The Dangers Of Associations Offering Insurance
The many reasons why every martial arts instructor should be careful before committing to insurance with their governing body
The benefits of having your association manage and issue you with instructor insurance are often clear to see. The price usually ranges from slightly less to slightly more expensive than a policy from a licensed insurer, and the ease of use when combining with membership means just one renewal date, and one annual outgoing too. Easy, right?
In essence, yes. The problems start to arise when you scratch a little deeper than the often two-bit websites that represent the organisations offering instructor insurance. As you will have already no doubt found out, arranging instructor insurance is a tricky thing, given that there aren’t too many insurers able to cover our very specific arts.
Take it from us – finding cover for an association is like shopping for instructor insurance on steroids! It’s incredibly difficult, and immensely expensive. Our association group cover policy alone is estimated to run into six figures this year, and this in it’s self poses a question;
How can you be sure the insurance you’re being offered is genuine and sound?
Insurance is a tricky thing to get right, and it’s also a very heavily regulated area of business (for good reason). Arrange the wrong cover, or confirm the wrong principle to contract, or exclude any other material facts and you could find that insurance policy that cost you £100 this year is worth no more than the paper it’s printed on. It’s immensely important you’re clear exactly what you are and are not covered for under a policy, and this is the responsibility of your association.
Whilst it can be legal to provide instructor insurance as part of membership, selling an insurance policy without authorisation is not. Further more, when many associations re-sell branded policies from insurers such as MartialGuard and the like, it becomes illegal. The insurer likely has no idea what so ever the person creating the policy online is not the person for whom the policy is intended.
The problem for you as an instructor is you won’t know exactly what material information was declared on your proposal. A typo in your name, a mis-match in your date of birth, a missed tick box on a previous insolvency – it can make the critical difference.
Further more, you have absolutely no recourse with the insurer should you need to make an amendment, or should you have a falling out with your association AND, to ‘top the cake’, we’ve seen lots of instances of association’s buying from another insurer and then ‘whacking’ a great big fee on top for the trouble – and the only person loosing out is you.
The insurer makes their money (albeit it without any knowledge of what has gone on) and the association make theirs too. You, on the other hand, end up paying extra cash for a policy that is all but useless.
When an association offers a policy from a named insurer like MartialGuard – you should really be declining and purchasing directly through the insurer yourself. Likewise, if an association offers cover through a ‘group cover’ policy, take a moment to ensure the policy really exists and isn’t just another named policy resold on their headed paper.
Of course it’s not every association doing this. Some of the larger organisations, such as ourselves, have a genuine group cover policy that can offer you adequate cover alongside your membership.
In this instance, it’s well worth taking the time to check exactly what IS and IS NOT covered under the group cover policy. It’s worth bearing in mind that as a group cover policy, the association is taking a risk on assigning you to their policy. If you claim, they claim. For this reason, and to ensure compliance with the law, insurance has to be issued with membership.
If you don’t have a particularly good relationship with your NGB or if they often employee politics or squabbling to resolve issues, make sure you don’t find yourself in a position where it’s used against you.
As an association, we only use an FCA licensed broker for our insurance provisions and it’s managed by a specialist broker team. Further more, our association director is within the insurance industry so we understand better than most how to accommodate risk properly.
If you’re looking for instructor insurance, we welcome you to take a look at the insurance we can provide with membership however we of course still recommend you take your time to ensure you’re happy with what we’re providing, in light of the above.