When General Liability Coverage Slips Through the Cracks
New Year’s Day parades and snow storms have come and gone, as spring weather welcomes festivals, concerts, athletic events and all things outdoors. Events include a gamut of activities, so how does one properly prepare for such an event to ensure both fun and safety?
Special events are unique in that the policy period is limited to a brief period of time, sometimes as short as only a few hours, as opposed to a full year. The exposure, however, is maximized by inviting thousands of people onto the insured premises within such a condensed time frame. Whether a simple slip or fall or a traumatic injury, the exposure is heightened due to increased distractions and entertainment sources mixed with such a high volume of attendees.
Let’s set the stage. A nonprofit organization is hosting an outdoor concert with live music and entertainment. The band’s equipment and staging materials are secured to the earth outside the building where the event is being held. One of the wires is loosely secured to the ground and a guest trips over it. He suffers a fractured arm that ultimately requires surgery. His medical bills total $23,500. He brings suit against the nonprofit organization for negligence in providing a safe environment. The claim goes into litigation, incurring significant expenses.
In this type of situation, when someone gets injured on the venue’s premises, nonprofits might mistakenly believe their annual general liability policy would respond and that an event policy isn’t necessary. The general liability limits are meant to cover slips and falls that occur sporadically throughout the policy period.
An event policy, however, is in place because one event can give rise to multiple claims in just one day’s time. This would otherwise erode the general liability limits fairly quickly. Additionally, many annual general liability policies include a classification limitation, premises limitation and liquor exclusion, all of which are important coverages for an event policy.
An event host should have an event policy in place to respond to these occurrences so the annual general liability policy limits aren’t quickly eroded. Our Special Events product provides the feeling of being in control in the event something unplanned happens.
Please contact your Commercial Lines underwriter for more information or a quote.
Contact Cheryl Ryan,
Executive Vice President, Division Leader | 844-438-6775 Ext. 2582
Written by Molly McShea
March 16, 2017