Buying Sports Insurance? Don't Make These Mistakes | Sports Destination Management

Buying Sports Insurance? Don't Make These Mistakes

Dec 19, 2021 | By: Pamela Smith
Photo © Denys Kuvaiev |

Sports and fitness come with risks of injury  and lawsuits from players, spectators, or other involved parties. It is, therefore, crucial to purchase sports insurance for protection to ensure you don’t suffer financial setbacks in case of injuries or lawsuits related to your sporting event. To help you make informed decisions, below are common mistakes you should avoid when obtaining sports insurance.

1. Neglecting Some Insurance Policies

One of the most common mistakes when buying sports insurance is neglecting some policies assuming that you don’t need them. However, don’t underestimate the expenses of claims regardless of how excellent your history is. With numerous sports insurance policies available, you need to evaluate your needs and purchase the insurance to cover them.

If you are buying an insurance policy for your sports organization, below are some types of insurance policies you should consider.

• Accident insurance to cover any medical bills due to participants’ injury

• General Liability Insurance. This protects you against lawsuits from spectators or participants who may suffer injuries or property damage due to alleged league negligence.

• Directors and Officers Liability. This offers protection from lawsuits alleging violations of rights under civil or federal law or economic injury resulting from mismanagement of the sports organization.

• Crime Insurance. It protects you against financial losses from theft or embezzlement by employees or volunteers.

• Equipment Insurance to cover loss or damage of sports equipment

Without the right policies, you may suffer litigation for managerial negligence in case of a significant claim.

2. Buying Inadequate Insurance

Buying inadequate insurance may seem like an excellent opportunity to save money.  However, the little savings you make may cost in the form of large future payments for injury or lawsuits due to lack of coverage. Also, smaller premiums translate into less payout in case of a loss, making you dig deeper into your pockets in case of a lawsuit or injury.

Choose a sports insurance that covers your organization, athletes, both paid and unpaid staff, officers, directors, as well as volunteers.  It should also protect sponsors and field owners whenever necessary and have limits high enough to provide full coverage for injuries or lawsuits. When shopping for sports injury policies, consider those that include brain injury, punitive damages and participant liability injury.

3. Overpaying for Sports Insurance Policies

You don’t have to overpay for your sports insurance when there are numerous ways to save money. To avoid overspending on your sports insurance policy, begin by making a budget and determining how much you are willing and able to spend on all your sports insurance needs. Doing so allows you to only work within your financial abilities when looking for the best policies and insurance providers.

Also, research potential insurance providers and compare their prices instead of settling on the first company you find. Shopping around will give you insights into the rates of different providers so you can choose the one that matches your budget while providing the coverage your need. Other ways you can avoid overpaying are by taking advantage of discounts, buying specifically from sports insurance companies, and teaming up with other organizations to utilize group purchasing power.

4. Not Doing Due Diligence on Your Insurance Provider

Buying your sports insurance without researching the insurance company is a mistake that may result in overpaying for the policy or getting a raw deal from unreliable companies. Before purchasing an insurance policy, perform due diligence on the insurance provider and find out all you need to know about the company. One of the most critical factors to look out for is the company’s financial health, as it determines its ability to meet your needs and fulfill its financial obligations.

To avoid working with a company at the risk of bankruptcy, check the insurance provider’s credit rating and settle for nothing less than an A-. Other factors to look out for in your sports insurance provider are a license for credibility purposes, the company’s reputation (check reviews and testimonials) and coverage. Also, consider the prices of the various policies the company offers. The rates may affect coverage, and how much you may have to pay in case of a loss.

5. Not Reading Insurance Policies

When buying sports insurance, you need to understand every aspect of your policy, including coverage and rates, as well as the time frame for filing claims. Most people make the mistake of skimming through their insurance policies and not understanding how it works. For example, you may think your insurance policy covers brain injuries or sexual harassment lawsuits, only to be surprised when the risks occur.

To avoid making this mistake, ask for every copy of your insurance policy and read it page by page. You can also consult a sports law lawyer to help you interpret and clarify your policy’s contents before committing your money.  In case of any questions or concerns, ask your insurance agent to help you make an informed decision on whether to buy sports insurance or not.

When purchasing sports insurance, having accurate information can help you avoid mistakes that may prevent you from choosing the right policies or insurance providers. Having known common mistakes that most buyers make, you can avoid them and make better choices regarding sports insurance. SDM

About the Author