Spring means air show season! The experience of the cross-country flight, the traffic at a high-density airport, and the crowds come with many thrills as well as some exposures. It is important to understand the risks associated with air shows and how you can be prepared to protect your assets.
Whether you are the airport authority, FBO, or a sponsor or organizer of the event, a separate insurance policy is necessary to properly cover all operations taking place. Air shows and special events are excluded in a standard airport liability policy by exclusions which refer to air meets, contests and exhibitions.
Airport liability coverage provides payment for bodily injury and property damage caused by the named insured’s negligence. At an air show, this is primarily covering slip and fall incidents on the premises. The airport liability policy provides settlement coverage in suits brought against the named insured, including coverage for defense of the lawsuit.
Many policies will have an occurrence limit with an aggregate total. An ‘aggregate’ limit is the total amount that could be paid during the policy period. If the event is more than one day, it is increasingly possible to have more than one occurrence so reviewing both occurrence and aggregate limits is important. It is also critical to make sure that coverage is provided on an occurrence basis and not claims made as it is highly likely that with the short window of coverage, claims will be reported after the effective dates of the policy. You want to be sure the policy is not restricted to only the airport premises, means, and by-ways. Review policy wording carefully and ask for clarification to ensure the policy does not exclude coverage for incidents involving aircraft used on behalf of the air show. This is a common exclusion typically addressed through an endorsement known as non-owned aircraft coverage. Approximately 95% of air shows choose limits from $1,000,000 - $5,000,000, however higher limits are available, typically up to $10,000,000.
In order to ensure that your policy is not “first dollar” for exposures created by others, it is important to make sure that vendors, participants, and suppliers carry their own liability insurance policy and endorse the air show as an additional insured. We recommend vendor carry coverage limits of no less than $1,000,000, in most cases, but larger operations such as carnival-type events should carry higher limits due to the nature of that business and increased exposures. A certificate for each participating vendor should always be required in advance, due to the short exposure period.
Exposures that need particular attention or specific insurance, covered through an endorsement or separate policies include:
1. Products Liability - food sales and aviation services provided are the most common exposures
2. Hangar Keepers Liability - aircraft in the care, custody, or control of the air show and organizers
a. As with products liability, this is normally an incidental exposure as those functions are generally handled by a separate service provider.
3. Pyrotechnics / Fireworks Liability - Who is operating? Is a company providing this service? Are they licensed and insured? Are volunteers going to be assisting?
4. Bleachers / Grandstands Liability - coverage for loss if bleachers collapse resulting in injuries from falling, etc.
5. Non-Owned Auto Liability – coverage for vehicles operated around spectators and aircraft by vendors and participants
6. Property Insurance - Rented, leased, borrowed equipment such as radios, generators, golf carts need to be protected against loss, theft and damage often requiring a separate property policy.
a. Liability involving any equipment will fall under the air meet liability policy but repair and or replacement of the equipment itself is covered under the property policy.
b. These items need to be listed to including the number of that item and a stated value. Do not simply state, “Misc. Equipment” to cover several items.
7. Liquor Liability - The provider of liquor and alcohol products needs to have a liquor legal liability policy. Many air show events will have VIP tents or chalets where alcohol is provided to their invited guests and not open to the general public. Providing an alcoholic beverage at no cost is covered under host liquor coverage. However, if the sale of liquor and alcohol are involved, liquor legal liability would be required for the vendor and air show operator.
8. Weather - Several types of weather coverage options are available and are essential for any organized outdoor event. Given the nature of the coverage, this needs to be bound well in advance of the actual event.
The majority of incidents at air shows do not actually involve an aircraft. The most common, and generally most costly, are grass fires, trip and falls and vehicles operating within the air show area causing bodily injury and property damage.
Volunteers are often key to the success of air shows. A good air show volunteer is a properly trained volunteer. However, volunteer accident coverage is available at a minimal premium and provides medical expenses and accidental death and dismemberment coverage in case they injure themselves during the course of their volunteer duties.
Insurance coverage for air shows will vary depending on the size and length of the show, the organizer and the performances, as well as the required limits. AssuredPartners Aerospace will review the requirements and specifications set forth by any contract, and more specifically, ensure that our clients are not picking up liability for exposures created by the activities and operations of others. To learn more, contact our aviation professionals.