Nat Parks Service Backs Down Again On Whitewater Insurance Requirements

Source: sadlersports.com - Nat Parks Service Backs Down Again On Whitewater Insurance Requirements
Author: John Sadler

  

As was reported in a prior blog posting, new National Parks Outfitters & Guides Insurance Requirements , the National Parks Service increased the General Liability insurance limit requirements for rafting companies in Grand Teton National Park from $500,000 to $5,000,000. Due to an outcry from industry participants, the National Parks Service later backed off this position and dropped the required limits to $2,000,000.

Now, due to a similar outcry from small outfitters & guides and insurance experts, the National Parks Service has suspended its plans to increase the aggregate liability insurance limit to $5 million for whitewater boating outfitters in Dinosaur National Monument. In addition, they have backed off their requirement to carry pollution coverage. In protest, Whitewater outfitters and guides claimed that the higher limits would raise premiums by 60-80% and that pollution coverage was not warranted.

Source: Park Service Backs Off Recreation Insurance Hikes in Colorado

Read Full Story: http://www.sadlersports.com/blog/nat-parks-service-backs-whitewater-insurance-requirements/

Should Youth Football Leagues Allow Add On Helmet Products?

Source: sadlersports.com - Should Youth Football Leagues Allow Add On Helmet Products?
Author: John Sadler

Do Add On Devices Actually Work?

Many youth football teams / leagues are currently using or are considering some new products on the market that will modify their existing football helmets with add on “enhancement devices” including external soft covers such as The Guardian, Shockstrip, or ProCap; internal shock reducers; and shock sensors to help to identify concussion candidates. The helmet manufacturers, primarily the big three, Riddell, Rawlings, and Schutt, either do not recommend the use of these products or have concerns about their use for various reasons. Many of my youth football insurance clients have asked for my advice on this matter from a risk management perspective. This is a complicated issue that has many elements that need to be considered. I will provide my thoughts based on the current information at hand. Please note that this situation is fluid with new developments and statement releases by NOCSAE and governing bodies occurring frequently.

Before getting into the risk management implications, I would first like to state that I don’t know whether some of these add on products provide effective concussion protection or not. Each side has its own argument that is backed by its own logic and research. The helmet manufacturers state that they are constantly researching new ways to increase concussion protection and have already incorporated all presently proven materials and designs into their existing models. The helmet manufacturers are very wary of liability concerns as they could easily be forced into bankruptcy by adverse jury verdicts or by not being able to afford liability premiums. As a result, they must strictly follow all protocols and standards as regards the law of product liability to preserve their defenses. This requires them to be conservative and risk adverse as regards new and unproven ideas and products.

On the other hand, the manufacturers of add on products are primarily start ups that are trying to rapidly gain market share with innovative new ideas as regards materials and designs. They are being fueled by the current hysteria over the concussion problem in football and the rush to find a solution to “save the game”. The add on device manufacturers allege that the big helmet manufacturers are trying to keep them from gaining a foothold by frightening the public as regards the safety of their devices and by unduly influencing NOCSAE, The NFL, and other industry associations to do the same. See recent article entitled “Helmets Preventing Concussions Seen Quashed By NFL”.

The add on manufacturers and many safety proponents are concerned that the liability roadblocks thrown up by the helmet manufacturers and NOCSAE are hurting the development of player safety. They point out that from a historical perspective, the independent research and creativity of smaller companies has benefitted society with innovative solutions to problems that were thought to be insurmountable and as a result they should not be stifled. Furthermore, they state that it is the players and parents who should make the decisions about the use of add on products.

Regardless of which side is correct in this debate (only time and additional research will tell), the following legal and risk management issues are of current importance in a youth football league’s decision about the use of these add on devices: voiding the manufacturer’s warranty, voiding NOCSAE certification standard, failure to follow rules or standards of governing or sanctioning body, and the law of product liability.

Voiding the Manufacturer’s Warranty

The typical youth football helmet manufacturer’s warranty asserts that the helmet shell and component parts will be free of defects in materials and workmanship for a period ranging from one to three years depending on the manufacturer. Some manufacturers allow the warranty to be extended if the helmet is reconditioned and recertified to NOCSAE standards every 1 – 2 years. The warranties are subject to a list of voiding factors such as failure to recondition / recertify every 1 – 2 years, inserting used replacement liners, use of a faceguard or internal or external device not approved by the manufacturer, use of chemicals which may have damaged the shell, excessive drilling, abuse of helmet or unintended use, and removal of the warranty label. Products that are defective under the warranty can be returned to the manufacturer for replacement. The warranties disclaim all liability for consequential damage arising from use of the products.

The helmet manufacturers make a big deal out of voiding their warranty as a reason not to use a third party enhancement device.

On the other hand, the add on manufacturers state that this is not a big deal since the main purpose of the warranty is to replace a broken shell and this happens rarely. Furthermore, some of the add on product manufacturers offer their own helmet warranty in the event that the helmet manufacturer does not honor their own warranty. Another issue is does the use of an add on actually void the manufacturer’s warranty? It depends on the exact wording in the warranty and the nature of the add on device. For some add on products, it is almost inconceivable how their product could damage the helmet shell. One large helmet manufacturer states that they will decide these warranty matters on a case by case basis.

It is my opinion that voiding the manufacturer’s warranty is not a big deal for the following reasons: 1) the financial consequences are not severe because the warranty merely guarantees replacement of the defective helmet part ($100 to $400 max for entire helmet) and has nothing to do with liability arising from player injury, and 2) many add on product manufacturers provide their own helmet warranty.

Voiding NOCSAE Certification

NOCSAE is a not for profit corporation that was formed in 1969 to develop a performance standard for football helmets. The NOCSAE board of directors consists of representatives from associations in the fields of medicine, athletic training, athletic equipment, sporting goods manufacturers, and high school / college. Evidently, the majority of NOCSAE’s operating income comes from the sporting goods manufacturers and NOCSAE is very conscious of limiting the liability of the manufacturers in addition to promoting the interests of player safety. Their standards are adopted by governing bodies such as NCAA and NFHS.

The NOCSAE football helmet test involves mounting a football helmet (with facemask removed) on a dummy head and dropping it 16 times onto a firm rubber pad under varying distances, contact points, and temperatures. Shock measurements are taken to verify that the helmet meets a severity index for concussion tolerance and if so, the helmet meets the NOCSAE standard. The testing is conducted by the manufacturers prior to the sale of the helmet and by licensed reconditioners thereafter. Newly manufactured helmets which pass the test must bear the seal, “Meets NOCSAE standards” which must be permanently branded on the outside rear of the helmet. Reconditioned helmets which pass the recertification must bear the following NOCSAE seal inside the helmet “This helmet has been RECERTIFIED according to the procedures established to meet the NOCSAE STANDARD”.  It is important to understand that the NOCSAE standard is not a warranty, it simply means that a particular helmet met the standard requirements when it was manufactured or reconditioned.

NOCSAE does not require a helmet to be recertified on a regular basis but recommends that teams/leagues adopt a program of inspection and reconditioning that meets the needs of such team/league based on a number of factors such as age of players, age of equipment, and usage. NOCSAE does not mandate reconditioning or recertification but manufacturers may restrict their warranty based on these factors. Any change or modification to the shell or liner from the original manufacturing specifications could alter the performance of the helmet and its performance under the NOCSAE test since the NOCSAE test is based upon the configuration of the helmet when it was manufactured without any modification or alteration. However, replacement parts are acceptable if they meet or exceed original manufacturer specifications. The NOCSAE helmet standard does not include the testing of helmets with facemasks as they are separately tested. NOCSAE suggests that the original manufacturer be contacted before any materials are applied such as, but not limited to, thinners, paint, wax, solvents, vinyl tape designs, cleaning agents, etc.

NOCASE’S July 16, Press Release After Market Products Void The NOCSAE Standard

“The addition of after-market items by anyone that changes or alters the protective system by adding or deleting protective padding to the inside or outside of the helmet, or which changes or alters the geometry of the shell or adds mass to the helmet, whether temporary or permanent, voids the certification of compliance with the NOCSAE standard.”

This ruling likely prompted the Colorado High School Activities Association (CHSAA) to prohibit the use of add on products during games.

NOCSAE’s August 7, 2013 Clarification Press Release States Helmet Manufacturers Decide If NOCSAE Standard Voided

In a change of position likely due to pressure from third party manufacturers and safety proponents, NOCSAE modified and relaxed it original July 16 statement to allow the original helmet manufacturer to decide if an add on product voids the original certification. This new statement also allows the helmet manufacturer to unofficially test the results of its helmet with the add on device. This statement also makes exceptions for items that are not attached or incorporated (see text below).  

Here are some highlights of the August 7, 2013 NOCSAE statement:

The addition of an item(s) to a helmet previously certified without those item(s) creates a new untested model. Whether the add-on product changes the performance or not, the helmet model with the add-on product is no longer “identical in every aspect” to the one originally certified by the manufacturer.

When this happens, the manufacturer which made the original certification has the right, under the NOCSAE standards, to declare its certification void. It also can decide to engage in additional certification testing of the new model and certify the new model with the add-on product, but it is not required to do so.

Companies which make add-on products for football helmets have the right to make their own certification of compliance with the NOCSAE standards on a helmet model, but when that is done, the certification and responsibility for the helmet/third-party product combination would become theirs, (not the helmet manufacturer). That certification would be subject to the same obligations applicable to the original helmet manufacturer regarding certification testing, quality control and quality assurance and licensure with NOCSAE.

Products such as skull caps, headbands, mouth guards, ear inserts or other items that are not attached or incorporated in some way into the helmet are not the types of products that create a new model as defined in the NOCSAE standards and are not items which change the model definition.” (Note: This is not the official position of NOCSAE or any helmet manufacturer but a leading concussion blogger speculates that the exception applies to MC10/Reebok Checklight and Guardian Cap.)

See April 2013 statement from National Athletic Equipment Reconditioners Association (NAERA) as regards the removal of aftermarket enhancements and related complications during the recertification process: 

Based on the latest NOCSAE clarification, the helmet manufacturer has the right to void the original NOCSAE certification for a particular add on product. This being the case, there is legal risk in allowing the use of an add on device on a helmet in a youth football program if an injury and lawsuit results where the helmet manufacturer takes the position that it voided the NOCSAE certification due to the add on  product.

Violation Of Governing / Sanctioning Body Mandates

Do the use of these add on devices violate the rules of the various governing / sanctioning bodies such as NFHS, American Youth Football, Pop Warner, USA Football?

Most youth football leagues follow the rules of their state version of the NFHS rules and regulations.

The NFHS has not disallowed the use of certain external enhancement devices per their Rules Review Committee Statement, August 2012.  Here is the critical element of their opinion: “In the absence of a clear answer to the “net impact on protection” issue, the decision as to whether to use or not use helmet attachments remains, at the high school level and all other levels, within the discretion of the various teams, coaches, athletes and parents.”

However, as a result of the latest August 7, 2013 NOCSAE clarification, the NFHS may be pressured to reconsider its position and to disallow an add on product should a helmet manufacturer declare that its use voids the original helmet certification.

The NFHS rules can be amended by the various state member associations. For example, the Colorado High School Activities Association (CHSAA) recently prohibited the use of these products during games but not during practice.

It is always safest from a liability perspective to follow the rules of the governing / sanctioning body. Failure to do so will certainly be used against a team or league in a court of law and can be a strong indication of negligence.

Use Of Add On Products Trigger Legal Defenses For Helmet Manufacturers

In the event of a serious head or neck injury, the plaintiff’s attorney will likely sue the helmet manufacturer/ distributor; add on product manufacturer / distributor; team / league; individual administrators; coaches, managers, trainers, and referees; and possibly the sanctioning body organization. Each will likely point the finger at the other defendants and will plead all the legal defenses that are available such as the absence of negligence, the other defendants were negligent, assumption of risk, waiver / release, etc.

What does product liability case law say about the legal defenses that are available to helmet manufacturers that may be triggered by the unauthorized use of add on products? Here is a list of such defenses:

• Improper Use Defense — Helmet was not used in manner intended by helmet manufacturer when plaintiff (injured party) was injured.


• Product Labeling And Directions Defense – The plaintiff or other responsible parties (parent, team, league, etc.) ignored the written warnings, directions, and risks that were communicated in helmet manufacturer’s materials.


• Altered Product Defense – The helmet manufacturer is not responsible for plaintiff’s damages if the plaintiff or other party altered the product once it left the helmet manufacturer’s control and furthermore the alterations caused the plaintiff’s injury rather than the original unaltered helmet.

Should Players, Parents, Teams, and Leagues Use Add On Products Due To Concussion Concerns?

Based on the analysis above, from a legal and risk management perspective, it is safest to follow the recommendations of the helmet manufacturers as regards the use of add on products. If you follow their recommendations, they will be the deepest pocket in the event of a catastrophic head or neck injury in your program. The major helmet manufacturers likely carry a combined General Liability / Excess Liability insurance limit in the range of $10M to $25M. On the other hand, the add on product manufacturers likely carry much lower limits of liability insurance due to their restricted start up budgets.

However, if your sports program is going provide or allow the use of add ons that are declared by the original helmet manufacturer to void the NOCSAE certification, despite the liability risks of doing so, it is recommended that your program carry its own General Liability / Excess Liability policy with combined each occurrence limits of at least $5,000,000 such as the insurance program provided by American Youth Football. In addition, the requirement that players and parents sign an appropriately worded waiver / release agreement that specifically warns of the dangers of violating the manufacturer’s instructions as regards add on products should be considered.  

Additional research may vindicate many of the add on product manufacturers to the point where public demand will force the major helmet manufacturers to accept their products if they are proven to promote safety.

Read Full Story: http://www.sadlersports.com/blog/youth-football-leagues-add-helmet-products/

Use Of Add On Products Trigger Legal Defenses For Helmet Manufacturers

Source: sadlersports.com - Use Of Add On Products Trigger Legal Defenses For Helmet Manufacturers
Author: John Sadler

In the event of a serious head or neck injury, the plaintiff’s attorney will likely sue the helmet manufacturer/ distributor; add on product manufacturer / distributor; team / league; individual administrators; coaches, managers, trainers, and referees; and possibly the sanctioning body organization. Each will likely point the finger at the other defendants and will plead all the legal defenses that are available such as the absence of negligence, the other defendants were negligent, assumption of risk, waiver / release, etc.

What does product liability case law say about the legal defenses that are available to helmet manufacturers that may be triggered by the unauthorized use of add on products? Here is a list of such defenses:

• Improper Use Defense — Helmet was not used in manner intended by helmet manufacturer when plaintiff (injured party) was injured.


• Product Labeling And Directions Defense – The plaintiff or other responsible parties (parent, team, league, etc.) ignored the written warnings, directions, and risks that were communicated in helmet manufacturer’s materials.


• Altered Product Defense – The helmet manufacturer is not responsible for plaintiff’s damages if the plaintiff or other party altered the product once it left the helmet manufacturer’s control and furthermore the alterations caused the plaintiff’s injury rather than the original unaltered helmet.

Should Players, Parents, Teams, and Leagues Use Add On Products Due To Concussion Concerns?

Based on the analysis above, from a legal and risk management perspective, it is safest to follow the recommendations of the helmet manufacturers as regards the use of add on products. If you follow their recommendations, they will be the deepest pocket in the event of a catastrophic head or neck injury in your program. The major helmet manufacturers likely carry a combined General Liability / Excess Liability insurance limit in the range of $10M to $25M. On the other hand, the add on product manufacturers likely carry much lower limits of liability insurance due to their restricted start up budgets.

However, if your sports program is going provide or allow the use of add ons that are declared by the original helmet manufacturer to void the NOCSAE certification, despite the liability risks of doing so, it is recommended that your program carry its own General Liability / Excess Liability policy with combined each occurrence limits of at least $5,000,000 such as the insurance program provided by American Youth Football. In addition, the requirement that players and parents sign an appropriately worded waiver / release agreement that specifically warns of the dangers of violating the manufacturer’s instructions as regards add on products should be considered.  

Additional research may vindicate many of the add on product manufacturers to the point where public demand will force the major helmet manufacturers to accept their products if they are proven to promote safety.

Read Full Story: http://www.sadlersports.com/blog/add-products-trigger-legal-defenses-helmet-manufacturers/

How Schools And School Districts Can Better Manage Facility User Insurance Requirements

Source: sadlersports.com - How Schools And School Districts Can Better Manage Facility User Insurance Requirements
Author: John Sadler

Sadler Sports & Recreation Insurance Partners With Schools / School Districts To Assist In Better Protection Against Liability And Reduction of Administration Hassles With Facility Users

Video explains critical aspects of facility user risk management: 

• Explains why facility user groups expose schools to huge liability potential.


• Why users such as camps, teams, leagues, special event operators, and tournaments must carry their own insurance.


• Why not just any insurance will adequately protect schools


• How to set reasonable minimum insurance standards to shield the school’s own liability insurance from paying unnecessary claims


• Provides a simple webpage that is a reputable source of high limit, high coverage sports insurance to which facility users can be referred to INSTANTLY bind coverage and issue certificates of insurance naming school as Additional Insured.


• How we can set up your school / school district on our automatic certificate of insurance issuance system to correctly issue the certificates to meet your special wording requirements every time. Nothing is more frustrating than having to tell a facility user that their insurance does not meet your requirements.


• All of the above speeds the process and reduces hassle and frustration on part of all parties.

 Click on picture to see video

Read Full Story: http://www.sadlersports.com/blog/schools-school-districts-manage-facility-user-insurance-requirements/

Concussion Rates Rising For MLB Catchers This Season

Source: sadlersports.com - Concussion Rates Rising For MLB Catchers This Season
Author: John Sadler

“At any given time there are somewhere between 60 and 75 catchers on MLB rosters and within the past 30 days around 15 percent of them have been on the disabled list specifically designed for concussions.”

Major League Baseball catchers are experiencing concussions at an alarming rate this season. At least one was caused by the accumulation of foul tips. I’m sure that MLB will be studying this trend carefully and will develop suggestions to better protect catchers.

Our injury statistics for youth baseball Accident claims don’t indicate a frequency problem in this area. Since we started tracking injuries in 1994, about three tenths of one percent of total injuries involved catchers suffering concussions and none were due to being hit in the mask by a foul tip.

Source: Catchers Are Suffering Concussions At An Alarming Rate

Read Full Story: http://www.sadlersports.com/blog/concussion-rates-risking-mlb-catchers-season/

How Much Can A Single Sex Abuse / Molestation Incident Cost?

Source: sadlersports.com - How Much Can A Single Sex Abuse / Molestation Incident Cost?
Author: John Sadler

Youth sports organizations should consider carrying a sufficient sex abuse / molestation limit (SAM) to cover these types of claims which can evidently reach $1.9M per claimant and higher as in the Sandusky case.

Penn State has just settled with its first claimant, victim 5, for an undisclosed amount but has set aside $60M to be spread between 31 claimants for an average settlement amount of $1.9M per claimant. Not including the amount set aside for settlements, Penn State has already spent $50M on attorneys fees, public relations, and other mitigation expenses.

No wonder the insurance carriers that insure youth sports organizations for sex abuse / molestation demand that risk management controls be put in place prior to offering coverage. Not only can the damages per claimant be very high, but also dozens of claimants can be victimized by a single predator. These controls typically involve running criminal background checks on all staff with access to youth, written policies and procedures to make an incident less likely to occur such as the use of buddy system where a single adult is never alone with a single unrelated child, and having a written incident response plan including a requirement to notify law enforcement.

Sadler Sports And Recreation Insurance provides its clients with a full array of free sex abuse / molestation risk management tools including training videos and word doc templates of written programs that can be adopted by a program. We offer versions ranging from one page to seven pages but all include the essential risk management controls.

Source: First Penn State Abuse Claim Settled, Lawyer Says; August 17, 2013; Associated Press

Read Full Story: http://www.sadlersports.com/blog/single-sex-abuse-molestation-incident-cost/

Soft Cover Football Helmet Add Ons Banned By CHSAA Over Liability

Source: sadlersports.com - Soft Cover Football Helmet Add Ons Banned By CHSAA Over Liability
Author: John Sadler

The Colorado High School Activities Association, CHSAA, ruled that the helmet shell called The Guardian Cap can’t be worn in games and that schools may void protection from helmet manufacturers’ warranties if they allow the use of such helmet shells during practices. Approximately 15 high school and youth teams in CO were using The Guardian Cap.

The National Operating Committee on Standards for Athletic Equipment (NOCSAE) issued a statement that read, in part: “The addition of after-market items by anyone that changes or alters the protective system by adding or deleting protective padding to the inside or outside of the helmet, or which changes or alters the geometry of the shell or adds mass to the helmet, whether temporary or permanent, voids the certification of compliance with the NOCSAE standard.”

When a youth football client asked my opinion on whether or not to experiment with the use of such helmet shell products in the face of concussion concerns, I provided the following response:

It is true that the attorney of a football player who suffers a serious brain or spinal injury (whether from single impact or repeated exposures) will sue all parties that could be remotely responsible including the helmet manufacturer, helmet distributor, helmet cover manufacturer, helmet cover distributor,  conference administrators, coaches, sanctioning body, etc. The helmet manufacturer would certainly argue that that it was not responsible for the injury due to the use of the helmet cover product which voided the manufacturer’s warranty. I’m not sure whether the helmet manufacturer could completely escape liability with such an argument. If they are successful in escaping liability, that leaves the General Liability insurance policies of the helmet cover manufacturer including any distributors and the conference. It’s likely that the helmet manufacturer carries a much higher liability limit than the other parties.

From a common sense point of view, it would seem that the additional padding and shock absorption would lessen the impact. On the other hand, the larger diameter and weight could increase rotational torque which could also impact concussions. But common sense is not always reality. For example, commotio cordis (sudden cardiac arrest due to arrhythmia) is an infrequent but usually fatal occurrence in youth baseball when a ball strikes the heart at the precise millisecond of the heart rhythm. It made common sense that youth players should use padding or a shield to protect against this risk and a number of products were introduced to provide such protection. But, one lab study with pigs being shot in the heart by baseball pitching machines showed that this type of protective device actually made a commotio cordis event more likely. It is best to leave the safety decisions up to the scientists. Of course, scientific progress can be slow and it can be difficult to determine if they have an agenda. Also, scientists can be wrong even if most are in agreement.

The safest play from a liability perspective is to go with the recommendations of your: 1) manufacturer, 2) NOCSAE, and 2) sanctioning / governing body if they have an opinion on the issue. There is always safety in siding with the recognized authorities; however, this does not mean that they are correct.

The manufacturers of soft helmet shell covers and other similar add on devices claim that the big helmet manufacturers are shutting them out of the process with their influence over the various sanctioning bodies and NOCSAE.  They point out that smaller companies have historically played an important role with scientific research, creativity, and problem solving. 

A future blog posting will take a more in depth look at a decision making rule that youth football leagues can follow when faced with decisions about third party add on products.

I would like to hear your thoughts on this issue.

Source: Guardian Cap: Controversial Ruling May Mean End To Use In Colorado; Adrian Dater; Denver Post; 8-1-13

Read Full Story: http://www.sadlersports.com/blog/football-shock-reduction-helmet-shell-banned-chsaa-due-liability-concerns/

Recreation Departments: Facility User Insurance Requirements

Source: sadlersports.com - Recreation Departments: Facility User Insurance Requirements
Author: John Sadler

Video Explains How Recreation Departments Can Reduce Liability Exposure And Administrative Hassles By Properly Collecting Certificates Of Insurance Every Time!

• Why facility user groups such as teams, leagues, tournament hosts, camps, instructors, and special event operators must carry adequate insurance.


• How to set minimum insurance limits and coverage standards that adequately protect the Rec. Dept.


• Get a simple free checklist tool to assist in verifying insurance compliance.


• Refer uninsured facility users to special web page where they can get instant quote,  instantly pay, and bind coverage that meets your specs without any delays or hassles. Otherwise, their delays and hassles become your delays and hassles.


• How we can set your Rec. Dept. up in our system so that the certificates of insurance meet your special wording requirements every time which cuts down on your frustration over certificates that don’t meet your requirements.

 Click on picture to see video

 

Read Full Story: http://www.sadlersports.com/blog/recreation-departments-facility-user-insurance-requirements/

Review Lease Of Premises Agreements For Sports / Recreation Associations

Source: sadlersports.com - Review Lease Of Premises Agreements For Sports / Recreation Associations
Author: John Sadler

• Most sports / recreation associations lease office space for the purpose of conducting their operations. These lease agreements contain numerous insurance and risk management considerations that must be addressed up front before entering into the lease or reviewed after the fact if the lease has already been entered into. It is customary for the landlord to require the tenant (association) to carry the following types of insurance policies to protect the interests of the landlord:

•   General Liability Insurance in the amount of $1,000,000 combined single limits to protect against bodily injury, property damage, personal injury, advertising injury, and damage to premises of others in the amount of $300,000. It is usually required that the landlord be named as “additional insured.”

•   Property Insurance may be required to be carried by the tenant to protect the replacement cost value of tenant’s improvements and betterments, contents, and sometimes building (in the event of a net lease) under the “special perils” coverage form. On occasion, it is required that earthquake and flood insurance be carried. Also, the tenant may be required to insure the glass against breakage and the heating, air conditioning, electrical, and plumbing systems against mechanical breakdown. If this is the case, the Property policy of the tenant must be endorsed to specifically provide coverage for glass and mechanical breakdown.

•   In the spirit of efficiency and reciprocity, most well-written leases should contain a “waiver of subrogation clause” whereby both parties agree that if their property insurance company pays the claim, that such insurance company will waive its subrogation (or lawsuit) rights against the other party in order to recoup the loss. Sadler & Company can provide the sample wording for this provision.

Most well-written leases will also contain an indemnification/hold harmless provision whereby each of the parties agrees to assume the liability and legal defense cost of the other party for lawsuits arising out of each party’s own negligence. In many cases, since the landlord is the party in power, this provision is often heavy-handed in their favor and should be negotiated on a more reasonable basis.

So why should you care if your lease contains insurance requirements that you’re not meeting or unreasonable contractual liability assumptions through hold-harmless/indemnification agreements? Of course, these considerations don’t matter until a problem arises, but it is too late to do anything about them after-the-fact.

Within minutes, Sadler & Sports Recreation insurance can review your lease agreement and make recommendations based upon your own unique situation. If you are interested in a no-obligation review, please call us at 800-622-7370.

Read Full Story: http://www.sadlersports.com/blog/review-lease-premises-agreements-sports-recreation-associations/

Simplifying Rental Vehicle Insurance For Sports & Recreation Organizations

Source: sadlersports.com - Simplifying Rental Vehicle Insurance For Sports & Recreation Organizations
Author: John Sadler

Many sports and recreation organizations enter into short term vehicle rentals while conducting their operations. The uses of rental vehicles includes flying into an airport and renting a vehicle to drive to a nearby meeting, transporting equipment to a tournament, and transporting athletic participants.

Due to complexities of rental car contracts and varying insurance policy coverage forms, it not an easy task to decide the best way to handle the insurance on these rentals. As a matter of fact, neither insurance carriers nor rental car companies offer a complete solution and many insurance experts are in disagreement over how to advise their clients. The choices are as follows:

• Buy Non Owned And Hired Auto Liability and Hired Car Physical Damage from your commercial insurance provider. (Typically costs $350 a year)


• Purchase the offering from the rental car company for both Liability and Collision Damage Waiver. (Typically costs $15 to $40 a day)


• Pay for the rental with a credit card and rely on the credit card rental car insurance benefit.


• Rely on your Personal Auto Policy.

Each of these choices has disadvantages for liability insurance (bodily injury to passengers or occupants of other cars or property damage to other cars) as follows:

• Non Owned And Hired Auto Liability under a commercial auto insurance policy may have an exclusion for the transportation of athletic participants or the use of 15 passenger vans. Of course, it is best to not get involved in either of these situations.


• A Personal Auto Policy may not provide coverage if the rental is for a business purpose.


• The Liability coverage offered by the rental car company may be voided if an unauthorized driver is driving the vehicle. An unauthorized driver is one who was not added to the list of authorized drives at the time of the rental. The rental car company will make a charge for each driver who is added to the list. Furthermore, the limits of liability that are offered may not be sufficient (ex: may only offer $250,000)

Each of these choices has disadvantages for physical damage insurance (damage to rental vehicle itself) as follows:

• Hired Car Physical Damage under a commercial auto insurance policy will only pay for the actual cash value (ACV) (deduction for depreciation) of the car if totaled, will not pay for diminution of resale value if not totaled, and will not pay for loss of profits while vehicle is out of fleet being repaired. Unfortunately, most rental car contracts through the national carriers require the following damages be paid: replacement cost (RC) value if the car is totaled, diminution of resale value if not totaled, and loss of profits while the vehicle is out of the fleet being repaired. Therefore, if the sports / rec organization relies on the Hired Car Physical damage, they would be out of pocket for these amounts.


• Comprehensive / Collision under a Personal Auto policy will have the same limitations as Hired Car Physical Damage.


• The credit card company will likely have the same limitations.


• The Collision Damage Waiver from the rental car company may void coverage if the damage to the vehicle occurs while an unauthorized driver is driving the vehicle, if a traffic violation is committed during the rental, if the driver is under the influence, or if the vehicle is being used off a paved road.

Suggested solution for the organization:

• An organization with rental exposures should always purchase Non Owned And Hired Auto Liability and Hired Car Physical Damage from its commercial auto insurance provider. These coverages will take care of the biggest exposure, auto liability, and will pay the lion’s share of any physical damage losses to the vehicle itself. However, understand that the organization could be forced to pay out of pocked for what is not covered.


• If the out of pocket exposure is a concern, such organizations should purchase the Collision Damage Waiver from the rental car company (but not the liability).


• Never use 15 passenger vans and avoid transporting participants if at all possible.

Every rental situation is unique and the insurance policy forms and rental car contracts vary, and as a result, organizations should review their options with their insurance agent prior to the rental.

Read Full Story: http://www.sadlersports.com/blog/simplifying-rental-vehicle-insurance-sports-recreation-organizations/

Membership Agreements And Rulebook Liability For Sports / Recreation Associations

Source: sadlersports.com - Membership Agreements And Rulebook Liability For Sports / Recreation Associations
Author: John Sadler

Membership agreements and rulebooks that are published by sports / recreation associations whether statewide, regional, or national in scope often result in liability issues between the association and its local members (ex: teams, leagues) that need to be addressed. As usual, attempts need to be made to transfer the risk of loss to the responsible party whenever feasible.

Most membership associations sanction or approve various competitions on a local level. The sanctioning rules and agreements are often specified in both the membership agreement and the rulebook. Whenever a spectator or a participant is injured at a local competition, it is common for the association to be “shot-gunned” into the lawsuit along with the local sports organization and its directors, officers, employees, and volunteers. The result is that the insurance carrier for the association is forced to spend money in defending the association in a lawsuit that it probably had no business being involved with. This could result in a less attractive loss history for the association and corresponding future rate increases or unavailability of coverage.

One of our clients, a national softball association, was actually “shot-gunned” into a lawsuit as a result of a coach assaulting an umpire during a local competition. The legal basis of recovery was that the coach was a hired employee of the association and as such they had a duty to investigate the criminal record of the coach before hiring. Presumably, had they done this, they would have uncovered incidences of violence and would have never hired the coach. Of course, this is absolutely preposterous as coaches of local leagues are almost never employees of the national association. Nevertheless, such an incident can result in the insurance carrier of the association spending $5,000 to $10,000 in legal defense costs to have the association removed from the lawsuit.

This trend of associations being “shot-gunned” into lawsuits where they have absolutely no “operational control” at the local level has resulted in the need for additional risk management precautions. As a result, we have developed specific language for our clients outlining what the national association is and is not responsible for based on “operational control.” If such a statement is placed in the membership agreement or the rulebook, we have found that it is relatively easy to convince the plaintiff’s attorney to immediately drop the association from the lawsuit.

Another consideration is that the best way to protect the association against liability is to make sure that adequate insurance is being carried by the local organizations and the tournament hosts. If feasible, it is best for the association to mandate minimum insurance requirements for both regular season and tournament competitions. The General Liability Policy of the local member should always name the association as an “additional insured.”

Please contact Sadler & Company at 800-622-7370 if you would like to have a “no obligation” consultation on the simple wording that can be inserted into your membership agreement or rulebook in order to help protect your association from being “shot-gunned” into lawsuits on a local level where you have no “operational control.”

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Approved Suppliers And Liability For Sports I Recreation Associations

Source: sadlersports.com - Approved Suppliers And Liability For Sports I Recreation Associations
Author: John Sadler

Sports / Recreation associations often enter into approved supplier agreements whereby an endorsement is given to the products or services of an approved supplier or vendor, often in exchange for a royalty or some other consideration. Typically, such contracts are entered into between an association and vendors such as sporting good manufacturers or distributors, soft drink or beverage manufacturers, insurance providers, website providers, fundraisers, trophy providers, picture providers, etc.

Any time that an association endorses a product or service, the association has a potential liability in the event that the product or service results in injury to a third party. Such injuries could take many forms including bodily injury, property damage, slander, libel, copyright infringement, trademark infringement, violation of constitutional or statutory rights, and other economic damages. The basic legal theory of recovery of the injured party against the association could be under either tort or contract law. Courts often say that an association owes a duty of reasonable care whenever it endorses a product or service and should do its homework in making sure that the product or service is not likely to result in injury or other damages.

For example, assume that a national baseball association endorses a particular manufacturer of a baseball bat in exchange for a royalty fee. It is conceivable that a pitcher may be injured by a batted ball and he could sue both the bat manufacturer and the association that endorsed such manufacturer. The potential legal theory of recovery against the association could be that it was aware of some studies that indicated that a “lively bat” exceeding certain specifications was more likely to result in serious injury to a pitcher or infielder. It could be stretched in a lawsuit that the endorsement of the product amounted to an endorsement of its safety. (A similar scenario actually occurred with Little League Baseball, Inc..)

In order to protect against such claims, all agreements with approved suppliers such as sporting goods manufacturers and distributors should contain indemnification and hold harmless provision in favor of the association. Furthermore, there should be a definitive statement that the association is in no way endorsing the safety of the product. A hold harmless or ademnification provision is generally worthless unless the approved supplier has a General Liability Policy including coverage for products/completed operations and contractual liability. The association should collect certificates of insurance from such approved suppliers evidencing that the appropriate coverages are in force on an annual basis. These minimum insurance requirements should also be outlined in the contract with the association being named as “additional insured” whenever possible.

Another example of a different type of injury would be when an association endorses an insurance agency or carrier to be its approved supplier of sports insurance. There have been some cases where an association endorsed a particular insurance carrier which became insolvent and was unable to pay its claims, and the association was sued for negligent endorsement of a product. The lawsuit would be based upon the resulting economic damages that would be incurred by the association members as a result of not having their claims paid.

For this reason, it is critical that associations closely monitor the financial strength of any insurance carrier that has been endorsed. The best way to monitor the financial strength of insurance carriers is through Best’s Key Rating Guide. As a general rule, it is preferable to never do business with a carrier that has a rating of less than A-. Please note that even A rated carriers can quickly become insolvent so it pays to be vigilant.

Another alternative to lessen liability for negligent endorsement is to consider an advertising agreement in lieu of a product or service endorsement. Advertising fee agreements can be structured in a number of different ways including sales based models.

 

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Treating Heat Stress In Athletes: Delay Could Be Fatal

Source: sadlersports.com - Treating Heat Stress In Athletes: Delay Could Be Fatal
Author: John Sadler

 

With pre season football practice well under way, numerous athletes will fall victim to heat exhaustion and heat stroke and some will even die. Most cases can be prevented by coach, parent, and player education and by following established guidelines. These guidelines include pre season physicals or medical clearance, proper hydration, heat acclimatization, equipment modification, activity modification, postponement / cancellation based upon wet bulb temperature index, and recognition / treatment. I was recently reading one of my favorite sports risk management publications, From Gym To Jury, and came across an excellent article that will be shared in the link below.

Source: Heat Stress And Athletic Participation, From Gym To Jury, Volume 24, No 2, Dr. Frederick Mueller

Read Full Story: http://www.sadlersports.com/blog/treating-heat-stress-athletes-delay-fatal/