The risk of watching. (Spectator Liability: Property/Casualty).After years of dodging baseballs, hockey pucks and errant er·rant
1. Roving, especially in search of adventure: knights errant.
2. Straying from the proper course or standards: errant youngsters.
3. race cars, spectators are faced with a new threat-terrorism. Liability coverage has become expensive or unavailable for promoters, event organizers and venue owners.
In March, 13-year-old Brittanie Cecil Brittanie Nicole Cecil (born March 20, 1988 in Columbus, Ohio, died March 18, 2002) was a hockey fan who died from injuries suffered when a puck was deflected into the stands and struck her in the head at Nationwide Arena on March 16, 2002. was struck and killed by a hockey puck that flew into the stands during a National Hockey League National Hockey League (NHL)
Organization of professional North American ice-hockey teams. The league was formed in 1917 by five Canadian teams; the first U.S. team, the Boston Bruins, was added in 1924. It today consists of 30 teams in two conferences and six divisions. game in Columbus, Ohio Columbus is the capital and the largest city of the American state of Ohio. Named for explorer Christopher Columbus, the city was founded in 1812 at the confluence of the Scioto and Olentangy rivers, and assumed the functions of state capital in 1816. . This tragedy, and last year's terrorist attacks in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , brought national attention to the growing risk that spectators face at sports and entertainment events.
The total number of spectator deaths and injuries is unknown, but at least 29 spectators died and 70 were injured by race cars or flying car parts at U.S. auto racing events alone since 1999, according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. The Charlotte (N C.) Observer. In addition, spectators have been injured or killed by foul balls at baseball games or crashing planes at air shows--not to mention th dangers from thrashing thrashing: see threshing.
Excessive paging in a virtual memory computer. If programs are not written to run in a virtual memory environment, the operating system may spend excessive amounts of time swapping program pages in and out of the disk. about in mosh pits at rock concerts.
Although the number of spectators killed or injured is small in comparison with the millions of fans that pack stadiums and arenas each year, spectator liability coverage is a growing concern among promoters, event organizers and venue owners. And now, with the emerging threat of terrorism at sports and entertainment venues, insurers and reinsurers are taking a hard look at writing terror exclusions into spectator liability policies.
Need for Coverage
Any time spectators are present at an event, there is the potential for injury or death. Event organizers, promoters and facility owners are increasingly relying on the specialized coverage of spectator liability, which falls under general liability policies, to protect against such incidents.
"The assumption or perception is that once someone pays for a ticket, you then assume responsibility for that person, making sure they are protected from any harm during the event," said James Chippendale, president of Dallas-based entertainment insurance broker CSI CSI Crime Scene Investigator
CSI CompuServe, Inc.
CSI Commodity Systems, Inc.
CSI Commodity Systems Inc. (Boca Raton, FL)
CSI Crime Scene Investigation (CBS TV show)
CSI Christian Schools International Entertainment Insurance.
Liability exposures vary among events. Motor sports, including car racing, tractor pulls and motorcycle events, have experienced the largest number of spectator deaths among U.S. sporting events and generally have the highest liability exposure attached to them. In the entertainment industry, concert insurance is currently one of the most expensive forms of spectator liability.
In addition, newer stadium designs that bring seats closer to athletes are increasing spectator liability risks.
Spectator liability coverage differs across the globe. International restrictions for liability and cost of liability coverage are significantly less than in the United States, at only about 30% to 40% of the cost of U.S.-based risks, said Mike Price, president of ESIX ESIX Electrically Switched Ion Exchange , a sports- and entertainment-based insurance and risk-management services provider based in Atlanta.
Despite rising premiums and limited availability When customers of the PSTN make telephone calls, they commonly make use of a telecommunications network called a switched-circuit network. In a switched-circuit network, devices known as switches are used to connect the caller to the callee. of coverage, most insurers believe the demand for spectator liability will continue to grow. "It's something that never goes away," said Bill Frazier, president of Frazier Insurance, Richmond, Va. Even in tough economic times, Americans continue to go to baseball games, concerts and special events. "In effect, this is a recession-proof industry," he said.
U.S. sporting events, amusement parks This page contains a list of amusement parks by
"There is more evidence of stadiums, sporting facilities and teams being unable to get terrorism coverage than almost anything else," said Robert Hartwig, chief economist The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis. It is distinguished from the other economist positions by the broader scope of responsibility encompassing the for the Insurance Information Institute. National Football League teams reportedly without terror coverage include the New York Giants
The cost of commercial property insurance that covers terrorism has generally risen about 30% nationally, Hartwig said, noting that the cost for coverage of sports facilities See:
While some policies are now being renewed with terrorism exclusions, many are being offered with limited terrorism coverage, separately or as an endorsement with a specific sublimit sub·lim·it
A limit or ceiling placed on a subdivision of a larger category, especially of nuclear weapons: negotiating sublimits on the number of land-based, intermediate-range missiles. .
As a result, some sports franchises are either buying what they can get, even with limited amounts, or are deciding not to purchase coverage, citing cost as the factor, Hartwig said. "When a team or stadium says they couldn't get terrorism coverage, that doesn't necessarily mean they weren't offered it but instead may have just decided not to purchase it," he said.
Many insurers and reinsurers have begun writing terrorism exclusions into spectator liability coverages.
During the past several months, most states have approved the Insurance Services Office Insurance Services Office, Inc. (ISO) is a provider of data, underwriting, risk management and legal/regulatory services to property-casualty insurers and other clients. Headquartered in Jersey City, New Jersey, the organization serves clients with offices throughout the United Inc. wording for terrorism exclusions. Insurers that don't use the wording, or insurers in states where the wording has not been approved, generally offer smaller limits than would otherwise be available with the ISO (1) See ISO speed.
(2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI. wording, said Mike Larkin, senior vice president of Roanoke, Ind.-based American Specialty, which provides risk consulting and insurance services for the sports and entertainment industry. Larkin added that the ISO terrorism wording is becoming popular, if not the norm, on most spectator liability policies.
"Everyone ran for their exclusions, because most policies didn't have these protections prior to Sept. 11," said Frazier. In the past, liability policies commonly contained only war exclusions and covered terrorism-related claims that didn't fall under the definition of an act of war.
Now insurers are putting terrorism exclusions on liability and property policies and may be willing to delete those exclusions with additional underwriting information and additional premiums, said Lou Valentic, senior vice president, executive accounts, for K&K Insurance, Fort Wayne Fort Wayne, city (1990 pop. 173,072), seat of Allen co., NE Ind., where the St. Joseph and St. Marys rivers join to form the Maumee River; inc. 1840. It is the second largest city in the state, a major railroad and shipping point, a wholesale and distribution hub, , Ind.
A significant portion of Sept. 11-related losses went to reinsurers who accounted for less than 20% of the capital available in the marketplace. "Everyone had to quickly start getting cash flows to make up for losses, and as a result, the first thing they did was stop writing terrorism, because it was peril for which there is no known actuarial ac·tu·ar·y
n. pl. ac·tu·ar·ies
A statistician who computes insurance risks and premiums.
[Latin data upon which to base rates for the exposure," said Lowery low·er·y also lour·y
Overcast; threatening. Robinson, president of Duluth, Ga.-based Marketing Etc., a risk-consulting and marketing firm for the sports and entertainment industry. Because of the absence of such reserves, he said, some insurers are now addressing terrorism exclusions as a separate line of business, will develop some way of rating it and will begin building reserves just as they have in other lines of business.
"If purchasers of insurance have significant leverage, they will likely be able to negotiate a policy with fewer exclusions," said Steven Rosenfeld, a partner with Ohrenstein and Brown, a New York City New York City: see New York, city.
New York City
City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. law firm that represents insurers and brokers. "Conversely, if insurers have the leverage, they will be able to negotiate policies with more exclusions."
Several insurers recognized after Sept. 11 that policies didn't provide them with adequate safeguards with respect to terrorism, and claims are now being paid because there weren't exclusions written into policies. In the current market, insurers generally have the upper hand in negotiating terrorism exclusions with respect to large pieces of property, he said. Purchasers sometimes can minimize or remove exclusions, however, if arenas are willing to are willing to pay larger premiums or accept a large portion of the risk.
While some insurers believe most spectator events haven't been greatly affected by exclusions for terrorism and government shutdowns, these exclusions have had an effect on organizers of events in which large sums of money are used to get people to a venue. Promoters of these events are now trying to get a buyback provision to cover their expenses. U.S. carriers are not yet writing terrorism buybacks into policies.
Limited coverage amounts on spectator liability policies also are causing problems. "It used to be easy to get $30 million in coverage, but now just getting $5 million or $10 million is extremely difficult," said ESIX's Price.
"If you have excess, you're king, and if you don't, you're losing business," Frazier said.
Compared with the rest of the market, spectator liability rates have remained fairly consistent over the past year. However, some insurers anticipate small rate increases will stem from the increased demand for coverage, limited excess and re-evaluated reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. contracts.
In addition, businesses are faced with increased premiums resulting from general market conditions, as well as the addition of terrorism coverage. Surcharges from 40% to 200% of the liability and excess premiums for policies to include terrorism coverage are being seen across the country, said K&K's Valentic.
But not all companies and insurers are blaming terrorism coverage for the rise in premiums. The hardening market, which began even before Sept. 11, is also linked to rising prices and availability. For example, Frazier Insurance anticipates a 22% to 25% renewal rate increase in September for its general liability covers. Frazier believes the effects of Sept. 11 are far from over. He said reinsurers are still unclear what their total losses will be, because retrocessions continue to filter in from other sources, and the courts have yet to decide if the airplane attacks on the twin towers of the World Trade Center in New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of constitute one or two occurrences.
Some insurers believe the increased pricing effects will be felt across the industry for the next two to three years. "Insurers are likely to continue to raise rates for spectator liability coverage to levels that haven't been seen during the last decade" said Valentic.
Event cancellation policies, which protect against the cancellation, postponement, rescheduling or abandonment of an event, often go hand-in-hand with spectator liability coverages. Like many other coverages, however, these policies suffered a tremendous blow after Sept. 11, particularly among writers that took some substantial financial hits from the events.
As the demand for event cancellation protection continues to increase, its availability is becoming a hard-to-come-by commodity. "Prior to Sept. 11, event cancellation was very available at reasonable pricing," said Frazier. However, now many carriers aren't even offering the product, and where they are quoting it, terrorism and government shutdown endorsements are being added, he said.
"This is the area where we will see terrorism really come into play, with exclusions being included in these policies and premiums increasing pretty drastically," said CSI's Chippendale.
RELATED ARTICLE: Rising Premiums Cause Air-Show Cancellations
Higher insurance premiums are to blame for the cancellation of several Canadian air shows this year. The events of Sept. 11 have forced Canadian airports to ask air show operators to purchase expensive insurance coverage for use of airports.
Canadian airports are now required to obtain $50 million in general liability coverage per show site, as well as coverage for war and terrorism risks. Canadian airports have specifically requested that underwriters write into policies that air shows are required to pay premiums for general liability coverage and war and terrorism coverage during the period that air shows are held on their grounds.
"Premium quotes for the required $50 million U.S. coverage are in excess of $70,000, premiums that virtually no Canadian show will be able to pay," said John Cudahy John Clarence Cudahy (December 10, 1887 - September 6, 1943) was a real estate broker and American ambassador to Poland, Ireland, Belgium and Luxembourg. Early life , president of the International Council of Air Shows Inc., a Leesburg, Va.-based trade and professional association for the North American North American
named after North America.
North American blastomycosis
see North American blastomycosis.
North American cattle tick
see boophilusannulatus. air-show marketplace.
Premiums for that coverage are estimated at C$115,000 (US$73,588) per show site, Cudahy said. Previously, the most coverage any Canadian air show had obtained was C$20 million (US$12.8 million) at a premium of C$ 15,000 (US$9,598), according to the council.
In response to the situation, the council asked the Canadian government to provide the air show industry indemnification and legislative relief similar to that given to airlines and airports following the Sept. 11 terrorist attacks. The council asked that either the airports' requirement for additional insurance for air shows be rescinded or that the coverage be provided as part of the airport's insurance or the government's insurance for airports. The government refused both suggestions.
One of the recent canceled events affected by the demand for coverage was the 2002 London, Ontario, Air-show and Balloon Festival in June. The event typically generates C$5 million (US$3.2 million) annually for the local economy. In addition, Cudahy said that anywhere from seven to 22 other Canadian air shows may face the same situation this year.
"In some situations, the shows will buy policies, and we're working to try, with some success already to lower premiums," Cudahy said, adding that the most recent concrete bid the council received was C$ 110,000 (US$72,000).
Unlike Canada, United States air shows are not affected by these policy provisions. While some war and terrorism coverage is currently being written in the United States, it is not mandated by the government and is so prohibitively expensive that airports aren't purchasing it, said Cudahy.
Spectator Deaths and Injuries
Numerous spectators have been killed or injured over the years during various sports and entertainment events. Spectators have been killed or injured by flying debris from race cars, lightning strikes, overzealous o·ver·zeal·ous
Excessively enthusiastic: overzealous movie fans; an overzealous manager.
o crowds, hockey pucks and baseballs. Below is a list of some spectator incidents:
* Earlier this year, a 13-year-old girl died when an artery was damaged as her head snapped back after being hit by a puck at a National Hockey League game.
* In July 2001, in Amherst, Ohio Amherst is a city in Lorain County, Ohio, United States. The population was 11,797 at the 2000 census. History
The town of Amherst was established by German immigrants in 1807. , two race cars jumped a guard rail and hit a section of bleachers at a race track, killing a driver's wheelchair-bound mother and injuring at least 11 spectators.
* A baseball spectator at the Kansas City Kansas City, two adjacent cities of the same name, one (1990 pop. 149,767), seat of Wyandotte co., NE Kansas (inc. 1859), the other (1990 pop. 435,146), Clay, Jackson, and Platte counties, NW Mo. (inc. 1850). Royals' home opener in April 2001 was injured after he fell 12 feet from the left-field bleachers onto the warning track.
* In January 2001, a 15-year-old girl suffered a fatal heart attack when she was crushed at the Big Day Out concert in Australia. Six other fans were taken to a hospital with injuries, including heat exhaustion heat exhaustion, condition caused by overexposure to sunlight or another heat source and resulting in dehydration and salt depletion, also known as heat prostration. The symptoms are severe headaches, weakness, dizziness, blurred vision, and sometimes unconsciousness. and back complaints. About 35 spectators suffered minor injuries.
* During the 1996 Summer Olympics, a pipe bomb exploded during a late-night rock concert outside the Olympics venue, killing a 44-year-old Georgia woman and wounding 111 others. A Turkish television cameraman died of a heart attack while covering the incident.
* During the 1991 Open at Hazeltine National Golf Course near Minneapolis, six spectators were struck by lightning, including a 27-year-old man who became the first spectator killed by lightning at a golf tournament.
* On Aug. 28, 1988, at least 400 people were injured during the U.S. Air Force's annual open house show at Ramstein Air Base in Germany. Two Italian Aermacchi MB 339A jets collided and erupted in fire, and one spiraled into the crowd of nearly 200,000 people.
* In 1985, 39 people died and 375 others sustained injuries in a crowd panic during a soccer game in Brussels, Belgium.
* On Dec. 3, 1979, 11 people died during a concert by British rock British rock and roll, or British rock, was born out of the influence of rock and roll and rhythm and blues from the United States, but added a new drive and urgency, exporting the music back and widening the audience for black R & B in the U.S. group The Who at Riverfront riv·er·front
The land or property along a river. Coliseum in Cincinnati. The victims were trampled as a group of concert-goers raced for unreserved seats.