Presentation on theme: "EVENT INSURANCE By Ian Stack Action Entertainment Insurance"— Presentation transcript:
1EVENT INSURANCE By Ian Stack Action Entertainment Insurance (a Division of Action Insurance Brokers)
2TOPICS Types of Insurances Available to Event Organisers The Importance of Risk ManagementPublic Liability - Why is my premium so expensive?Tort ReformIndemnity Agreements - Be Careful What you SignBenefits of Using an Insurance Broker
3Types of Insurance Public/Products Liability Professional Indemnity Cancellation & AbandonmentWorkers CompensationEquipment Insurance
4Public/Products Liability SUMMARY OF COVER:To indemnify the Insured (Event Organiser) for their legal liabilityto compensate third parties (injured person/s) for personal injuryor damage to their property, where such personal injury orproperty damage arises from the Insured’s negligentactions.
5Principal Exclusions (summary) CLAIMS ARISING FROM:INJURY TO EMPLOYEES (WORKERS COMPENSATION)USE OF REGISTERED MOTOR VEHICLESUSE OF WATERCRAFT (LENGTH LIMITS APPLY)USE OF AIRCRAFTPROFESSIONAL NEGLIGENCECONTRACTUAL LIABILITY.
6Common Misconceptions THE VENUE HAS THEIR OWN LIABILITY INSURANCETHEREFORE I DON’T NEED TO TAKE OUT COVER.MY POLICY COVERS MY CONTRACTORS.I DON’T NEED COVER AS THE COMPANY THAT HASCONTRACTED ME TO ORGANISE THE EVENT HAS TAKENOUT INSURANCE ON THE EVENT.
7PROFESSIONAL INDEMNITY SUMMARY OF COVERCIVIL LIABILITY CLAIMS ARISING FROM THE CONDUCT OFINSURED’S PROFESSIONAL BUSINESS PRACTICE.BREACH OF PROFESSIONAL DUTYDEFAMATIONLOSS OF DOCUMENTSDISHONEST OR FRAUDULANT ACTS OF AN EMPLOYEEUNINTENTIONAL INFRINGEMENT OF COPYRIGHT LAWSSOME BREACHS OF THE TRADE PRACTISE ACT
8Principal Exclusion (Summary) PUBLIC/PRODUCTS LIABILITY CLAIMSCRIMINAL ACTS BY THE INSUREDOVER-RUNNING OF BUDGETPERSONAL INJURY OR PROPERTY DAMAGE CLAIMS
9Cancellation/Abandonment SUMMARY OF COVERCANCELLATION, ABANDONMENT, POSTPONEMENT ORINTERRUPTION OF EVENT CAUSED BY AN INSURED PERIL:DAMAGE TO VENUEDELAY IN TRANSPORT (vehicle breakdown, airline strike etc)ADVERSE WEATHER CONDITIONS (outdoor events)NON-APPEARANCE OF PERFORMER / GUEST SPEAKER
10Principal Exclusions (Summary) SHORT FALL IN ATTENDANCECANCELLATION DUE TO CONTRACTUAL PROBLEMSTERRORISM
11Workers Compensation COMPULSORY INSURANCE FOR ALL EMPLOYERS. MAY NEED TO TAKE OUT WORKERS COMPENSATION FOR SOME CONTRACTORS AND SUB-CONTRACTORS.POLICIES MAY BE REQUIRED IN EACH STATE OF AUSTRALIA.
12Equipment Insurance COVERS LOSS OR DAMAGE INCLUDING THEFT, FIRE, WEATHER PERILS, MALICIOUS DAMAGE AND TRANSITDAMAGE.RECOMMENDED IF YOU ARE HIRING OR BORROWINGEQUIPMENT FOR YOUR EVENT.
13RISK MANAGEMENTRISK is the chance of something happening that will have anadverse effect on the organisation or individual.RISK MANAGEMENT is the process of planning, organising,leading and controlling the activities of an organisation in orderto minimize the adverse effects of accidental losses on thatorganisation at reasonable cost.
15Risk Identification NEED TO ESTABLISH THE SERIOUSNESS OF THE PROBLEM. NEED TO ESTABLISH THE EFFECT THESE RISKS COULD HAVE ON THE ORGANISATION.PROCESS INVOLVES:- Interviewing management- Inspecting sites- Analysing flow charts- Reviewing past claims history
16Risk QuantificationMEASURING THE EXTENT OF THE PROBLEMS THAT COULD RESULT FROM A RISK HAPPENING.MEASURING LOSS FREQUENCIES AND LOSS SEVERITY.METHODS INCLUDE:- Statistical analysis- Review of layout of event site
17Risk AvoidanceDECIDE NOT TO PROCEED WITH THE EVENT TO ENSURE THE RISK WILL NOT OCCUR.ELIMINATE THE HAZARD CAUSING THE RISK.CONTRACT THE RESPONSIBILITIES OF THE RISK TO OTHERS.
18Risk Control IMPLEMENT PHYSICAL RISK CONTROL MEASURES: - Better fire protection- More security guards
20PUBLIC LIABILITY - Why is my Premium so Expensive MAJOR PRESSURES ON LIABILITY INSURANCE:ATTITUDE OF SOCIETY - If something happens, someone pays.CHANGES TO REGULATIONS COVERING LAWYERS - No Win, No Pay.COURTS & LEGISLATION - Joint & Several Liability.INCREASING NUMBER OF CLAIMS & CLAIMS COSTS - Between public liability claims increased from 55,000 to 88,000 - a 60% jump. Created a shortfall of $960 million.
21(Cont.)LIABILITY INSURANCE IS ‘LONG TAIL BUSINESS’ - In the combined insurers loss ratio was 42% and in six years this increased to 121%.PROLIFERATION OF HIGHER RISK RECREATIONAL ACTIVITIES - often undertaken by people who do not have the appropriate level of fitness for that activity.COLLAPSE OF HIH INSURANCE - had a large share of the liability market, reduced the financial capacity of the insurance industry to provide liability insurance.TERRORIST ATTACT - SEPT 11 - the biggest insurance payout in history. Increased insurance costs across the global market. Reduction in capital and increased premiums.
22(Cont.) INSURANCE TAXES - stamp duty, GST, Fire Service Levy. REDUCED INVESTMENT INCOME - Insurers are loosing money on their non-insurance investments and looking to their core business activities (insurance premiums) to raise revenue.LACK OF COMPETITION IN THE AUSTRALIAN MARKET - mergers of major insurers, withdrawal of international insurers from the Australian market, Australian Insurers withdrawing from writing certain classes of insurance.
23TORT REFORM NEW SOUTH WALES - Civil Liability Act 2002 Maximum amount of damages that may be awarded for non- economic loss is $350,000.Maximum costs that may be recovered for legal services on personal injury claims up to $100,000 are to be capped:- a plaintiff - fixed at the greater of 20% of the amount received or $10,000- a defendant - fixed at the greater of 20% of the amount sought by the plaintiff or $10,000
24(cont).Solicitors and Barristers are prohibited from providing legal services on a claim for damages unless they reasonably believe that the claim has reasonable prospect of success.A person does not owe an injured person a duty of care to warn of risks that a reasonable person would consider obvious.WaiversIntoxication - A court may only award damages to an intoxicated person for death, injury or property damage if the death, injury or property damage would have occurred if the person was not intoxicated. The intoxicated person is presumed to have been contributorily negligent to a degree of 25% or greater.
25(cont). Good Samaritan Volunteers Apologies Structure settlements Limitation periods
26INDEMNITY AGREEMENTSOTHERWISE KNOWN AS ‘HOLD HARMLESS’ CLAUSES OR CONTRACTUAL LIABILITY.DEFINITION - WHERE ONE PARTY ASSUMES THE LEGAL LIABILITY OF ANOTHER PARTY UNDER THE TERMS OF A CONTRACT (CONTRACTUAL LIABILITY).COMMONLY FOUND IN VENUE HIRE CONTRACTS, AGREEMENTS WITH COUNCILS OR GOVERNMENT INSTITUTIONS, EQUIPMENT HIRE AGREEMENTS.
27Indemnity Agreements & Their Effect of Public Liability Insurance CLAIMS ARISING FROM LIABILITY ASSUMED UNDER CONTRACT ARE EXCLUDED UNDER PUBLIC/PRODUCTS LIABILITY INSURANCE POLICIES.POLICIES CAN SOMETIMES BE ENDORSED TO NOTE SPECIFIC INDEMNITY AGREEMENTS, SUBJECT TO INSURER’S APPROVAL.LIABILITY CRISIS HAS MADE INDEMNITY AGREEMENTS ALMOST IMPOSSIBLE TO INSURE FOR - INSURERS DON’T LIKE COVERING OTHER PARTY’S NEGLIGENCE.
28Indemnity Agreements - Solution AVOID SIGNING THEM !IF UNABLE TO AVOID THEM, TALK TO YOUR INSURANCE BROKER ABOUT HAVING THEM NOTED ON YOUR POLICY.CONSIDER ‘INTERESTED PARTY’ ALTERNATIVE
29WHY USE AN INSURANCE BROKER ACTS AS AN AGENT FOR THE INSURED, NOT FOR THE INSURER.NOW SUBJECT TO THE NEW FINANCIAL SERVICES ACTS - strong focus on consumer protection.NOT ONLY ORGANISES INSURANCE BUT ADVISES YOU ON HOW TO MANAGE ALL OF YOUR RISKS, REDUCE EXPOSURES IN ORDER TO KEEP INSURANCE COSTS DOWN.SPECIALIST BROKERS FOR NICHE INDUSTRIES