Camp Insurance 101 - insuring a camp, and its activites

Camping Magazine, July, 2001 by Ian Garner

Understanding the fundamentals of a camp insurance program

Camp directors may not always be aware of all the exposures their businesses face. Working with children presents unmatched rewards, but also creates unique risks from the insurance perspective. While camp directors or owners should consult with qualified insurance professionals to determine the protection their facilities need, they don't have to be experts to understand the fundamentals of a good insurance program. The following short course describes the purpose and characteristics of a well-rounded insurance plan, giving you information about different types of coverage and the protection they can provide.

Lesson 1: Coverage

Insurance is available to cover many areas of your camp's operation.

Liability coverage

While good liability coverage is essential for every business, child-related businesses need specialized, high quality protection. Children's camps need coverage that reflects their unique risks, exposures, and operations.

General liability provides payment for sums you become legally obligated to pay because of damage to property of others or injuries to others that arise out of your negligence.

Umbrella liability offers extra liability insurance above your primary liability and auto policies. This coverage is designed to protect you and your assets in the event of a catastrophic accident.

Sexual abuse liability will protect you from allegations of sexual abuse due to negligence in your hiring, training, or supervisory practices. Defense costs should also be covered above the policy limit, which means that you will be able to defend your reputation vigorously against these damaging assertions.

Child abduction liability provides payment for reasonable and necessary expenses incurred by the camp and a child's parents following the abduction of a child from camp. Examples of covered expenses should include:

* fees and expenses of investigative services

* rewards leading to the recovery of the child

* public relations and publicity costs

* fees of independent forensic analysts

* travel expenses and salary lost by parents during the search for a child

* rest, rehabilitation, and psychiatric expenses for the child and immediate family members

* medical services and hospitalization for a recovered child

Key employee replacement coverage helps you get back to business as quickly as possible following the loss of a key staff member. The camping business is often a family affair, staffed by people who have made a lifelong commitment to their camp and the children in their care. When a facility experiences the death or incapacity of one of its key staff members, it can have a devastating effect on the camp's operations. Key employee replacement coverage can't ease the emotional effects of the situation, but it can help the camp get back to business as quickly as possible by providing the funds for a temporary replacement and to find and qualify a permanent replacement.

Directors' and officers' liability coverage provides individual protection for camp directors and officers against wrongful act lawsuits brought by customers, competitors, creditors, and others. Camp directors and officers make business decisions every day. However, if problems result from those decisions, the facility's general liability coverage may not protect these professionals. Courts continue to debate whether "detrimental management decisions" can cause injury as defined by most general liability policies. The professionals who manage a camp could find themselves defending their decisions in court.

Employment practices liability protects against the threats that employers face, such as allegations of sexual harassment, wrongful termination, and employment discrimination. In this day and age, this coverage has become more and more of a hot button for employers in all industries, especially in the social services realm.

Property coverage

Property coverage covers damage to buildings, personal property, equipment, and contents caused by specific perils, such as fire, lightning, explosions, windstorms and hail, smoke, aircraft or vehicles, vandalism, and more, as named in the policy.

Business income insurance covers the cost of normal business operations due to a forced shutdown of the facility. Fees lost from the unexpected shutdown of a camp because of property damage could put a significant strain on the financial resources of even the best-managed facility. The uninterrupted operation of facilities is a top priority for camp owners and that is why comprehensive and affordable property and business income coverage is so important.

Other types of coverage

Crime coverage protects you against the potential dishonest acts of your employees who handle checks, money, merchandise, or equipment at the facility or in your office, as well as theft or burglary of money or securities.

Boiler and machinery coverage can add protection for operations from sudden and accidental breakdowns of equipment typically excluded from property policies.