Liability, Safety, Insurance & Risk

1. Liability, Safety, Insurance & Risk

2. We design programs to be safe, but injuries are going to happen • More than just children are at-risk • Organization • Players • coaches • Officials • League officers and directors • Municipalities • League sanctioning bodies • Spectators • Public • Others who have contractual relations with program

3. Types of Injuries • Bodily injury • Emotional injury • Property damage • Violation of individuals rights under the state • Federal or constitutional laws • Breach of contract * All usually result in an expensive lawsuit!

4. Legal Terms Defined • Liability – state of being legally obligated & responsible • Standard of Care – act as a prudent person would in the same situation; responsibly • Tort – a civil act that; basis for a lawsuit • Negligence – at fault for accident; not following stand of care

5. 4 Elements of Negligence • Duty owed – obligation is owed to protect against unreasonable harm (must perform “reasonable person standard”) • Breach of duty – the duty that is owed is breached • Causation – the breach of duty is the cause of the injury • Damages – an actual loss or damage must result

6. 5 Defenses to claims of negligence • Prove that any one of the 4 elements of negligence is not valid • Assumption of risk • Contributor negligence • Comparative negligence • Act of god Again, you should have had all of this in Rec Law!

7. Damages • Bankruptcy • Breach of contract • Vicarious liability • Sovereign immunity • Charitable immunity • Volunteer immunity • Note Volunteer Act of 1997

8. Knowing Who Can Be Sued • Attorneys are required to sue any and all entities and individuals whom their client could possibly have a legal claim • “Shot-gun” • Most settle out of court to avoid all of the legal fees • List of who can be sued (6 “areas”): • Where can lawsuits arise from?

9. Automobiles • Bad idea, but we do it anyway • If an accident occurs resulting in injury – • Who can be named in the lawsuit? • Org, driver, owner of vehicle • Org can be sued for negligence in failure to screen out drivers with poor driving records

10. What to do: • MVR’s should be run every year on all personnel who will be transporting passengers (own car or orgs car) • Drivers with unacceptable MVR should be put on “non-driver” status and prohibited to drive for any reason for the org. • MVR’s can be obtained from state highway dept. • Present driver’s full legal name, date of birth, state’s driver’s license number. • Make clear what disqualifies a driver such as: • More than 3 minor violations or accidents in past 3 yrs • 2 at-fault accidents within 3 years • ANY serious violations in past 3 years (DUI, reckless driving or 20 mph over speed limit)

11. Hosting Tournaments/Events • Require visiting teams to provide a Certificate of Insurance with the following coverage • Accident insurance • Maximum medical limit of at least $25,000 • General liability Insurance • Certificate should indicate an Each Occurrence limit of at least $1,000,000, clearly stating coverage exists for participant legal liability • If visiting team has no insurance you can: • Purchase a special Accident and General Liability Policy for the event and charge each participating team for their share of the cost

12. Hold harmless and Indemnification Provisions • If you lease it…you can be sued! • Hold Harmless – youth org (the ones leasing) agrees not to bring the facility owner into any lawsuit against they youth org. • Indemnification – youth org agrees to pay the lawsuit costs (all) of the facility owner if the injured third party sues the facility owner (remember, everyone can be sued!) • Watch out for facility owners that are too “heavy headed”…they expect too much • Ex: • If org is responsible for upkeep and maintenance of facility other than during sanctioned and supervised activities ----make special arrangements with your insurance! • Usually, a General Liability policy must be purchased for 25/365 coverage • ** Most regular sport org. insurance policies only cover injuries during sanctioned and supervised activities!

13. 15 most common ways to be sued: • Spectator Injury • Participant injury

14. Help Prevent Losses • Avoidance • Prevention • Reduction • Contractual Transfer

15. Techniques used to pay for losses • Insurance (most common) – safest and most expensive way to pay for losses • .60 for every $1.00 is available to pay for losses • Funded Reserve • Out-of-Pocket

16. Accident vs. General Liability Insurance • Accident Policy pays the medical bills on behalf of injured participants • Coverage is usually “excess” meaning pays what the parents insurance does not. • 1st line of defense to lawsuits b/c lawsuits are usually about $$

17. Accident Insurance Cont. • Max limit should be at least $25,000 • Doesn’t cost much more to increase premium to even $50,000 or even $250,000 • Watch for internal schedule of benefits that further limit certain categories of expenses • Surgeons fees $1000 • Daily hospital room $100 per day • Doctor’s visits $20 These are poor quality as the pay out is often 50% or less….talk about some upset parents!

18. Accident Insurance Cont. • The problem with primary Accident policies. • They seem good b/c they pay without regard to other collectable insurance BUT, • Rarely effective because: • Expensive and water down pay out which often results in only about 50% of coverage

19. Accident Insurance Cont. • Deductions • Commonly range from $0 - $250 per claim • If a policy has a deductible, clearly explain to the parents THEY are responsible for the deductible • Payout period – the time period the ins. Company will pay incurred bills from the date of the injury • All accident policies have at least a 1-year payout period • When you have a max medical limit of at least $100,000 request a 2-year payout period. • This should cost an additional 10% of premium, but well worth it • Most only pay medical bills determined to be usual, reasonable, and customary

20. Accident Insurance Cont. • Should cover all adult supervised and league sanctioned (not sponsored) activities • Most do NOT cover non-sporting activities! • Ex: pool parties • Should cover everyone, not just athletes • Be careful some companies will try to charge you extra for volunteer coverage….. • The best ones will cover all volunteers for no additional charge

21. General Liability • Provides an attorney and will pay up to the policy limits for settlement or an adverse jury verdict • Even if NO negligence is found, the legal defense costs can range from $5000 to $50,000 in many cases

22. General Liability Policy Cont. • Should have • Each Occurrence or Per Claim limit of at least $1,000,000 b/c it only costs about 15% more to increase coverage from $500,000 to $1,000,000 • Watch out for “aggregate limits” that limits the pay out for multiple lawsuits in a 12-month period • The better policies will not have these

23. You need to buy BOTH Accident and General Liability insurance. • One of the biggest mistakes of youth org is to think you only need one or the other! • 4 most popular excuses for not purchasing both Accident and General Liability Insurance:

24. Our neighborhood is very affluent and all parents have health insurance • We don’t need GL because we have waiver/release forms • We don’t need GL because we have waiver/release forms • We don’t need GL because a coach certification, homeowners, personal umbrella already protects our volunteers