What Insurance Do You Need For Your Water Sports Business
Jul 30, 2020
Here are the Insurance Coverages You Need to Keep Your Water Sports Business Safe & Fun!
As a water sports business, you help others have exciting, adrenaline-pumping fun on beautiful lakes and oceans. No matter what sport you offer - parasailing, water skiing, paddle boarding, snorkelling, kayaking and so on - you need the right insurance coverage for your water sports business to provide safe fun for customers and staff. Water sports businesses have unique liabilities and risks to consider when insuring. In this blog, we'll be covering what risks you may have as a water sports business and what insurance coverages you need for your water sports business.
What Are Insurance Coverages That All Businesses Need?
Your water sports business may be a bit different than the standard office (your view is definitely better!) But there are still coverages that all businesses, including water sports businesses, should consider carrying.
Commercial General Liability
Commercial General Liability or CGL is a common insurance policy that all businesses should hold. It can protect your water sports business in Bodily, Property (if your product or service damages someone's property) and Advertising Injury by providing coverage for legal fees, medical costs and payment for damages. The unfortunate reality is that bodies of water and extreme sports can be dangerous - even for trained professionals.
How can Commercial General Liability (CGL) help my water sports business?
- A customer accidentally accelerates too quickly on a jet ski and sprains their shoulder. Having CGL coverage can help cover their medical costs and the legal fees if they decide to pursue action in court.
- During a sudden severe storm, some of your equipment out on the water accidentally damages the boat next door to you. Your CGL coverage helps to pay for the damages.
- Your nearby competitor is also a snorkelling business; they sue your business arguing that your logo copies theirs which causes confusion among customers and a loss in business for them. You can use your CGL coverage to cover legal fees and any damages if they win the case.
Commercial Property Insurance
Commercial Property Insurance covers your business’s physical assets against loss or damage from a broad range of causes - such as (but not limited to) fire, hurricane, water damage and vandalism. This type of insurance covers not only the building you operate out of, but the contents as well. Owning a water sports business means you are likely near the water; this coverage can be a big help for your building and equipment if a natural disaster were to occur.
How can Commercial Property Insurance help my water sports business?
- A hurricane damages your building, sporting equipment and the contents inside your building such as computers and merchandise. Your Commercial Property Insurance helps to cover the costs of repairing and replacing property.
Business Interruption is a coverage that you can add onto your Commercial Property Insurance. It can cover profits and fixed costs, including ordinary payroll and extra expenses, when a business property claim arises to cover the profits a company would have earned had the loss not occurred. If you have ever had to do a major repair on the property of your water sport business, you know that it can mean closing your business down temporarily to complete the repairs. Having Business Interruption can help cover the profits you would normally make if you were not closed.
How can Business Interruption help my water sports business?
- Your building unfortunately had some water damage and now requires a restoration team to come in. They recommend closing the business for a few days so they can use their industrial fans to dry the building and prevent future mold. Your Business Interruption Coverage provides the profits you lost while closing temporarily for repairs.
Cyber Liability Insurance can provide coverage for cyber incident response costs, cyber-crime including social engineering, cyber extortion, network damage, system interruption and privacy liability. This insurance coverage can help cover the costs of responding to the cyber crime or liability damages. It may not seem obvious or necessary for a water sports business to have Cyber Insurance; often times, it is assumed that tech-related business or only large corporations needs Cyber Insurance. However, cyber crime is on a dangerous upward trend for all businesses! Those who commit cyber crime often do not only target large, tech businesses but frequently, small businesses that they know have little security. When small businesses are breached, they also have less resources to get back on their feet, unlike bigger businesses. Even if your water sports business mainly deals with the outdoors, you likely still rely on technology to store personal information about your employees and customers! All small businesses that use digital tools - even e-mail - should consider Cyber Liability.
How can Cyber Liability Insurance help my water sports business?
- At your paddle boarding business, you use a digital POS system to accept payment from customers and to track sales. This system suffers a massive data breach and the personal information of all of your customers is compromised. Cyber Liability can help to cover the cost and fees of managing the situation.
- One of your co-workers, who is in charge of responding to business emails, falls for a phishing scam posing as a fellow co-worker. They accidentally send them the personal details of all of the staff. Your Cyber Liability can help cover the costs of damages and privacy liability.
Additional Insurance Coverages to Consider for Water Sports Businesses:
What other kinds of insurance do you need for your water sports business? Here are some other coverages to consider:
Watercraft Insurance Coverage
Think of this like Commercial Auto Insurance but for boats and other watercraft! If you own water-crafts for your business and they get damaged, this coverage can help with the costs to replace or repair them.
Professional Liability Insurance or E&O can protect your business against claims arising from failure to provide the expected service level, from errors or from negligence. This coverage could apply if you have instructors that provide a service or guidance as their job. For example, let's say, part of your business is surfing or wakeboarding lessons. If someone gets injured and they pursue legal action, accusing one of your employees for poor or incorrect instruction, then your Professional Liability Insurance could provide coverage for legal fees and damages if the customer succeeds.
If you have aquatic rentals or charter boats, you should consider Hull Insurance to cover damages to your boats.
Employment Practices Liability
Do you have employees? Employment practices liability exposures are ever-increasing for employers, particularly through COVID-19. An Employment Practices Liability policy will help defend against potential allegations of wrongful dismissal, harassment and discrimination - among other accusations.
Management Liability (D&O)
Are you a larger operation with directors and officers employed making critical decisions on behalf of the organization? As we navigate the new normal, these decisions have never been more difficult; management is greater exposed to litigation based on their decisions. A Directors and Officers policy helps to protect against this litigation protecting the personal assets of the directors and officers which would otherwise be exposed without the proper coverage in place.
It's important to consider pollution liability as a part of your overall risk management program. A pollution incident can be severely expensive, involving not only responsibility for clean up fees, but also other applicable fines. Total costs of these events can be in the millions of dollars.
Learn why Captain Lee Marcoux of Grand Bend Parasail chose Foxquilt for his Parasailing Business Insurance and why he gives us 5 stars!
Water sports are a fantastic and exciting way to experience the water; having the right insurance coverage can help protect everyone too. We hope this helps provide some understanding into what do you need to insure your water sports business. Our Foxquilt team of professionals is experienced in helping businesses of all industries and sizes. We have helped provide Captain Lee Marcoux of Grand Bend Parasail liability insurance for his unique parasailing business; learn more about why he chose us in his testimonial. If you're looking for a beautiful and fun way to experience Grand Bend, Ontario and Lake Huron, give Grand Bend Parasail a visit! If you need help reviewing your water sports business insurance, get a quote with Foxquilt today.
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