September 15, 2020 • Athletic Administration

Athletic Organization Insurance: Considering the Options

{Sponsored} Preparing for any sports event comes with a long to-do list, and purchasing insurance can sometimes fall off the radar. However, signing up for coverage requires careful consideration and should never be a last-minute decision. Choosing a reliable insurance provider, deciding on the types and limits of coverage needed and completing the insurance applications are all steps in the process that will ultimately protect your organization should an incident occur.

There are many types of coverage needed for various entities involved in sports events. For example, teams and leagues should purchase insurance designed to protect the organization, including its employees and volunteers. When hosting a tournament, both the host organization and facility should have coverage. Often, the facility will require insurance.

What kind of insurance should I buy?

Defending your organization against and paying for liability claims can be expensive. Commercial liability insurance not only pays for damages you are held legally liable for, but should also cover the cost of investigation and defense of claims — even if they are groundless.

Sports organizations should look for Commercial General Liability coverage designed specifically for their needs. For example, if the younger brother of a player wanders onto the field before the game, climbs onto the soccer net, falls and is injured, liability insurance will respond. Or perhaps the grandmother of a participant trips over the team’s equipment, breaking her leg, and demands that the team pay for medical attention — again; liability insurance will protect the organization.

In addition to liability coverage, sports organizations also should consider inland marine coverage, sometimes called equipment and contents coverage. This provides coverage for direct loss or damage to sports equipment, field maintenance equipment, concession stand equipment and portable storage sheds.

Sports organizations may also be able to purchase other optional coverages such as hosted tournament coverage or directors’ & officers’ liability coverage. Depending on the size and activities of the organization, additional liability coverage and other insurance products such as property, commercial auto, crime and excess liability may be needed. Working with a licensed insurance professional is always the best option when making decisions regarding complex insurance coverages; an experienced provider will understand how various types of insurance interact to provide adequate coverage.

How much should I buy?

The policy “limit” is the dollar amount of protection purchased and that the organization will receive when there is a claim. For example, you may choose to buy a policy that offers a $2,000,000 occurrence limit with a $4,000,000 aggregate limit. This means that your limit for an individual incident is $2 millions with a total limit of $4 millions for all incidents occurring while the policy is in effect. Facilities or tournament hosts may mandate minimum limits, which can vary. Before purchasing coverage, be sure to check any contract or agreement you sign for insurance requirements.

What should I look for in an insurance provider?

When choosing an insurance provider, always ask about the financial stability of the carrier; a high rating (A or better) by an independent rating company such as A.M. Best Company is the safest choice. Also, choosing a carrier that is “admitted” (licensed) is preferable because choosing an insurance company that is non-admitted (called surplus lines) may require you to pay extra fees or taxes. Of course, experience is also a factor.

Purchasing the right type and amount of insurance will ultimately give you peace of mind when preparing for your next event. Choose the right liability coverage for your sports organization and you’ll be able to focus on other details, knowing that you’ve got the coverage you need.

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