Kyle Phillips, a Vice President with VGM Insurance & Financial Solutions, says the two biggest areas in which VGM, as an insurer, gets questions from clubs related to the pandemic are business interruption and liability related to communicable disease.
Kyle Phillips, a Vice President with VGM Insurance & Financial Solutions, says the two biggest areas in which VGM, as an insurer, gets questions from clubs related to the pandemic are business interruption and liability related to communicable disease.
The focus on risk management and ensuring member and staff safety will heighten as progress is made in reopening facilities such as the Oceanview Ballroom at the Hammock Dunes Club in Florida, where restaurants returned to 100% capacity at the end of September.
“Both of those typically are excluded from policies, so clubs find that coverage they thought they had doesn’t apply in this instance,” Phillips says. “Business interruption coverage requires a direct physical loss of some sort. Thus far, most business interruption claims have not been covered.”
Going forward, Phillips advises that clubs should consider additional coverage for event cancellations. “Those are relatively small policies a club can purchase on a one-off basis for a large event, or by insuring all your weddings for the summer,” he says.
As for general liability coverage and how it applies to communicable diseases, Phillips notes that the general rule—though there are exceptions—is that virus and communicable diseases are excluded from general liability policies.
“The insurance market in general, not necessarily just related to pandemic, is hardening,” he explains. “Clubs and resorts are seeing increases in some lines of business, such as property and umbrella coverage. Clubs should understand that certain things they might have been able to purchase in the past may not be available in the future, such as adding communicable disease coverage to a general liability policy.”
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