Gymnastics insurance is a fact of life for any gymnastics club owner. The possibility of a major accident and/or the possibility of lawsuits cannot be ignored. Your first line of defense is an accident/medical and liability insurance package. The following are some considerations in choosing your insurance carrier.
Cover Everything You Do
Make sure there is trampoline coverage, birthday party coverage and coverage for any other activities you will be doing.
Get the Maximum in Protection
Make sure you have a minimum $1,000,000 of liability coverage. Get the maximum amount of accident and liability insurance coverage possible (affordable). However expensive insurance seems when paying the bill, it will seem cheap if there is an accident or a lawsuit.
How Stable is Your Insurance Company?
Compare the ratings of any insurance carrier that you are considering. You cannot collect from a company that does not have sufficient financial resources and reserves. The ratings system is as follows:
An insurer rated ‘AAA’ has EXTREMELY STRONG financial security characteristics. ‘AAA’ is the highest Insurer Financial Strength Rating.
An insurer rated ‘AA’ has VERY STRONG financial security characteristics, differing only slightly from those rated higher.
An insurer rated ‘A’ has STRONG financial security characteristics, but is somewhat more likely to be affected by adverse business conditions than are insurers with higher ratings.
An insurer rated ‘BBB’ has GOOD financial security characteristics, but is more likely to be affected by adverse business conditions than are higher rated insurers.
An insurer rated ‘BB’ or lower is regarded as having vulnerable characteristics that may outweigh its strengths. ‘BB’ indicates the least degree of vulnerability within the range; ‘CC’ the highest.
Some companies offer financing plans, which may be a consideration, in a start-up. Make sure you understand the financing costs and consider alternate financing methods.
Number of Students
Don’t accept any policy requiring individual student name filing requirements. Although we don’t believe any of the insurers are doing this any more, some companies used to want you to supply the name of every student to be insured. Don’t do this, the paperwork is a nightmare.
Don’t Pay Too Much
DO report the minimum possible number for a start-up gym and then increase your coverage as your gym grows. DON’T anticipate say 300 students and pay for that number and then take a year to grow to that number. Start with 80 (or whatever the minimum for the company is) and increase as you grow and get paid insurance fees for students. For more information on how to save on insurance costs, contact our consulting service.
Cover Your Costs
Most gyms finance the cost of insurance with a fee charged to students on an annual or session basis. You will need to charge students the full insurance cost per student amount in the fee, not prorate it for the year since you will be charged for the student no matter how long they are enrolled. We recommend you charge 3 session fees per year any one of which will cover the insurance costs.