal Auto Policy with limits of at least $300,000 combined single limits.
In addition, many insurance carriers are reluctant to extend these coverages to the rental of 15 passenger vans due to their documented tip over propensity or for the transportation of participants. The actual policy language must be carefully reviewed for these restrictions.
It is important to note that Hired Auto Liability does not provide any coverage for damage to the rental vehicle itself. Another blog will address this topic.
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
Fire Damage Legal Liability Coverage for Sports OrganizationsFire Damage Legal Liability is a General Liability coverage that is important for sports organizations that lease or rent buildings from a landlord. This coverage is also known as “Damage To Premises.”
This coverage applies in the event that the sports organization’s negligence results in damage to rented premises, by fire or otherwise, and it is sued for damages.
Typical limits for Fire Damage Legal Liability are either $100,000 or $300,00 depending on the carrier.
In the event that the replacement cost value of the building that is leased exceeds the Fire Damage Legal Liability limit, you should either increase your limit or should attempt to negotiate a joint waiver of subrogation provisions to your lease agreement.
Under a joint waiver of subrogation provision, both the landlord and tenant (sports organization) agree that each will rely on their own property insurance to cover their respective property losses and that each will waive the subrogation rights of their property insurance carrier to recoup its claim payment loss via lawsuit against the negligent party who caused the loss.
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
Premises Medical Payments For Sports OrganizationsPremises Medical Payments (AKA Medical Expense) can be an important coverage for sports organizations to have on their General Liability policy. Normally, a General Liability policy does not respond unless there is a threat of a lawsuit; however, Premises Medical Payments allows the carrier’s claims department to respond and pay benefits without a threat of a lawsuit.
The purpose of Premises Medical Payments is to appease the injured party by quickly offering to pay their medical bills in an effort to convince them not to hire an attorney.
The normal policy limit for Premise Medical Payments is $5,000. In the event that damages exceed $5,000, the fallback position is to revert back to the Each Occurrence limit for bodily injury liability.
Premises Medical Payments is typically used for minor spectator injury claims. Most policy forms exclude Premises Medical Payment coverage for athletic activities which are defined as practicing, instructing, or participating in any physical exercises or games, sports, or athletic contests. However, this exclusion is not a problem since athletic activities should be covered by an Excess Accident policy.
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
Personal And Advertising Injury Exposures For Sports OrganizationsSports organizations such as teams, leagues, and recreation departments have definite personal and advertising injury exposures which should be covered under a General Liability policy.
Personal injury is defined as a certain types of slander, libel, invasion of privacy, and false imprisonment. A typical personal injury example in the sports context occurs when a slanderous statement is made about a coach, umpire, or parent arising out of the heat of competition.
Advertising injury is defined as certain misleading statements or infringement of intellectual property rights in advertisements. An example in the sports context would occur when a sport organization makes a misleading statement about a competing sports organization in its advertising materials in the recruitment of player registrations.
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
Each Occurrence Limit Under Sports General Liability PoliciesThe each occurrence limit under a General Liability policy for a sports or recreation organization such as a team, league, camp or recreation department should be at least $1,000,000 at a minimum. The limit is expressed as a combined single limit for both bodily injury and property damage liability.
The each occurrence limit is the amount of coverage that will apply to any one occurrence (incident or accident) even if it results in more than one lawsuit. For example, in a bleacher collapse incident involving multiple injuries and lawsuits, the entire $1,000,000 limit would be available to be split between all claimants.
Many facility and field owners now require facility users to provide evidence of a $2,000,000 Each Occurrence limit before they are allowed access. For this reason, a ports or recreation organization may want to consider carrying a $2,000,000 each occurrence limit. If this option is available, the additional cost is normally 20% of the underlying $1,000,000 limit.
If limits higher than $2,000,000 are needed, the best way to accomplish this is to request a quote for an Excess Liability policy which can be purchased in increments of $1,000,000. The minimum premium for each additional $1,000,000 increment will likely be in the $750 to $1,000 range. The actual premium may be higher than the minimum premium depending on the size of your exposure basis. (ex: number of participants or teams).
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
General Aggregate Limit For Sports General Liability PoliciesThe General Aggregate limit on a General Liability policy for a sports or recreation organization such as a team, league, camp, or recreation department describes the maximum amount that is available under the policy to pay multiple lawsuit occurrences during a one year policy period.
The General Aggregate applies to premises and operations types of lawsuits such as those arising from spectator and participant injuries.
The minimum acceptable limit for the General Aggregate is $2,000,000 or NONE per league. Having a General Aggregate of NONE provides the broadest coverage since NONE means that there is no General Aggregate cap. In other words, there is an unlimited amount of coverage available.
For example, if a sports organization’s Each Occurrence limit is $1,000,000 and their General Aggregate limit is $2,000,000, they will have enough General Aggregate limits to pay the following:
Once the General Aggregate has been breached by multiple lawsuit occurrences during the policy year, the policy will no longer respond.
Some larger local, state, regional, and national sports organizations have customized their own General Liability programs for their membership. If a large number of teams or leagues share the same General Aggregate limit, this can be a problem as there might not be enough General Aggregate limits available.
For example, I have seen national organizations with thousands of leagues that have shared a single General Aggregate limit of $2,000,000. If several leagues were to have claims during a single policy year that totaled $1,500,000, there would only be $500,000 in General Aggregate limits left for the rest of the leagues.
The solution is to endorse the policy to make the General Aggregate limit to apply separately to each insured league.
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
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