Editor's Note: In the first edition of our investigation into racing insurance we took a look at who pays the bills when someone gets hurt. There is another dynamic to insurance regarding property (both for the racer and the track). We'll take a look at how you can protect your investments in this installment.
There was something about the way the statement hit my ear. An announcer friend of mine advertised that his business now insured race cars. Insuring race cars? Insuring something that is destined to get damaged? Yes, it sounds odd, but obviously no insurance company is going to pay for you to re-stub your car (although that would be pretty awesome, wouldn't it?).
What those insurance companies will do is insure your investment away from the track. An accident on the way to the track or a catastrophe at the shop can be just as costly as getting involved in a five-car pileup, so it's important to know your options in finding protection. Just like health insurance, you'll want to find out what your existing insurance covers, and what it doesn't cover.
We turned to our friend from Tomahawk Speedway, Andrew Bartelt. When he's not promoting the track and making pulled pork nachos, Bartelt is running his insurance agency in Central Wisconsin. He is the one who opened many eyes by letting everyone know about the insurance options available for race cars.
“Most homeowners' policies specifically exclude vehicles and their parts – heads, intakes, gaskets, or even a set of tires,” Bartelt explained. “If you buy tires for your car and they're under the Christmas tree and the house burns down, they won't be covered because they're meant to be bolted to an automobile.”
Bartelt said some drivers do believe their racing equipment is covered by their home owners' policy. Just like the health insurance policy, it's important never to assume that something is covered. If your insurance agent says your investments are covered, it's important to have them show you specifically in the policy where it is. It is also important to check the policy on your shop if you are working on the car away from home. Some cover just the building itself.
If your home owners' or shop policy does exclude your race team's products, there are additional policies to make sure things are covered. Most insurance agents will be able to help you locate a policy.
“Let's start off with the shop. If a person has a commercial policy, more specifically a commercial garage policy, it's going to pick up all their vehicles and their parts,” Bartelt said. “A lot of drivers do their shop out of their home. You'll want to have a commercial policy. Many of the policies we sell come with a spare parts policy. So you might insure your race car then get extra insurance for spare parts. That's where you can get coverage for that stuff in your garage if you don't have a full-blown business policy.”
In addition there are comprehensive policies available. These policies protect the race car away from the shop, as well. In fact, Bartelt says most of these policies cover your car everywhere except the race track.
“If your garage burns down, the car is covered. If you lose your trailer and it's bouncing down the highway, the car is covered. I believe it even covers you in the paddock as you're waiting to go out,” he said.
These policies can be crucial against theft as well. There have been instances of trailers and race cars being stolen from shops, at race tracks, and in other places. A comprehensive policy can provide protection.
Much like the additional health insurance, the policies are not outrageously priced. Bartelt said there are many different levels, as well. “The sky is the limit. If you're going to do a $35,000 to $40,000 Super Late and $10,000 to $15,000 in spare parts…it will be about $400 a year.”
How a Track Protects Itself
In the last installment we talked about track policies as it pertains to insurance. A track's policy is not just in relation to medical insurance. Most policies are based around that coverage and coverage for their investments on the property. However, there are some other aspects that tracks can add to their menu.
“There are several areas of insurance available that track owners/promoters should consider,” said Steve Sinclair from K&K Insurance. “Promoters also have exposure to property damage to official vehicles like ambulances, pace vehicles, wreckers, push vehicles and the like. A good motorsports liability policy should provide coverage for this as well. Because these are 'autos,' coverage would normally be excluded from a standard General Liability policy.”
“Other standard business insurance should be considered as well: Property insurance to cover damage to the physical structures; Business Auto to cover registered road vehicles owned by the business and perhaps include Non-Owned & Hired Auto Liability to cover employees using their vehicles for company business; Crime insurance to cover theft, disappearance, and destruction of money and securities; Inland Marine which provide coverage for mobile equipment like graders and mowing equipment to things like computers and timing equipment.”
In addition, tracks can protect their investment in non-tangible investments, such as their purse and promotions.
“Another key exposure that requires special coverage forms is Motorsports Errors & Omissions,” Sinclair added. “This provides coverage for disputes involving timing and scoring or rule violations and resulting disqualification. Most companies will provide an occurrence limit of $1,000,000. In addition to standard coverage, a promoter may want to consider specialty coverage like Event Cancellation/Weather Insurance.”
Sinclair said what is most important for the track (for the overall policy) is for the promoters and staff to review the facilities. Making repairs when damage or defects are discovered can be critical to defending a policy and in keeping rates from going up due to extra loss.
“They should keep maintenance logs that track both their review of the facility and their repair work as completed,” Sinclair said. “And, they all should definitely have periodic staff meeting, particularly prior to each season opener) to go over procedures and to discuss emergency protocol.”
Sources
K&K Insurance
(800) 637-4757
www.kandkinsurance.com
Bartelt Insurance
(715) 298-3255
www.barteltinsurance.com
The post Everything You Need to Know About Racing Insurance (Part Two) appeared first on Hot Rod Network.
No comments:
Post a Comment