• Loss  does not include fines or penalties imposed by law.
  
  It is important to note a Directors & Officers policy responds to claims made personally against the Directors and Officers of an organisation for "wrongful acts".
  
  As with Professional Indemnity insurance, Directors and Officers insurance is a "claims made" policy.
  
• Association Liability:
  
  Association Liability insurance is a policy offered by some insurers which can be described as a policy for incorporated associations which combines the protection of Professional Indemnity (excluding bodily injury) and Directors and Officers insurance under the one policy document.
  
  As in Directors and Officers Insurance it excludes any claim made which in any way involves injury, sickness, disease or death of any person, or damage to property; but in edition to providing protection to the individual directors and officers it also provides protection to the legal entity itself.

To assist in understanding the protection provided by these insurances take a look at an event to which each policy would respond:

1. A football game commences without the goalpost padding in place.  A player runs into the goalpost and is seriously injured.  A negligence claim would likely result as a duty of care exists to provide safe facilities to play the game; by not applying padding this duty of care has been breached, and someone has been injured as a result of this breach.  A Public Liability policy would respond to this incident.
2. A coach decides his inexperienced players should undertake some tackling practice. He makes no enquiries as to what tackling experience they have, nor gives any instruction as to how tackling should be done.  He also matches the 100kg "bruiser" with the 70kg "seedster."  The speedster suffers spinal injuries.  Again, taking into account the duty of care as outlined above, a negligence claim would likely result.  As this is a clear example of error or omission of professional duty as a coach, a Professional Indemnity Policy would respond to this incident.
3. A sporting organisation's Board of Management, desperately keen to grow their sport, decide they need improved facilities and embark on a $100,000 facility refurbishment.  Inappropriate planning and research was done prior to refurbishment, and when the creditors are not able to be paid they decide to hold the Directors and Officers personally liable.  

As this was neglect, error and omission by the Board members whilst acting in their capacity, a Directors and Officers Liability policy and an Association Liability policy would respond to this incident.

At IEA we're often asked what cover does sport need.  In the case of Public Liability insurance it is likely the sport will be required to have this type of coverage for the purposes of incorporation or to use Council property.  Apart from these reasons, it is generally accepted the risk to all participants resulting from not having Public Liability cover makes it an insurance sport cannot afford to be without.  Professional Indemnity and Directors & Officers insurances are not taken by the same proportion of sporting organisations, but with the frightening trends in litigation, more and more sports are buying these covers.

Can sport managers expect administrators, coaches, referees and the like, many of whom are volunteers, to put their personal assets on the line with no protection?  At IEA we believe this answers the question of what cover sport needs.

Insurance protection is only part of the overall risk management program.  Sport managers must aim to prevent the undesirable events occurring, not just provide the financial safety net once they have occurred.

At IEA we're committed to working with the sport's management to develop the best fit risk management program.  For more information about how IEA can help you, please contact your nearest IEA Sport office.

By Rod Hughes National Sport Risk Manager  
 IEA Brokers Pty Ltd.

                                                                          Winter1998

IEA has offices in every state.  
National freecall number 1800 SPORT 1 
                                   (1800  77678  1)
Email:info@ieasport.com.au

Disclaimer The information provided in this Email and on the IEA web-site is to be used as a reference only. IEA accepts no responsibility for the accuracy of the information or your reliance upon it. The views of contributors are their own and do not necessarily represent the views of IEA

    (Click Here For Details)