For many associations, insurance purchasing is not on the top of the agenda. Liability, secondary medical and Directors and Officers coverage is usually provided by the governing body that registers the players. However, in most cases that coverage does not address potential loss to the equipment or buildings used by the association. A fire in an equipment shed could destroy not only the building, but all of the necessary equipment contained inside. One Central Texas association lost its concession stand to fire and years later it has still not been replaced. In the Dallas area, a baseball league is just now completing the rebuilding of a concession stand that burned in 2010 (See story here).
Sound risk management includes a regular review of the insurance coverages available to the league. An association should not rely upon their governing body’s coverage for all needs. A risk management plan can lay out the parameters for potential insurance coverages. However, even after enacting such a plan, regular review of the coverage is advisable. The insurance needs and coverage available to an association can change over time, and a regular insurance audit is the best way to address this concern.
While your agent can be a good source of information about new coverages, an insurance attorney can also analyze your exposure. There are two advantages to using an independent source to evaluate your coverage. First, an independent evaluator has no financial stake in your purchase of new coverage. Second, you can ask the independent evaluator to assess both the league coverage and the coverage provided through your governing body to make sure there are no gaps. We recommend that all coverages be reviewed against the league’s operations at least every two years.