|
The executive-class event worthy of a standing ovation from one of the most inspired companies in the world with Tapis Rouge. more... |
|
Find Articles/Resources
Search our extensive database of Articles and Resources
Insurance: An Event Planner's PrimerWhat event planners need to know about the insurance they cannot afford to do withoutBy Adrienne K. Yee Special events are in some ways, a microcosm of life. Let's face it: anything can happen, and the unexpected can intervene in ways no one could possibly predict. That's why having good insurance coverage is an absolute necessity. Obtaining the right insurance may seem complicated, especially with the myriad risks and liabilities that exist today, but securing the proper insurance coverage is vital to protecting your company and those you work with. Having basic insurance information at your fingertips is a first step in the right direction. The purpose of this article is to do just that: to provide answers to the basic questions planners may have about event insurance. It is an attempt to help industry professionals gain a better understanding of the risks involved and liabilities incurred in staging events, and a brief guide to what precautions planners should take. How should planners assess the coverage they need?To evaluate your company's insurance requirements, take a close look at the risks you face. Write down any factors you can think of that could cause a claim or a loss. Also, review your company's business plan, break down your total expenses, and estimate your net profit. Consider the number and scale of events planned per year and what high-risk activities are involved at these events. After you've done that homework, meet with an insurance professional whose expertise includes special events and who knows the right questions to ask you regarding your specific business insurance needs. Let the agent know everything you do to plan and produce events, as well as the vendors and contractors you use and the clients you work with. It should be standard operating procedure in planning an event to call your insurance company and have them advise you on what coverage you need for that specific event. Whom should you contact for insurance coverage? An independent broker? A big company?Either. The key factor to consider is expertise in providing insurance coverage for the event business—special events coverage requires a specialist. If the company is small, you might be more likely to find someone you can deal with regularly who will attend to your needs, instead of getting "lost" in a large organization. A big company might be able to give you a better price (vs. service, perhaps) if they are meeting your insurance for a range of events. There are several types of insurance representatives you can deal with and it's important to understand the difference. An "agent" is someone who represents a particular company or companies. An independent insurance broker, on the other hand, is not tied to any one company, and it is the broker's legal responsibility to work on behalf of the insured to find you the best policy that meets your specific needs for a particular case. What questions should a planner ask?The insurance agent should be doing most of the asking to better understand your business and the risks involved to determine your coverage needs. Questions worth asking include:
What insurance can't a planner afford to do without?
How much responsibility does a planner have vis a vis vendors?It is a planner's responsibility to read all vendor contracts. In the absence of a contract, a planner should assume responsibility for all property under his or her own care, custody, and control. Lease/rental or loan agreements must be reviewed, and are best handled prior to signing and event execution. What should a planner do if an insurance company refuses to pay a claim, even though the policy—including the fine print—seems to provide the requisite coverage?An insurance policy is a business contract between the insured and the insurance company, and all of the terms and conditions of coverage are contained within the policy. If an insurance company refuses to pay a claim, a complaint can be made to the insurance department. As with any contractual dispute, recourse includes claims review, claims remediation, arbitration, or legal procedures. What is a certificate of insurance?A certificate of insurance basically says your company has professional liability coverage. It is, however, nothing but a statement of what insurance you have and may not cover all your bases for a specific event. For example, if a planner brings in a vintage car to an event, the certificate of insurance does not necessarily cover the car. How about kiosks (Internet/computer stands) and other ancillary meeting accessories? Robots? Props? Who is responsible if something is damaged?The owners or renters of these items will suffer the loss and therefore should specifically insure these items. This is specialized insurance. Also, an owner will most likely contractually require the renter to cover the property while in their care, custody, and control. What if you're holding an event in a hotel, for example, and a hotel employee hanging a banner for the event falls and injures himself? Who's liable?If a hotel employee injures himself on site working on your event, the hotel is responsible, but a planner is not without some degree of exposure if for some reason, the hotel has no workman's compensation policy in place on the day of the accident. No matter what the situation, always review your contract agreements before the event. Check who is responsible for coat check liability, valet/parking attendants, renting or borrowing any equipment, etc. Advice from Event Planning ProsThe term "special events" professional encompasses a wide range of areas from a corporate event planner and independent producer, to destination management and tradeshow management companies. Agenda spoke to various people to ask for their insights and opinions on insurance and liability pertaining to their area of expertise. What are insurance considerations for trade show and expo companies?John Buttine, President, John Buttine, Inc. (an independent insurance brokerage firm whose client list includes George Little Management, a trade show management company) suggests the following: Important questions a tradeshow management company should ask an insurance representative include:
Trade show/expo management companies are exposed to liabilities arising from all sorts of different activities. Think of who and what is involved: carpenters and electricians are on the show floor during set-up, bus companies are transporting attendees, liquor is served at events or post show parties, booth operators may not have insurance and can cause losses that the planner will become liable for because of contractual requirements of the hall lease, etc. Be sure to have commercial general liability, event cancellation insurance, property insurance, and evidence of insurance from exhibitors. What are typical insurance costs?There really are no "typical" costs for insurance, says Adam Kahan, Esq., Producer, Empire Entertainment. Coverage needed depends on many variables including the number and scale of events that a planner does in a typical year, whether any "high risk" activities are involved at any of the events, etc. The best advice for an event production company, or an independent planner, is to meet with an insurance expert who knows the right questions to ask in order to determine proper coverage…. The best protection you can give yourself from an insurance standpoint is to make absolutely certain that every single vendor you hire for an event provides certificates of their own insurance that name you and your company as an additional insured, as well as naming your client and the venue as an additional insured…. Also, insurance certificates can be tricky—make sure that any certificates you receive actually name you as an "additional insured" and not just as a "certificate holder," which really affords you no rights at all. Also check the date of expiration of the vendors' policies as they appear on the certificates they send you, and make sure they are valid through at least the end of your event. How do you make sure you have adequate coverage?JPMorgan Chase has an entire department looking after our liabilities in different ways, explains Kathleen Moore, Vice President, Global Marketing, JP Morgan Chase Bank. I first consult with them to see what coverage I already have under a corporate umbrella, and to see what additional coverage I need to ask of my vendors. For example, if we are dealing with food and beverage from caterers, I would expect to be named as a co-insured on the caterer's policy. We also need to be sure that basic liability and workmen's compensation is in place with any DMC or other vendor that employs other people. We don't want to spend money for coverage that we already have as an institution, but we also want to do our own due diligence to be sure our vendors and other providers are adequately covered…. Be aware that having insurance won't prevent things from going wrong, and the best insurance is good planning and good people who care about the outcome. What should insurance coverage include?Patrick Sullivan, President, PRA Destination Management, suggests that the basic coverage reviewed should include liability and worker's compensation…. The coverage on liability should probably be at least $1-$2 million. DMC's should also have suppliers provide riders naming them as additional insured…. The most common areas to consider for a DMC could be: high risk activities, cash handling (bonded staff), transportation, serving liquor, and workmen's compensation…. Most insurance companies not familiar with the DMC business will generally classify them as a tour/transportation company with higher risk factors and therefore higher premiums…. Make sure you have the appropriate coverage for your company and your premiums are in line with the risk associated with you. Being classified in the wrong category can mean the difference in thousands of dollars in premiums. How much insurance do caterers need?Many venues and clients require that caterers carry anywhere from $1 million to $5 million in coverage, according to Kathryn Vermilye, Director of Catering and Special Events for Neuman & Bogdonoff. A $5 million umbrella policy is a good idea to have if you want to be considered for an exclusive arrangement with any venue or institution…. Caterers are exposed to liability in many areas in day-to-day operations. Food handling and sanitation, vehicle accidents, personal injury to employees and others, property damage, service and/or sale of alcohol, failure to fulfill contract obligations due to conditions beyond the caterer's control to name a few…. Managers should talk with their insurance representatives about available training classes for staff, such as driving safety, food handling and sanitation, how to screen for intoxicated guests and refuse to serve them any more liquor, etc. Caterers should be very aware of liability concerns especially at very large events and they should be prepared to take out extra insurance on an event-by-event basis, as needed. What insurance coverage do event venues need?According to Fred Seidler, Director of Metopolitan Pavilion, Directors of venues need to assess each event they book and ascertain appropriate security, safety and liability requirements. Groups renting the facility need to provide liability insurance naming the venue as an additional insured. The types of coverage a venue should have is general liability insurance $2,000,000 - $3,000,000+, liquor liability insurance for venues with a liquor license, and business interruption insurance. Minimizing Your Risks
Insurance Terms and Definitions
Companies specializing in event insurance:Event Insurance Brokers, LLC Rosen & Company TLA Insurance Agenda would like to thank the following people for their input and expertise: |
 |