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AGENTS & BROKERS ONLY |
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Other Sports & Recreation Insurance Programs |
Covered Activities Under Sports General Liability PoliciesGeneral Liability policies for sports and recreation organizations should cover the following activities that are adult supervised and sanctioned by the sports organization:
It is critical that coverage is included for non sport outings such as swimming parties, backyard cookouts, restaurant and ice cream celebration trips, etc. Some of the most serious injuries and largest lawsuits that I have witnessed over the past 20 years have come from non sport outings – particularly swimming parties.
Some General Liability policies that are deficient may restrict coverage to owned and leased premises that are scheduled on the policy. This could be a big problem if the sports organization has travel teams or if non sporting outings occur away from the premises.
Some General Liability policies include endorsements that restrict coverage to the time periods when officially sanctioned events take place. This is a big problem if a sports organization owns its field or facility or is responsible under the terms of a lease on a 24/7 basis.
Source: John Sadler
Copyright 2004-2009, Sadler and Company, Inc. All Rights Reserved
Named Insureds Under Sports General Liability PoliciesThe named insureds under the General Liability policy for a sports or recreation organization should include the legal entity itself and its directors, officers, managers, employees, and volunteers.
All of the above mentioned parties are covered by most late edition General Liability policy forms. However, many prior policy forms which are still in use neglect to add coverage for volunteers.
It is of critical importance to correctly list the name of the legal entity for the sports or recreation organization. For example, if the organization is incorporated or is a limited liability company, Inc. or LLC should appear in the name. In other words, the name should be listed exactly as the entity was chartered with the appropriate state governmental office. Failure to correctly list the name of the legal entity could possibly result in coverage denial based on a technicality.
Independent contractors that perform services for your sports organization and are paid on 1099′s are not covered under the standard policy forms unless specifically endorsed onto. However, the sports or recreation organization and other insured persons are covered if the negligent acts of the independent contractor results in a lawsuit against any named insured.
Source: John Sadler
Copyright 2004-2009, Sadler and Company, Inc. All Rights Reserved
Occurrence vs Claims Insurance Made For Sports OrganizationsOccurrence policy form is superior to claims made coverage under a General Liability policy for a sports or recreation organization such as a team, league, camp or recreation department.
Claims made coverage is far more complicated to administer as opposed to an occurrence coverage form for the following reasons:
When renewing a claims made policy, the agent must be careful to set the retroactive date back to the original inception date for the first claims made policy.
In the event that a claims made policy has been canceled or non renewed due to neglect, the retroactive date must be properly set upon renewal.
When changing from a claims made policy form to an occurrence policy form, “tail coverage” or an “Expended Reporting period” must be purchased so that coverage will remain in force for delayed reaction lawsuits that are filed for covered injuries that occurred during the claims made policy period(s) but that are not reported until after the last claims made policy has expired.
When a sports organization is going to shut down its operations, the same “tail coverage” or “Extended Reporting Period” must be purchased to protect the past administrators and volunteers against future delayed reaction lawsuits.
Sports organizations present the perfect opportunity for delayed reaction lawsuits that can be so dangerous under claims made policy forms. For example, a minor who is injured at age 5 can wait until the age of 18 plus 2 years for the statue of limitations to run, which is age 20 before filing a lawsuit. During this time span of 15 years, there is too great a chance that a technical mistake will be made under the claims made policy form which could void the coverage.
Always buy the occurrence policy form instead of the claims made policy form under General Liability for a sports or recreation organization.
Source: John Sadler
Copyright 2004-2009, Sadler and Company, Inc. All Rights Reserved
Sports Insurance For Sexual Abuse and MolestationPart Two
Insurance carriers that write General Liability insurance for sports and recreation organizations take two approaches to covering lawsuits alleging sexual abuse and molestation. Some carriers’ policy forms remain silent on the issue of coverage under the theory that it is covered if it is not excluded. This is usually true; however, some state case law may reach a contrary conclusion. However, most policy forms provide an affirmative grant of coverage for sexual abuse and molestation via a special endorsement.
For example, many carriers provide an endorsement that provides sex abuse and molestation coverage in the amount of $1,000,000 Each Occurrence and $1,000,000 Aggregate. Furthermore, the endorsement will usually include a laundry list of exclusions such as for the perpetrator himself, for remaining passive after an incident has come to the attention of management, etc.
Some policy forms may void sexual abuse and molestation coverage if the sports organization has not implemented a written procedure requiring a background check on all staff with access to youth.
In the event that a policyholder is a larger state, regional, or national organization with its own custom program, it needs to be verified whether the Sex Abuse and Molestation Aggregate applies to the entire program or separately to each individual named insured such as a league or club. Obviously, it is best if the Aggregate applies separately to each league or club.
Source: John Sadler
Copyright 2004-2009, Sadler and Company, Inc. All Rights Reserved
Hired Car Physical Damage Insurance For Sports OrganizationsSports organizations occasionally rent vehicles for officers to travel out of state on business and for the transportation of participants. If a Non Owned And Hired Auto Liability policy is in existence, it will not respond to damage to the rented vehicle itself. There are three options available for insuring damage to the rental vehicle:
1. Purchase Collision Damage Waiver from the rental car
company. This is the safest course of action to follow
as it will often pay for 100% of damages. The cost of
this coverage typically ranges from $15 to $30 a day.
2. Purchase Hired Car Physical Damage from the
insurance agent of the sports organization. Coverage
typically costs $250 per year. However, this policy will
not pay the following damages that are triggered by
many rental car contracts:
* The difference between Actual Cash Value and
Replacement Cost in the event the vehicle is
totaled.
* Loss of profits to the rental car company while the
vehicle is out of the fleet being repaired.
* Diminution in resale value
3. Rely on credit card benefits for physical damage. The
terms of credit card benefits vary greatly.
This is a complex area and consultation with an insurance professional is recommended prior to vehicle rental.
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
Sexual Abuse and Molestation Insurance For Sports OrganizationsPart One
Sexual abuse and molestation has been a huge issue in youth sports insurance over the past ten years. The sports insurance carriers that write General Liability have been decimated with a number of large settlements and adverse jury verdicts.
As a result, most carriers are not willing to extend coverage for abuse / molestation unless risk management controls are in place. In other cases, the coverage is only available by tapping into custom programs for larger governing and sanctioning bodies that have significant negotiating power.
Coverage for abuse / molestation is important because all directors and officers will be sued in addition to the alleged abuser. The directors and officers will be sued on the basis of failure to screen out staff with criminal backgrounds, failure to respond to an allegation, and failure to implement policies and procedures such as the use of a “buddy system” and a prohibition of overnight sleepovers whenever possible.
As a precondition of coverage, many insurance carriers will require mandatory background checks on all staff with access to youth as well as the adoption of a risk management awareness program.
For more information on the various types of background checks and the strengths and weaknesses of each: www.sadlersports.com/riskmanagement/
For more information on a simplified Abuse/Molestation Protection Program: www.sadlersports.com/riskmanagement/
Source: John Sadler
Copyright 2004-2009 Sadler & Company, Inc. All Rights Reserved
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