Archive for the ‘Teams/Leagues’ Category

Insurance Discounts for NYSCA Coach Training

Team/Leagues can benefit from coach training and certification

Teams and leagues that train or certify their coaches through National Alliance for Youth Sports Coaches Association (NYSCA) qualify for a discounted team/league insurance program with specially negotiated coverage enhancements. The NYSCA Insurance Plan through Sadler Sports Insurance offers high limit, high quality Accident and General Liability coverages at discounted prices. The insurance carriers recognize that trained or certified coaches are less likely to have injuries or lawsuits and are willing to offer lower prices and coverage enhancements.

Qualifying sports include non-scholastic, youth (ages 18 and under) T-ball, baseball, softball, basketball, soccer, golf, swimming, tennis, track & field, volleyball, flag/touch football, cheer, ice hockey, roller hockey, ice ringette, lacrosse, and wrestling.

Some of the special coverage enhancements include $100,000 Excess Accident Limit, $2 million General Liability Limit, No General Aggregate Limit, Sex Abuse/Molestation Coverage, Non-Owned and Hired Auto Liability, and no-Volunteer v. Volunteer exclusion.

Optional coverages are available for Directors & Officers Liability, Crime, and Equipment.

What if your coaches are not currently trained by NYSCA? Getting set up for training is easier than you may think. The NYSCA clinics, available on-site or online, are not only going to take some of the work off of the organization that hosts the training, but also provide tried and true risk management techniques that will protect the organization, the coaches and the kids.  My suggestion would be to work this into your current coaches’ training, whether all at once or one sport at a time.

Visit the National Alliance for Youth Sports (NAYS) website to learn more. Click here to find detailed coverage descriptions, as well as the enrollment form to get your organization’s protection plan started.

Ownership and Management of Athletic Fields

An exclusion to avoid

It is clear that all sports and recreation organizations have liability for incidents that occur during scheduled, sanctioned and supervised activities such as tryouts, practices, and play.

However, some sports organizations that own or are long term lessees of athletic facilities are also legally responsible for injuries that occur on a 24/7 basis for 365 days a year. Ownership triggers the liability for premises owners. Lease agreements with hold harmless and indemnification provisions trigger the liability for long term lessees.

If your sports organization has 24/7 liability as described above, you should avoid the endorsement entitled “Ownership, Maintenance, Management of Athletic Fields or Facilities Exclusion” and any similar exclusion. As an alternative to removing this exclusion, some sports General Liability carriers allow a buy back that is commonly called “24 Hour Premises Liability.”

UGA Athlete Settles Insurance Dispute

Cornerback blames incomplete paperwork

Former cornerback Decory Bryant finally reached a settlement of $400,000 with the University of Georgia Athletic Association. UGA athlete settles injury caseA neck injury ended Bryant’s career in 2003.  The settlement was reached after an Athens-Clarke County judge dismissed the lawsuit that claimed the association failed to secure Bryant a $500,000 athlete disability insurance policy that would have paid him in the event he suffered a career-ending injury.

Ed Tolley, the association’s attorney, noted that the settlement was a sign that the athletic association was always committed to helping Bryant.

However, Bryant claimed that an official of the school failed to complete the paperwork for the $500,000 policy.


League Insurance Carrier Tries to Deny Injury Claim

Certificate of insurance was key in court ruling

A General Liability policy was taken out under the name of Northeast Youth Football League and its member teams. A certificate of insurance evidencing “additional insured” status was issued on behalf of a member team to the field owner as required by agreement. Another member team wanted to use the fields and the same certificate of insurance was submitted. A spectator was injured in a fall from a bleacher during a game played by the second team. Great American E&S Insurance Company denied the claim and sought a declaratory action for its responsibility to pay for the injury.

Certificate of INsurance

Sample Certificate of Insurance

Great American unsuccessfully argued that the certificate of insurance did not apply to the second team since its name was not listed on the certificate of insurance. The Supreme Court, Appellate Division, Third Department, New York disagreed by reasoning that neither the certificate of insurance nor the policy included the names of any of the teams, but instead listed only the league and its member teams.

Great American also argued that two separate policy exclusions would be applicable. The first was a Design Defect and Structural Maintenance Exclusion and the second was an exclusion stating that Additional Insureds were not covered for their sole negligence. However, the court reasoned that the latter exclusion could apply but said that the insurance carrier waived its right to use it as a defense since no written disclaimer was sent specifically mentioning their intent to use such exclusion.

In my opinion

Had the carrier given proper notice, it is likely that they could have properly denied the claim for the additional insured field owner, who was likely solely negligent in the slip and fall accident. The only way for the team to have shared in this negligence would have been due to lack of supervision or if the liability had been contractually assumed in a lease or license agreement.

Source: Rough Notes, February 2010

Collapse of Temporary Structure Exclusion

General Liability insurance policies for sports and recreation organizations sometimes contain a potentially dangerous “Collapse of Temporary Structure Exclusion.”

The purpose of this exclusion is presumably to protect the General Liability carrier against paying a claim in the event of collapse of bleachers, tents, signs, billboards, fences or other temporary structures.

Unfortunately, the exclusion does not define “temporary.” Does temporary refer to a one-time event? A season? A year? Are any bleachers that can be moved considered temporary?

A bleacher collapse can be a serious event in terms of both the number of spectators that can be injured and the potential severity of injuries. Because of the seriousness of these bleacher collapse incidents, sports organizations can’t afford to have this ambiguous exclusion on their General Liability policy.

Covered Activities Under Sports General Liability Policies

General Liability policies for sports and recreation organizations should cover the following activities that are supervised by adults and sanctioned by the sports organization:

  • Tryouts
  • Games
  • Practices
  • Tournament
  • Non-sport Outing

It is critical that coverage is included for non-sport outings such as swimming parties, backyard cookouts, trips to restaurants, 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.

Named Insureds Under Sports General Liability Policies

The named insureds under a sports organization’s General Liability policy 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 that 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 result in coverage denial based on a technicality.

Independent contractors who perform services for your sports organization and are paid on 1099s are not covered under the standard policy forms unless specifically endorsed. However, the sports or recreation organization and other insured persons are covered if the negligent acts of the independent contractor result in a lawsuit against any named insured.

Occurrence vs Claims-made Insurance for Sports Organizations

An occurrence 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.
  • If 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 extremely 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 statute of limitations to run out, which is age 20, before filing a lawsuit.  During this 15-year time span 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.


Sports Insurance for Sexual Abuse and Molestation

Check if you’re covered under General Liability

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 under the theory that it is covered if it is not excluded.  This is usually true, but some state case law may reach a contrary conclusion.  However, most policy forms provide an affirmative grant of coverage for sexual abuse and molestation through a special endorsement.

For example, many carriers provide an endorsement that provides sex abuse and molestation coverage in the amount of $1 million Each Occurrence and $1 million Aggregate.  Furthermore, the endorsement will usually include a laundry list of exclusions. An example of an exclusions would the perpetrator 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. program or separately to each individual named insured, such as a league or club.  It’s obviously best if the Aggregate applies separately to each league or club.

Hired Car Physical Damage Insurance

What is and isn’t covered

Sports organizations occasionally rent vehicles for transporting athletes to out-of-town games and tournaments or officers to travel out of state on business. If a Non-owned and Hired Auto Liability policy is in place, it will not respond to damage to the rented vehicle itself.

There are three options available for insuring damage to the rental vehicle:

  • 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 percent of the damages. The cost of this coverage typically ranges from $15 to $30 a day.
  • Purchase Hired Car Physical Damage from the sports organization’s insurance agent. Coverage typically costs $250 per year. However, this policy will not pay the following damages that are triggered by many rental car contracts:
  1.  The difference between actual cash value and replacement cost in the event the vehicle is totaled.
  2. Loss of profits to the rental car company while the vehicle is out of the fleet being repaired.
  3. Diminution in resale value.
  • 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.