Transcript Why Didn't I Buy the Right Insurance Coverage?

OR
There is only one thing to
remember today……
Rule Number One
You can’t be a little pregnant….
There are some hard fact of life
you need to deal with
My assistants for insurance
The assistant you would like
But your assistants look like this
WARNING:
This class can cause you to
drink..
This class can cause serious
mood swings…
Please sign this waiver….
WAIVER
I WAIVE ALL RIGHTS OF POSSIBLE
BODILY INJURY, LOSS OF MEMORY,
WRONG INFORMATION, POSSIBLE
SUCCESS OR FAILURE OF MY
BUSINESS DUE TO INFORMATION IN
THIS SEMINAR AND ANYTHING ELSE
AN ATTORNEY MIGHT THINK UP
AGAINST LARRY COSSIO.
SIGNATURE
DATE
IF UNDER 18, PARENT MUST SIGN
Many people just get into the
inflatable rental world to earn a
few bucks
Maybe you just want to upgrade
your family car
Or maybe get a faster car so you
are not late to your weekday job
Maybe you want a house in the
country just to get away…
• We will review some claims in the inflatable
and equipment rental world
• We will identify causes of accidents
• We will identify what insurance coverage’s
you should have and why
• We will identify what a certificate of
insurance is and why you keep getting asked
for one
Let’s look at what will ruin your
business…..
Infant critically injured after fall from kiddie train ride
(Tuesday, March 10, 2009) - At a mall in Cutler Bay, Florida, a 12-monthold boy suffered severe head injuries when he fell 2-3 feet from a
mechanical kiddie train. He landed on his head, then was partially run
over by the train before it could be stopped. Rescue workers arrived to
find the child unconscious and unable to breathe on his own. They
began CPR, revived him, then transported him via helicopter to Miami
Children's Hospital, where he was listed in critical condition.
The Miami-Dade Police Department is investigating the accident and the
ride has been shut down.
UPDATE: The boy died from his injuries on March 17, 2009.
Mechanical Swing Ride
Child, 8, injured in fall from swing ride
(May 2, 2009) - An 8-year-old suffered minor injuries in a
fall from a mechanical swing ride at a carnival in
Orangeburg, South Carolina. Investigators believe that
the child was began to come out of the swing as the ride
was slowing to a stop.
“There was no apparent malfunction of the machinery,”
said a fair spokesman, and the child's size was not
thought to be a contributing factor in the accident.
The ride passed a state inspection two weeks ago.
Inflatable slide…..
Inflatable slide tears apart, injuring teen
(May 25, 2009) - In Lumberton, Texas, a 14-year-old
girl was injured after falling through an inflatable
slide that had ripped open from top to bottom. The
girl fell 26 feet to the ground and suffered a
fractured arm, a bruised hip bone, and a concussion.
Inflatable
Teen paralyzed after flip on inflatable ride
(June 21, 2009) - In Denison, Texas, a 17-yearold boy was left partially paralyzed when he
fell on his neck after a back flip while playing
on an inflatable ride.
Inflatable ride went flying….
(June 27, 2009) — In Middletown, Ohio, an inflatable ride
went flying 40 feet into the air with an 11-year-old boy inside,
who escaped serious injury by hanging on until bystanders
stabbed the ride with knives, deflating it.
Several other children suffered minor injuries when they were
bumped or scraped by the ride as it flipped several times
during its flight.
Inflatable water slide….
Safety concerns shut down inflatable water slide
(August 6, 2012) - A 60-foot-tall inflatable water
slide in North Myrtle Beach, South Carolina was
shut down after an inspection revealed that the
ride may have developed dry rot in one or more of
its seams.
Another inflatable goes flying…
Another inflatable goes flying; girl falls onto roof
(February 20, 2011) - In Marana, Arizona, two girls were
tossed out of an inflatable jumping castle when a gust of
wind carried it at least 100 feet through the air. One girl was
tossed out onto the ground and suffered only minor
injuries; the other was ejected onto the roof of a
neighbor's house and suffered serious injuries, including
head injuries.
Another inflatable topples in wind
Another inflatable topples in wind; 3 children injured
(April 21, 2011) - At a carnival in New Square, New
York, three children were injured when a gust of
wind toppled an inflatable castle.
Another inflatable slide collapses
Another inflatable slide collapses; 5 injured
(April 29, 2011) - At an elementary school in Clovis,
California, five children were injured when a wind
gust toppled an inflatable slide.
Another inflatable slide collapses…
Another inflatable slide collapses; 4 injured
(May 7, 2011) - At a festival in Encino, California,
four children suffered minor injuries when an
inflatable slide collapsed. According to the Los
Angeles Fire Department, too many children were
on the slide, and there was no adult supervision
at the time of the accident.
Three inflatables blow away….
Three inflatables blow away with children inside; 17 people injured
(June 4, 2011) - In Oceanside, New York, three inflatable castles with
children inside them were blown through the air in a gust of wind.
Seventeen people were injured, some of whom were struck by the
inflatables once they hit the ground and started rolling. One person
was hospitalized with critical injuries; the others were treated at
hospitals for minor injuries.
CBS News reported that the inflatables were installed by Affordable
Inflatable Entertainment of Oceanside, and the company owner said
that all of the inflatables were anchored properly.
Another inflatable slide topples…
Another inflatable slide topples; children injured
(May 27, 2011) - Eight children were sent to a hospital
after an inflatable slide toppled over at an elementary
school in Lyons, Illinois. Some of the children fell as
high as 15 feet and landed on asphalt.
The victims' injuries were not life-threatening.
Another inflatable goes flying…
Another inflatable goes flying; 6 injured
(May 13, 2011) - In Tucson, Arizona, a whirlwind
tossed an inflatable castle through the air and left it
wrapped around a light pole. Six children were
struck by parts of the attraction and suffered minor
injuries.
Landing in tree across the street
Another inflatable slide collapses…
Another inflatable slide collapses; 5 injured
(April 29, 2011) - At an elementary school in Clovis,
California, five children were injured when a wind
gust toppled an inflatable slide.
Another bounce house blows away…
Another bounce house blows away; 2 children hospitalized
(April 2, 2011) - In Tucson, Arizona, 2 children suffered
serious injuries after a bounce house was blown into the
air by a sudden gust of wind while they were inside it.
According to Tucson Police, the inflatable blew across
three lanes of traffic before it landed on the side of a
road. The children were hospitalized; both were expected
to make a full recovery.
Deadly Tent Collapse Kills One
 An Illinois man was killed and about 100 people were hurt when
high winds caused a deadly tent collapse outside a St. Louis sports
bar, the Associated Press reports. 4/30/12
 The tent collapse happened as a fast-moving storm rolled in
Saturday, after a St. Louis Cardinals game at nearby Busch Stadium.
Winds exceeded 70 mph, a spokesman for St. Louis' mayor said.
 The deadly St. Louis tent collapse occurred when a sudden gust of
wind shattered the aluminum poles holding up the tent. Debris flew
through the air as the tent was blown onto nearby railroad tracks.
 About 200 people were underneath the tent when it collapsed.
About 100 victims were treated for injuries at the scene, and 17
were taken to hospitals, the AP reports.
5-year-old boy was killed at the
2008 Air Show
 "Our investigation has concluded that this was a preventable tragedy
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caused by negligent conduct," the Millers' attorney told the Huntsville
Times.
Negligent Setup, Lack of Safety Inspection, Code Violations Blamed for
Child's Death
The lawsuit outlines several areas where the defendants' alleged
negligence caused the fatal accident:
Improper tent setup: According to the tent manufacturer's instructions,
the tents needed to be pitched and staked individually, then secured with
four pegs at the corners. Instead, the lawsuit alleges, the group of tents
was erected in a line, with pegs securing one side, water barrels holding
down the other, and no securement at the sides. To save money, prisoner
labor rather than trained installers was brought in to pitch the tents.
Properly anchored, the tents should have been able to withstand winds of
up to 60 mph, according to All Needz. The winds on the Sunday that Josiah
died were recorded at 48 mph.
5-year-old boy was killed at the
2008 Air Show
 The family of Josiah Miller, a 5-year-old boy who was killed at
the 2008 Air Show at the Huntsville International Airport, has
filed a wrongful death lawsuit against the organizers of the air
show, the Huntsville-Madison County Airport Authority and All
Needz Rental. They claim that those groups share
responsibility for the accident that led to Josiah's death.
 According to the family's complaint, Josiah and Jason Miller,
his father, took shelter behind one of the tents during a
thunderstorm. Several of the tents became dislodged because
they were inadequately fastened down, and a large air
conditioner attached to one of the tents fell on Josiah, causing
fatal injuries.
So you think it won’t happen to
you? Huh?
ARA Reports 1 out of 10
 Incredibly, one out of every 10 injury claims reported to
ARA Insurance Services results from a chair collapse.
 Most collapses involve metal folding chairs with plastic
seats and backs. Some accidents result from old, rusty
chairs, but even newer chairs can fail. Often, the rivets
are weak where the seat is connected to the frame or the
rivets rip through the plastic seat. (reprinted from ARA)
Table and Chairs Claims
 A guest sat down on a rented chair at a large event and the
chair broke. The guest alleges he tore his rotator cuff in the fall
and had to have surgery to repair the injury. The rental store
was not informed of the loss when the chairs were returned
and disposed of the broken chair after they inspected it.
 Chairs were rented for a meeting. A guest sat down on the
chair and the front leg snapped and broke off. The guest fell
forward onto her knees and tried to catch herself with her
hands. The guest allegedshe suffered from back pain and
headaches after the fall. The chair leg was reported to be
rusted. The rental store had recently painted all of the chairs
prior to this event and did not notice the rusted leg.
Table and Chairs Claims
 A section of a rented “tiki” bar and table was blown over by
strong winds and struck a guest at a party. The bar was
supposed to be bolted together, but it came from the
manufacturer without nuts attached to the bolts — they were
simply screwed into place. The rental store did not discover
the defect until after the accident happened.
 Tables that had been rented for an event were stacked up
against a wall. A mother was letting her child crawl around on
top of the stacked tables when the tables fell onto the mother.
The mother sustained minor injuries. It was never determined
who stacked the tables. A settlement at 50 percent was
reached due to the mother contributing to her own injury.
Table and Chairs Claims
 A customer had the rental store deliver some tables and
chairs to his home for an upcoming party. Some of the
renter’s furniture had been moved out of the rooms in
advance of the delivery, but the rental store employees
had to move several large pieces of furniture to make
room when they arrived.
 The rental store employees set up the tables and chairs as
directed and then the renter alleged the employees had
scratched his bamboo floors and wanted the floors either
repaired or totally refinished.
So maybe you are getting pissed
off and want to fight someone???
Now its getting serious…
Attorneys, gotta have them…
Attorneys smile
Hmmm…
See any similarities
Hmmm…
See any similarities
Lawsuit and the words “trust me”
The attorneys say that it is a fair
balanced judicial system…
The reality is the scales are tipped
against the business owner
When you are thinking you are
having a bad day…
Remember there are sharks in the
water everyday!
Consider today’s class your shark
net…
I HATE THE INSURANCE GUY!
• Availability of Markets
• Volume of Premium
• Claims
• Frequency
• Severity of Claims
Lack of Trained Supervision
Overloaded Inflatables
Not Tethered Properly
Sudden Deflation
Manufacturing Flaws
Lack of Trained Supervision
This is without doubt the number one cause of injuries. Being
"trained" to supervise an inflatable ride in operation often
requires nothing more than reading the manufacturer's
warnings that are posted on the inflatable itself (note that
this is not sufficient training for setting up and taking down an
inflatable). Many of them do -- but evidence of thousands of
emergency room visits each year from unsupervised
inflatables proves that not enough companies supervise
events and follow the posted rules.
Overloaded Inflatables
The most serious inflatable-related injuries tend to come
from the larger inflatable slides, and in almost every case
the inflatable was overloaded with more than the
manufacturer's maximum occupants. Just look at many of
the slide-related headlines, they often read something
like "9 Injured When Inflatable Slide Collapses." There
are no inflatable slides that allow nine occupants at once!
Reading through the actual news story almost always
verifies that there were far too many people on the
inflatable.
Not Tethered Properly
The most shocking and terribly news stories about
inflatables are when bouncers full of children are actually
picked up in a gust of wind and sent sailing through the air,
or even out to sea. You can see this hazard in action in
several videos, one in which five bouncers from a car
dealership go sailing over and onto a freeway. In addition
to the very serious but rare danger of airborne bouncers,
lack of tethering is one of the main causes of inflatable
slide injuries (usually combined with overloading).
Sudden Deflation
Rapid deflation of an inflatable is almost always caused by
some kind of power failure to the blower. Inflatables are
designed to retain their inflation even with numerous small
punctures and tears. But if a circuit blows, or someone
trips over a power cord, or turns off the blower as a prank
the inflatable will deflate relatively rapidly. This deflation
leads to great instability of the inflatable. Deflation is one of
the common causes of slide "collapse." Even if a large slide
is properly tethered, partial deflation can cause it to fall
over, spilling the occupants.
Manufacturing Flaws
In the last 8 years the manufacturers have improved the
quality of the inflatables design. In order to bring into some
states it has to pass approval from NJ, which has raised the
bar. Some minor injuries were indirectly caused by bouncers
without finger-safe netting, or without steps leading to the
entrance. Make sure that you are purchasing quality and from
a manufacturer that can show you that they have product
liability insurance in place.
Study design:
Retrospective case series
 The records of all children seen in the Level I trauma
center and subsequent fracture clinic for an injury from
an inflatable bouncer from October 2002 to March 2007
were reviewed. Parents were contacted by telephone
survey to provide information about activity, number of
children in the bouncer, presence of adult supervision,
and age difference of the children who were in the device
at the time the injury occurred.
Facts on injuries
 During the review period, a total of 4,367 children were
seen in the emergency room for trauma,
 49 (1.1%) sustaining an injury while in an inflatable
bouncer.
 The majority of inflatable bouncer-injured children were
male (74%) and the mean age was 7.8 (range 1.5–15)
years; 35% of the patients were between seven and nine
years old.
 Injuries occurred in either the upper (66%) or lower
extremity (34%).
Facts on injuries
 The most commonly injured area was the elbow with
supracondylar humerus fracture being the most common
single injury (22%; 11/49).
 Most injuries were minor fractures with only one open
fracture and only 14% requiring manipulation of a
deformity.
 A total of 21 families (43%) could be reached by
telephone. Among these families, all
injuries
occurred at home on a rented device.
Facts on injuries
 Adult supervision was absent in 9/21 (43%),
 The mean number
of children in the device
at the time of the injury was 5.4 (range 3–
11), and 11/21 (52%) had children of different ages
jumping inside.
 The two most common mechanisms of injury were
collision between two children (67%, 14/21)
and falling out of the bouncer (19%, 4/21)
Mechanical Bull injuries…
Abstract
We reviewed the cases of 30 patients presenting to the
emergency department over a four-month period with a total
of 31 injuries suffered while riding a mechanical bull. The
majority of injuries were sprains and contusions. The most
severe injuries included seven fractures, one dislocation, and
one fracture-dislocation. Three patients required
hospitalization, including one with a compression fracture of
C7. The majority (74%) of injuries involved the upper
extremities.
http://www.ncbi.nlm.nih.gov/pubmed/7316262
Is the bar open yet?
Glad you asked! Just a few here…
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General Liability (tax deductible)
Professional Liability (tax deductible)
Inland Marine (tax deductible)
Commercial Auto (tax deductible)
Workers Compensation (tax deductible)
EPLI
Health Insurance (tax deductible)
Life Insurance (tax deductible if death benefit paid to
company)
 Disability Insurance
What The Heck Is General Liability?
 Coverage is provided for claims of bodily injury or
property damage liability on your premises or at your
customer's location.
 Important Note: Remember that some policies may
exclude Errors and Omissions type claims related to
the delivery of your professional services.
 You may need excess coverage or umbrella coverage
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
What The Heck Is Professional
Liability?
 Professional Liability Insurance or Errors & Omissions
insurance protects you against loss from a claim of
alleged negligent acts, errors or omissions in the
performance of your professional services. This might
include claims of nonperformance, fraud or negligent
oversell.
Professional Liability
 Professionals are expected to have extensive
technical knowledge or training in their particular
area of expertise. They are also expected to perform
the services for which they were hired, according to
the standards of conduct in their profession.
Failure to Provide Services
 If they fail to use the degree of skill expected of them,
they can be held responsible in a court of law for any
harm they cause to another person or business.
When liability is limited to acts of negligence,
professional liability insurance may be called "errors
and omissions".
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
Abuse and Molestation
 Do you deal with children?
 Do you have attendants with your equipment?
 Do you have an indoor center?
 Do you have video cameras on all angles?
 Do you have a written procedures manual?
 Do you have training for sensitive issues?
Why Abuse and Molestation
Coverage is Important Today!
Training is key to minimizing
exposure!
Do I really need this coverage?
What is rule number one?
Hmmm…. Molestation
 It is a claim you can’t defend
 It is an open checkbook for your attorney
 It will probably ruin your reputation personally and as a
business
 It could financially bankrupt you defending your
innocence
 Defense costs start at $30,000-100,000
The are always around lurking…
Or Inland Marine if mobile in nature
Property or Inland Marine Coverage
 This provides coverage for your business property for
fire, theft, vandalism on premises, or if Inland Marine
while off premises
 Covers computers, office equipment, inventory etc.
 This does NOT provide coverage for equipment of
others rented or borrowed
 If you have a loan on it, it must have this coverage
 Don’t forget Business Income!!!
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
You need to think about this…
Commercial Auto
 This coverage provides liability, medical, uninsured
motorist, underinsured motorist, collision,
comprehensive, rental car reimbursement and
towing. Trailers also.
 Your personal auto policy has a “business use”
exclusion
 Make sure that you have non-owned/hired auto on
the commercial auto policy or general liability policy
Commercial Auto
 Make sure your agent gives you something in writing
that states your personal auto coverage protects you
while using your car in your business
 If you use your vehicle in the course of business, you
need to have a commercial auto policy. If you do any
delivery, if you are picking up customers etc. If you
just use your vehicle to go to do proposals to drive to
site, you can get a business endorsement on most
personal auto policies that will cover you.
Non-owned Auto/ Hired Car
 Hired auto coverage protects your business if you or
an employee rents a vehicle in the company name
and an accident occurs. Non-owned coverage
protects the company if an employee has an accident
in his or her own vehicle while on company business
and the employee’s personal insurance is inadequate
to cover the claim, resulting in a suit against your
company
 Could be included on General Liability
Make sure you add your trailers
Don’t overload
This is not considered tied down…
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
Workers Compensation
 This coverage is for employees
 Does not cover YOU
 Mandatory in most states
 Does not cover sub contractors
 World’s greatest saying, they are not
employees…….
Sure they aren’t….
IRS Agents laughing at you…..
Work Comp Coverages
 This coverage is used to comply with the Workers
Compensation Coverage required by your state law.
Under this requirement, an employee can be
compensated if he or she is injured while working for
you, regardless of your negligence as an employer.
Covered, Covered, not Covered…
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
Employers Practices Liability Insurance
EPLI Coverage
 Employment Practices Liability Insurance
 EPLI covers businesses against claims by workers that
their legal rights as employees of the company have
been violated.
 The number of lawsuits filed by employees against
their employers has been rising. While most suits are
filed against large corporations, no company is
immune to such lawsuits.
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
Example of harassment
Touching can be
turned around
It’s not always the guy doing it…
You’re Fired!
Types of EPLI Claims
Defense Cost From
Sexual harassment
Discrimination
Failure to employ or promote
Wrongful termination
Breach of employment contract
Do I really need this coverage?
What is rule number one?
You can’t be a little bit pregnant!
 Either you are covered or you are not!
Cry
What to do in case of an incident
If there is an injury involving an entertainment
device do the following:
 Collect inspect and preserve the item
 Preserve product in current condition
 Collect statements from spectators and
employees
 Take pictures
 Collect field records
 Collect product records
 Store in neutral site
 Notify insurer immediately
 If necessary retain counsel
 Consider CPSC rules
How long should you retain
documents?
Accident reports and claims= 7 years
Waiver= 7 years
Accident settled= 4 years
Accident not settled= forever
Contracts= 7 years
Employee= 3 years
These pictures represent possible
claims…
While it all starts out as fun…
Ends up with someone hurt
Because of something going wrong
You can buy the
correct insurance
policy, or…..
Or you can write the check for
damages and attorney costs…
What is a certificate of insurance?
• Evidence of insurance coverage's and limits
• Can show liability, umbrella, property,
commercial auto, and work comp
• It verifies that a certain insurance policy is in
effect for stated amounts and coverage and
names those insured.
Let’s look at what you need to see on a
certificate of insurance
Certificate of Insurance Notes
• You need to be named as additional
insured with all subcontractors
• Certificate holder does you NO GOOD
• Always ask for the endorsement
• Always ask to have certificate sent from
agent
Tips to minimize your exposure
 Have trained employees
 Follow safety guidelines EVERY time
 Have correct signage
 Have correct wording in your rental agreement and
contract
 Do not copy someone else’s waiver and contract from the
internet
 Protect stakes and generators with cones
Directions on what to do during an
event
• Good supervision is essential for making sure all inflatable users stay safe. These tips
will help you ensure that the event is as much fun as you had planned.
• A responsible adult must supervise the inflatable amusement rides at all times.
• Before being allowed to enter an inflatable unit, people should remove shoes,
jewelry, eyeglasses, hair clips, and other sharp objects that may injure others.
• Prohibit food, drink or gum in the unit.
• Don’t allow people to perform flips or engage in rough play inside a bounce house.
• Don’t let children sit or lie down while others are bouncing around them.
• Remove children from a bounce house once they tire.
• If an inflatable unit deflates, remove occupants immediately.
• If winds start affecting the structure, or if you see rain, lightning, or any other unsafe
condition, get everyone out of the inflatable, then turn off the blower motor until
conditions improve.
Items that have more claims…
Set up on sidewalk…
Who do you call?
Forms of Protection
All blue boxes would
Inflatable
Rental
Business Owner
represent all the
Owner
entities that would
Business that
City,State,
the event was
be named in a
County
for
lawsuit by an injured
Manufacturer
party
Manufacturer
Of Unit
Of Any
Accessories
Tents,
Generators,
Entertainment
Sponsors
So if there is a claim
for a covered activity
during setup, during
the event, or take
down, the policies
would provide
defense coverage for
the additional
insured’s