Leisure risks

Rough Notes, Sep 2000 by France, Larry

"Pay for play" facilities provide ample coverage opportunities

The economy is good, population is growing, disposable income is on the rise, and everybody likes to have fun. If you ever had to stand in line at an amusement park you will attest to the fact that "pay for play" facilities are busy places. This niche is varied in the type of risks that fall into it and programs that answer the coverage issues.

Classes that comprise the leisure industry entries are: amusement parks, amusement rides, animal rides, bowling centers, campground owners, canoe trips/river rafting, golf driving ranges, horse & carriage rides, hot air balloon rides, miniature golf, paint ball centers, tennis & racquetball centers, trail rides and water parks. The markets listed provide coverage for one or more of these risks. If you have questions consult our Web site (www.insurancemarketplace.com), click on the type of risk and your state. Available markets will be listed.

Overall, these classes of business contain several similarities. Financial status is very important. Pro formas and financial statements may be required and be an underwriting factor for acceptance. Especially true in the larger facilities is the need for established procedures regarding safety regulations, evacuation plans, and first aid administration. These should be in written form and, if possible, accompany your submission.

Most of the leisure classes also will contain exposures of the same nature. Snack bars, cooking facilities, and liquor exposures can be found in amusement parks, bowling centers, miniature golf, and tennis and racquetball centers.

Workers compensation is showing signs of firming in several geographical regions, not only in leisure risks but also in many classes of business. A few markets will write most of the "pay for play" workers compensation on a stand-alone basis. One of those is HPP Group. They specialize in monoline workers compensation for the leisure and nonprofit social organizations. According to Ralph Blust, senior vice president of High Performance Programs Group, they write in all states except monopolistic states. The minimum premium is $2,000. Coverage is written on a guaranteed cost basis. Blust states that the qualifications are three years in business, prior workers compensation coverage for three years, and maximum experience modification of 1.30. "We are seeing an unprecedented number of submissions in recent weeks," he comments.

Driving ranges should take precautions against having more than one party on the tees at a time. Proper spacing between drivers also can prevent injury to a nearby participant.

In preparing a submission for "pay for play" risk, diagrams, photos of signage, copies of employee manuals, and brochures will assist in the placement of your client.

Loss control measures play a big part in minimizing claims with leisure risks. Up-to-date equipment maintenance records will give an underwriter a good picture of the safety concerns that the organization has. In most states, a state inspector must inspect amusement park rides. Failure to do so can result in fines, closing of the park or possible civil or criminal prosecution. A client who is a member of a national industry association may be eligible for credits regarding the liability portion due to membership requirements.

Other considerations include audit or non-audited policies, policy aggregate provisions, bodily injury deductibles, and inclusion of volunteers where applicable. If your client has special promotions on the Fourth of July, for example, the general liability policy may not respond to special events or fireworks exposures.

Leisure prospects can be a good source of business for young agents. Most cities have bowling centers, tennis or racquetball centers, driving ranges and miniature golf courses. If they develop a good rapport with a market that can supply coverage and guidance in the "pay for play " arena, this could add to the agency revenue outside Main Street business. It also can add some excitement in prospecting.

The following markets have responded to our survey and have indicated that they are a market for at least one of the classes of leisure risks highlighted in this specialty feature.

BAT Insurance Corporation

465 S. Beverly Dr., Ste. 101

Beverly Hills, CA 90212

Contact: Tony Trocino

Phone: (310) 282-0753

Fax: (310) 282-7133

An E&S broker operating in CA offering limits of up to $10 million. Property and GL both are available. The A rated carrier is Westchester Fire.

Russell Bond & Company, Inc.

295 Main St., Ste. 866

Buffalo, NY 14203

Contact: Jeff Latke, Ext. 147;

Chris Moyer, Ext., 149; or Tony

Ambrose, Ext. 143

Phone: (800) 333-7226

Fax: (716) 856-0403

E-mail: info@russellbond.com

An MGA operating in NY offering limits of $2 million/$3 million and higher. Target markets are amusement rides (kiddy), campground owners, canoe trips, horse & carriage rides, miniature golf, driving ranges, and tennis & racquetball centers. GL, liquor liability, and excess liability are available. Various A rated carriers are utilized to place coverage.