Insurance

David you are so right, as much contempt as have for how Matt acts on the web, even I have enjoyed standing around a fire in the paddock with a beer debating him. But that does not excuse his ridiculous, insulting behavior on these web sites.
 
I know guys -- it was amazing to me when I learned the infamous Matt Berg was the really nice guy I hung out with at Roebling during school. Matt, you sometimes make good points. You just got to work on the cipherin' and persuadin' skillz.
 
And in my experience there are virtually no spectator Solo events. Every one I've been to or been aware of (excluding the Solo National) has been a non-spectator event in which case everyone on the property is required to sign the waiver to be at the site. So assuming the waiver offers the protection against all but gross negligence that both you and risk management seem to agree with, why would Solo have significant liability exposure? Now for those cases where the event is advertised as a spectator event the insurance sheet does call out an additional charge which could theoretically be applied to the additional liability exposure.

Based on how the process has been described to me there is a single policy negotiated with the insurer based on ALL of the club activities which includes club racing, solo, rally cross and so on. The negotiation takes into account event types, past history of number of events, car counts, participation and previous claims and issues. The insurer then provides a total for the ENTIRE policy and then risk management submits a proposal to the BOD that approves the insurance fee schedule. That last part is where there is some potential disconnect as the distribution of fees is supposedly determined by risk management's perception of where the expenses are derived from. In theory those estimates should be in line with the insurers assessment but the explanation I have been given implies the actual quote does not contain enough detail to verify this.

Finally, Matt you've commented to others that their assessment of liability risks is based on theory more than actual numbers. I would challenge that you are also making assumptions and would guess based on some of your comments that you have relatively little experience with Solo events and are ill equipped to make judgements on liability. For example, in my experience it is far more likely for a car to endanger people at a club race than a solo event and when it does happen the people at a solo event are signed on a SCCA waiver while club racing has a significant chance the person is not signed on any waiver, or only a track waiver. But beyond that the layout and safety assessments of solo course has guidelines to limit that type of exposure and SCCA's track record of following those guidelines provides data used during the risk assessment.
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Matt, This is exactly what is being questioned once you get by al l the other BS....The club buys a block of insurance and then through MR Lyons and a BOD evaluation those fees are divided across the different business modules in the club. My point and I believe others point are that the burden is being overly paid for by club racing. That is reflected in the fact that the is NO liability fee being charged to SOLO in the insurance forms that I posted the link to.

Next let me say, SOLO is not a spectator sport by nature but it is held in open parking lots that have little control over who walks up and becomes a possible hazard. I have requested an insurance quote from a major company for my business to hold a private RR and a private solo. I hope to get an answer back in the next few days. I was told either event would have a liability policy on them.
 
Joe, last time, but I will try again. The price of the block of insurance is based on risk. Risk arises from teh activities involved. Some portion of the price of the block of insurance comes from Solo. We don't know what, and that number is set by the insurer not the SCCA.

If the SCCA is charging a higher percentage of overall insurance costs to the road racer than the amount of premium generated by road racing risk, then you guys have a point. If not, you don't.
 
How much was paid out to the families killed by a flying wheel at Charlotte and MIS?[/b]
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Not sure but I personally know someone who was hit by debris at a roundy pounder and came up empty handed sfter trying. Again, all depends on gross negligence.

Solo events are by definition NON-SPECTATOR.[/b]
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That's not true. Read the rate card. I walked into one without even a question asked. Never showed my license or any form of ID. Nothing. As far as there being specatators versus waiver signing members, I'd say there are more of the latter at a club racing event where you have to be a member to get into a lot of events and the rules, restrictions and security are far greater. And how many spectators do we get at a club race who aren't members? 3? THere's a heck of a lot of non-members walking around solo events. I went to one at a park in Ft. Lauderdale. Not only were there no fences but there were two soccer fields and probably a couple hundred people participating in a youth soccer tournament not more than 50 feet away from the blacktop. I doubt any of them had signed a waiver.

The video posted earlier demonstrates NOTHING unless and until you provide evidence that this was an SCCA-sanctioned event. [/b]
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Now that's nonsense. Why? You talked about probability. What does it have to do with who put the event on? Conversely, show me an SCCA club race where a car flew into a crowd. THat was the third or fourth video I've seen just this month where a car went off "track" on an unrestricted, unfenced solo type course with spectators in succeptible areas. Never seen it in club racing although I heard there was a close call at a NEDIV race this year. The fence apparently did its job. Unfortunately most high school parking lots don't have that type of restrictive protection.

Head-to-head competition increases the likelihood of a medical payout. How many drivers get transported to the hospital at a Solo versus Club Racing? Use your experience with the Club as the basis of your rants.
You bring up the subject of gross liability. I only mentioned that H2H and high speeds increase the probability of a payout and the amount of the payout. Evidence? Have you EVER been at a race? Have you ever been at a Solo?[/b]
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Again. I'm not talking about medical. There is no legal exposure there. Legal expenses are not capped nor is there any limit on coverage for legal fees. Without gross negligence, the risk is dramatically reduced.

Think about it... which has a greater likelihood of generating a medical claim - a collision at 30MPH or a collision at 140MPH? Which is likely to cause the greatest damage to the driver - a 30MPH collision or a 140MPH collision?[/b]
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A medical claim? Sure, I've already agreed. A capped medical claim versus an unlimited legal liability claim is what we're addressing. Damage to the driver is irrelevant. Damage to the insurance company is what you have to look at. I have seen maybe ten serious accidents since I first started with SCCA in the 60's and one of them was me. I'd bet if you took all the claims from those incidents, three of which were fatal, the claims wouldn't add up to a single bathroom slip and fall claim that went into litigation.

As for the issue of medical insurance being secondary...Hardly! Many people do not have medical insurance - look around in the paddock. Medical insurance often has annual caps on payout. It has co-pays/deductibles which, I believe, the SCCA insurance pays. It has lifetime caps. It does not cover LTC beyond 30 days (typically). April 2006, we had a corner worker fall out of a tub and break his leg. He just (Dec 2006) had more surgery. Given the nature of his injuries - he is entitled to LTC coverage. His medical reimbursement policy DOESN'T cover that, but, I believe, SCCA's needs to.[/b]
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Exactly my point. First, that tub accident will likely cost more than most on-track incidents and the probability had nothing to do with fast cars or H2H competition. Is a club racing participant more likely to fall in the tub than a solo participant? Second, can that person sue? No.
 
Conversely, show me an SCCA club race where a car flew into a crowd. Second, can that person sue? No.
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Road Atlanta several years ago during the Runoffs. Two GT cars got together in turn three ripping the flares from both. Cars became open wheeled and ramped over tires, over the substantial dirt wall, over the fence, and into the parking area on top of a worker's car. No significant injuries to people, but you wanted an example. Second, anyone can sue anyone for just about any reason anytime. Whether it makes it through court is another matter. In the mean time, attorneys, courts, and the associated fees are involved.
 
Joe, last time, but I will try again. The price of the block of insurance is based on risk. Risk arises from teh activities involved. Some portion of the price of the block of insurance comes from Solo. We don't know what, and that number is set by the insurer not the SCCA.

If the SCCA is charging a higher percentage of overall insurance costs to the road racer than the amount of premium generated by road racing risk, then you guys have a point. If not, you don't.
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Jeff I am not dense, I get waht you are trying to say but read Matt Rowes post and think about what he is saying. The liabilty risk for SOLO is not zero but that is what they effectively are being charged. That is on the SCCA insurance rate sheet. Second even if the divsion of the rate is determined by the insurer there is still a problem The insurer is the employer of our risk/legal counsel.

Would it not take all of this speculation out if these numbers were properly disclosed to the membership that pays them?
 
Not sure but I personally know someone who was hit by debris at a roundy pounder and came up empty handed sfter trying. Again, all depends on gross negligence.[/b]
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Then I would suggest that this person neither had out-of-pocket medical expenses nor filed a law suit.

I walked into one without even a question asked. Never showed my license or any form of ID.[/b]
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That would make you a trespasser.

Nothing. As far as there being specatators versus waiver signing members, I'd say there are more of the latter at a club racing event where you have to be a member to get into a lot of events and the rules, restrictions and security are far greater. And how many spectators do we get at a club race who aren't members? 3? [/b]
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Summit Point draws between 300-1000 spectators per SCCA race weekend.

Not only were there no fences but there were two soccer fields and probably a couple hundred people participating in a youth soccer tournament not more than 50 feet away from the blacktop. I doubt any of them had signed a waiver.[/b]
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1. I doubt your estimate of distance. 50 feet is about the length of a 1950s-era house. No qualified solo safety steward would allow the course that close to civilians.

Now that's nonsense. Why? You talked about probability. What does it have to do with who put the event on?[/b]
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WHO puts on the event GREATLY influences both the probability of a claim and the distribution of payouts from that claim. The video you showed is striking proof of that since it almost certainly is not an SCCA event. The operational rules influence the likelihood of an event. The safety rules influence the distribution of payouts.


Conversely, show me an SCCA club race where a car flew into a crowd. [/b]
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Jim Epting Flying Into Crowd Area On Main Straight

Summit Point Grandstand Story

THat was the third or fourth video I've seen just this month where a car went off "track" on an unrestricted, unfenced solo type course with spectators in succeptible areas.[/b]
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Any of them SCCA solos? If not, your "evidence" is sucking wind.


A capped medical claim versus an unlimited legal liability claim is what we're addressing. Damage to the driver is irrelevant. Damage to the insurance company is what you have to look at. I have seen maybe ten serious accidents since I first started with SCCA in the 60's and one of them was me. I'd bet if you took all the claims from those incidents, three of which were fatal, the claims wouldn't add up to a single bathroom slip and fall claim that went into litigation.[/b]
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1. So you freely admit that your rant has no basis in fact? You don't have any idea what the claims experience is for SCCA, yet you are convinced that the liability from Club Racing is less than Solo?

2. Damage to the driver IS RELEVANT. If the driver is injured because of negligence - say for example improper tire wall construction and the track has been "approved" by SCCA, then the SCCA can be sued. The waiver doesn't mean squat if negligence is involved. Gross negligence only means the award will be larger.

You obviously are correct. SCCA is screwing the Club Racers by overcharging for insurance. In fact, I believe they intend to readjust the insurance rates so that anyone with the letters G,B,R or E in their last name will pay 100% of the insurance charges. <_<
 
Video?? I missed video?? Were there chicks in it?? THATs what this thread needs!!!

Grid Girls!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

But the sad part is our INSURANCE regs won't allow us SCCA types to have this:
 
Joe, I agree, having the SCCA disclose the premium paid to the insurer and the manner in which it is calculated would be helpful. Has anyone asked for it and been turned down?

Somewhere above I posted about why there may not be a premium for liability coverage for solo. The insurer may consider the risk low enough that they offer that coverage for free as part of the overall package sold to the SCCA. Or, SCCA may simply not carry CGL for Solo events since the risk is (possibly) low. There's more to it than "there's no charge for liability insurance for Solo participants thus road racers are getting screwed."

Last, is it possible that the region putting on the event is picking up the tab on the CGL coverage for a solo event? I have no idea, just a thought.
 
Video?? I missed video?? Were there chicks in it?? THATs what this thread needs!!!

Grid Girls!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

But the sad part is our INSURANCE regs won't allow us SCCA types to have this:
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Jake I don't think it's the insurance folks that won't let you have that....:)
 
I propose that no one posts any more to this thread. Let Joe & Matt get THEIR facts & then THEY can post THEIR factual results.

Who will second this?

I be gone ;) & I ain't reading any more of this I supose this & that.

David
 
Come on, David...I've been busy but I want to get another kick in before the holidays.

Tuning back in here…I see that the speculation is still in full 'speckle'. Any of you read the story of the "Blind Men and the Elephant" ? Here's a poetic version by John Godfrey Saxe…take a moment and read it…we'll wait for you…

http://www.cs.rice.edu/~ssiyer/minstrels/poems/1179.html

…Back already ? Good. Enjoy that ? Any of that sound familiar ? "Don't take an elephant's toenail and turn it into a Croca-dillo-saur". Matt has attempted to do that, and seems to take umbrage when people point that out. Nobody here…NOBODY…has any understanding of how the insurance costs are apportioned. It's pure speculation to say that "Solo gets a free ride" or "Pro gets a free ride", and there is no reason to think that anyone could discern it from reading the financial statements.

Civil questions to ask of your Director, if you're a member and you're concerned about this:
1.)Does Pro make a per-event or per-sanction payment to SCCA Risk Management, just like Club Racing Regions ? If not, are they acquiring any coverages thru the 'headline act' at the venues on their schedule ? (for example – if they're on the bill with ALMS, do they have a deal with ALMS to be included on the ALMS bond ?)
2.)What role does the Pro event PROMOTER play in providing venue liability coverage ?
3.)What is the loss-history of Solo, and is it so low that the liability coverage cost is insignificant ? It doesn't matter if we think it's dangerous or safe…it's all up to loss-history, and a bunch of actuaries sitting in a cube farm someplace.

Now…Matt claims to have done "detective work"…and he's talked to "Deep Topeka", inside HQ…and I giggle:

Down to brass tacks... there is one policy. Policy OGLG21749771 managed by Arcadia Insurance. The carriers listed are Ace Insurance and Markel Insurance. I would assume from what I've read that Markel provides the health policy while Ace provides the liability coverage, or possibly ACE is just a reinsurer although I'd doubt that given they're listed on the policy as a provider. [/b]
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Well…no, actually. There are several policies that provide the coverage for a Club Racing Event. He's cited the Policy number for 'General Liability'. Impressive stuff, huh ? He's missed the "Participant Accident" policy, and the "Excess/Umbrella Liability" policy…separate policies…separate policy numbers. There are other carriers too, in addition to Ace and Markel. Oh…and he got the primary 'producer' – Arcadia – wrong. (you seem to have a problem with spelling, as we've seen before). It's "Acordia". Not particularly hard detective work…ALL that information - and more - appears on every insurance certificate that event organizers get from SCCA Risk Management. They're produced by the boat-load for each race, and basically handed to everyone who asks for one – the track, the service providers, the Stewards, etc. I'm sitting here looking at a stack of them. He's YET to furnish any information that ISN'T commonly available…and what he's gotten, he's gotten wrong. But…HE KNOWS "DEEP TOPEKA" !!!! Cool, huh ?

Now…just catching up on "old business" –

And to you John... Please cite one thing I've said that isn't factual. You ask for "proof" and I've supplied the data and information. [/b]
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and then…

We're being ripped off guys and John is an agent for that ripoff. What he says is only to protect that operating procedure and continued support of non-racing functions and individuals without disruption.[/b]
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Whoa……Coooool…..I'm part of a conspiracy. I'm working on my diabolical laugh. MP3's posted soon. Matt being "factual", obviously…but it sure as hell sounds like conjecture to me.

Just wondering if anyone knew that solo didn't even start paying insurance until the late 90's. They had a free ride for many, many years on club racing's nickel. And John knew that. Funny he didn't mention it. [/b]
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Wow…I knew that, huh ? That's a mighty big accusation. Care to back it up, Matt ? I've never competed in a Solo with ANY sanctioning body, never even 'worked' at a Solo. My only Solo exposure has been "stopping by on a Sunday morning to drop off tires or parts to a racer who was testing stuff". Nice fabrication, Matt.

Then there is also this:

THen there's one more deal. Solo has no reconcilliation for their events. That's an interesting thing because it allows regions to submit whatever they want on their audits unlike club racing which must submit a list of entries and starters. [/b]
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Now…I don't know jack about Solo…but it took me all of seven (7) (siete) (VII) minutes to go look at the SCCA insurance handbook and find the post-event audit forms that the Solo guys prepare. As I've mentioned, I've done post-event audits for races a lot, and the forms and procedures look remarkably similar. Matt is just wrong…again. From listening to our own Region Treasurer review post-event Solo audits, I know that Topeka does require them, just as they do from Club Racing. Club Racing does NOT require "entries and starters" as part of the post-event insurance and sanction audit…I oughta know…I've submitted a bunch of those audits. A little basic research would have helped Matt, but it's obviously more fun to just make stuff up. And this:

Now to the real BS. I say the club abuses club racing in reference to insurance. John says "who cares, it's cheaper than NASCAR". Nice argument. [/b]
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Didn't ever say that. Nice fabrication…again. ISC uses the same insurance underwriters that SCCA does. A limited number of insurance providers write coverage for motorsports.. They price the policies based on the coverage and the loss histories of the types of events. The "NASCAR insurance doesn't fit" statement is a non sequitur.

And then finally…

First, if John were smart he would note that Sarbannes applies to public companies. I simply relayed the theoretical principles of the proposed act to a 501C as did the Harvard Law Review. THe fact of the matter is that the act became immediately effective in July of 2002, before the Fran Am filing and the act had been scratched out many years before. Legal analysts didn't start examining it only after it become law John. And if you want to call Erik Skirmants and ask him about the brief I sent him, go right ahead. The principles of Sarbannes were being bandied about since the early 90's. [/b]
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Nice attempt at a squirm. Read the original post – trying to take credit for an advanced warning. Now, it seems, he just "simply relayed the theoretical principles…". Oh…just the theoretical principles…not anything specific...just generalities. Nice dodge. As to it applying to publicly traded companies…yeah…then why did you bring it up in the first place ? Why not include 6-sigma or the Taft-Hartley Act, since you were on a roll ? You might as well have cited the Yale Journal of Public Health, the catalog of the Library of Congress…and One-Hour Martinizing, too. If you're going to pile it on, always pile DEEP. The actions that precipitated the Fran-Am filing happened well before SOX was enacted…but HEY…might as well take a shot at taking credit for an advanced warning, huh ?

Try harder, Matt. It's fun to sit here and shoot torpedoes into your statements, but after a while it's just "wasting ammunition". The SS Mattberg has a heavy list to starboard and the bow is underwater. Why waste more torpedoes ? We all look forward to the inevitable "gas explosion"…when the sea water hits the boilers…scheduled for the next time Matt hit "post" on this thread. It's the holiday season, and he's the "gift that keeps on giving".

No opinions will be changed by this thread…but maybe some will get an idea of who is a "credible" commenter and who is a "non-credible" commenter. You all can decide.

Outta here. Building a new 'old' tow vehicle…and got 3 race cars to prep for spring. Happy blathering. Class dismissed.
 
The key to all of this:

3.)What is the loss-history of Solo, and is it so low that the liability coverage cost is insignificant ? It doesn't matter if we think it's dangerous or safe…it's all up to loss-history, and a bunch of actuaries sitting in a cube farm someplace.
 
OK,

Just another dumb question from the peanut gallery. If (and I say if because insurance companies give nothing for free in my experience) the insuance company "gives" the Solo insurance for free under the blanket SCCA Club Racing policy, does Solo pay for any of the claims that happen during their events?

The initial questions remain after all these pages. Is Club Racing paying for Solo's and/or Pro's insurance? Why isn't that information readily available to all of us? Where is the money Club Racing generates going, and which divisions are making and/or losing money? We need these answers to figure out what direction our club is heading IMHO.

Mark
 
Mark, it would work like this. If there was a loss at a Solo event, the insurance company would pay. The next year at premium time, the insurance co. would raise the premium due to the loss experience. So, the insurer (and not the SCCA) would pay initially, but we then would later on via higher rates.
 
Ok

My poorly worded questions work against me again! I understand what you are saying Jeff, but doesn't that mean that Club is absorbing the rate increases caused by any claims paid for Solo incidents? That in itself seems wrong to me. BTW, I have nothing against the Solo program, as I ran in it for 7 years before going Club Racing. I just want to see equal $$ distribution of costs so each program can stand or fall on its own merits to the club.
Hopefully I asked the right question this time!
Thanks for everyones imput, we are all learning things from this discussion.
Mark
 
Mark, no problem and my answer was garbled, so I fixed it.

To answer your question, if we are covering both Solo and Road Racing in one policy (which I don't know for sure), then when Road Racing causes a loss that causes a premium increase that we all pay for and when Solo causes a loss then that causes a premium increase that we all pay for.

Where we MAY have an issue - and Matt et. al. have not been able to show any numbers establishing this -- is if we (road racers) are being charged more $$ to cover losses/premium increases caused by Solo.

No way to tell on this until someone gets informatoin from the SCCA on the loss experience for Solo and Road Racing, and how it has affected premiums. It is entirely possibly that Solo has had NO losses over the years, or such infrequent ones that the premium related to solo events is miniscule. Entirely possible.
 
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