Insurance premiums are typically one of the largest overheads for attractions operators. In order for them to receive the maximum value from their insurance contract in both its coverage and price, the underwriters and brokers need to fully understand the risk.
Risk Management is a major part of the solution to this problem. By implementing good risk management arrangements, the exposure to incidents is often reduced and claims can be managed – an interesting task when rides and attractions are meant to thrill, excite, entertain and, most importantly in many instances, ‘scare the pants off’ the guests.
The technology incorporated into today’s rides and attractions is cutting edge, from complex electromagnetic braking mechanisms to software controlled multilayer safety redundant systems. All are positive factors the insurance industry needs to be reminded of when presenting a risk in its best light to underwriters and securing the best policy and premium in the market place.
Health and Safety
The leisure industry has always driven the high safety standards that can be seen today, promoted by associations such as BALPPA in the UK and IAAPA, and also of course The Showmen’s Guild of Great Britain. Whether in the UK, Europe or North America, the leisure and entertainment industry faces a wide variety of liability risks. Many of these risks are obviously due to the high levels of public attendance and the public’s direct participation in activities.
The public liability insurance rates calculated by Insurers are, of course, directly related to this and they are particularly interested in the incident frequency and in turn the risk management of the operator.
So is there anything an operator can do to improve their risk and appetite to insurers? Like most sectors, organisations within the global amusement and attractions sector are experiencing increasing levels of claims, particularly with the world recession climate we now find ourselves in. Slips, trips and falls continue to result in the highest percentage of incidents and claims reported in the sector.
It assists therefore to have comprehensive health and safety arrangements in place to control risks, supported by comprehensive records which assist insurers to defend against spurious claims. The more spurious claims that can be successfully batted away, the lower the loss ratio and the more marketable that risk becomes to existing and other insurers.
Employee health and safety also takes on a new dynamic in the amusement industry due to the very nature of some of the working environments. Amusement park employees can range from those performing typical administration duties to a carpenter performing a repair some 20m in the air on a roller coaster.
Other roles can include skilled trades such as electronics, mechanical engineering. These broad and often diverse individual trades have to be brought under the umbrella protection of the operator’s Employers Liability Insurance programme. The number of employees working at height is obviously one of the main factors, and if this is restricted to key specifically trained individuals, such insurance can be arranged reasonably cost effectively.
Rob Marsh, Marsh & Company