Do you know where your insurance policies are filed? Do you review them regularly or just pay the premiums when they come, assuming you have adequate coverage?
Often, when we think of insurance, we envision the catastrophic situation -- a tornado, a hurricane -- that most likely never will occur at our meetings. However, whether someone has a heart attack on the convention floor, there’s an electrical outage or a labor strike is held at the host hotel, you will experience situations that will put you, your company and/or your client in a risky position. Having the right policy in place is the key to spreading the risk of financial loss.
Most planners in the meetings industry have little or no opportunity to give serious consideration to insurance. For instance, corporate events might be handled by the company’s own risk-management department. However, independents need to assess their individual ability to obtain insurance.
It is important for the meeting professional to appreciate what insurance can and cannot do to insulate against loss. Many hotel, convention center and third-party contracts require the meeting sponsor to provide evidence of insurance. You should be sure you also know what kind of coverage is in place for the supplier.
Types of Coverage
At the very minimum, both the planner and the organization must have comprehensive general liability insurance. This policy, sometimes called commercial general liability, covers third-party claims against everything from bodily injury to property damage.
When buying this insurance, add a rider concerning the coverage of contractual obligations. This important piece in the insurance puzzle protects everyone -- planner, organization and supplier. When you sign contracts requiring you to indemnify and hold harmless the supplier, you also want to be certain the supplier indemnifies both you and your organization.
Umbrella coverage is another must, and it does as implied Ñ it also protects both the planner and the organization against all eventualities that are not otherwise provided in basic insurance programs, such as a disaster costing more than the liability policy’s deductible and/or limit. Umbrella policies do require holders to meet certain minimums in basic coverage, which vary depending on the nature of the event.
To protect money outlaid in advance or the income a meeting is expected to generate, it’s wise to buy business interruption or convention cancellation coverage.
Getting a Broker
I cannot emphasize strongly enough the necessity of having a good insurance broker, one who understands meetings and the types of risks inherent within the industry. He should be prepared to dis-cuss how much coverage you need, and where and how to make certain determinations. He should be prepared to handle any issues specific to your event or venue and be able to assess whether a claim has been lodged properly.
When dealing with your broker, be specific. Describe the situation or issue exactly as you see it, so the broker can identify what you need to do to eliminate the potential for unnecessary risk and how you should respond in a crisis. What if your client wants to offer meeting attendees a chance to go white-water rafting or hot-air ballooning? Your broker should advise you that these are high-risk activities for which attendees should sign waivers. In some cases, such events might require special underwriting.
We’ll continue this discussion next month, focusing on specialized policies to further narrow the liability gap.
Jonathan T. Howe, Esq., is a senior partner in the Chicago, St. Louis and Washington, D.C., law firm of Howe & Hutton Ltd., which specializes in meetings, travel and hospitality law. Legal questions can be e-mailed to him at email@example.com.