don shields district insurance officer 9780 may 2011

Don ShieldsDon ShieldsDistrict Insurance Officer District Insurance Officer

97809780

May 2011May 2011

EarlyEarly History of Insurance History of Insurance IndustryIndustry

• Ancient Chinese 3000 BC – share load, & 750 BC Ancient Chinese 3000 BC – share load, & 750 BC concept of “General Average”concept of “General Average”

• Babylonians 1750 BC – contribute 10,000 Derriks Babylonians 1750 BC – contribute 10,000 Derriks into government treasury & can draw twice this into government treasury & can draw twice this amount if catastrophe,amount if catastrophe,

• Romans 400 AD – Benevolent or Friendly Society Romans 400 AD – Benevolent or Friendly Society (Life Insurance) to pay funeral costs.(Life Insurance) to pay funeral costs.

Modern Insurance History

• Four merchants having a cup of coffee @ Edwin Lloyd’s coffee house, Tower St, London in 1688 – Marine Insurance• Great Fire of London in 1666 – totally uninsured but fresh in memory. Fire warehouse of merchants – General Insurance - 1690• Life Insurance – 1694• Reinsurance - 1846• Income Protection – 1850• Workers Compensation - 1855• Health Insurance – 1929

TODAY

• Actuaries use statistical information such as mortality tables to calculate:

- the likelihood of an event occurring- the possible cost of an event- the total amount needed- the amount each person covered by

the insurance needs to pay – the ‘premium’

PROBLEM

• There are over 35,000 Rotarians in our region undertaking a diverse range of activities

• How does an actuary calculate the premium to cover all Rotarians and volunteers for:

- Property- Liability- Personal injury & Travel- Officers Liability

- Answer – claims rated/burning cost

HOW TO HELP KEEP PREMIUMS LOW

• Reducing the likelihood of an event happening that could lead to a claim

• Achieved by undertaking a risk analysis for every event your club undertakes no matter the size and developing a Risk Management Plan

• Ongoing projects/events require regularly reviews of the risk analysis & updates to the Risk Management Plan,

• Informing participants & have the Risk Management Plan at the activity for reference

WHAT IS RISK ASSESSMENT

• In very simple terms a risk analysis or assessment…

- Identifies a risk that may lead to a claim- Sets out steps to take to reduce that risk- Informs participants of the identified risks

and the steps to be put in place to reduce the risks

It also indicates if the level of risk is acceptable to the club conducting the event

WHY CONDUCT RISK ASSESSMENT

Risk Assessment is not just for Insurance, Risk Assessment is not just for Insurance, consider:consider:

Public Relations - Image and reputation of your Public Relations - Image and reputation of your club and Rotary should something go wrong;club and Rotary should something go wrong;

Membership (existing and new prospects)Membership (existing and new prospects)

Financial (not just claim excess but bad PR may Financial (not just claim excess but bad PR may effect clubs ability to raise funds)effect clubs ability to raise funds)

COVER PROVIDED 2010/11

Who is covered?

All Rotary Districts, Clubs (including Rotaract & Interact), Committees & Sub-Committees, Rotarians & their families, Volunteers and participants taking part in a Rotary event

Note: Why not publish a copy of Insurance Summary on your Club Website to inform members – its not a secret!!!


1. Property (ISR)- owned by the club or when the club is

responsible for the property- Covered anywhere in our region - Cover/Limits:

- Static Risks $50,000- Transit $50,000 except Art $25,000- Theft in open air $25,000- Money $50,000- Personal Effects $5,000 person &

$50,000 total


1. Property continued1. Property continued• Cover/Limits (continued):Cover/Limits (continued):

Art Shows $100,000 item $500,000 totalArt Shows $100,000 item $500,000 total Machinery Breakdown $5,000Machinery Breakdown $5,000 Spoilage of Stock $5,000Spoilage of Stock $5,000 Contract Works $100,000 (was $250,000)Contract Works $100,000 (was $250,000) Property outside Australia $20,000Property outside Australia $20,000

• Excess: $500 Personal Effects & Excess: $500 Personal Effects & Machinery Breakdown (was $1,500); Machinery Breakdown (was $1,500); $1,500 other losses (except Earthquake $1,500 other losses (except Earthquake Subterranean Fire & Volcano)Subterranean Fire & Volcano)


1. Property Exclusions1. Property Exclusions• Locomotives/Watercraft/AircraftLocomotives/Watercraft/Aircraft• Registered VehiclesRegistered Vehicles• Animals/Birds/FishAnimals/Birds/Fish• Standing timber/Crops/PasturesStanding timber/Crops/Pastures• Bridges/Roads/Dams/Tunnels/Docks/WharvesBridges/Roads/Dams/Tunnels/Docks/Wharves• Property undergroundProperty underground• War/Terrorism/Radioactivity/NuclearWar/Terrorism/Radioactivity/Nuclear• Fraud/Dishonest actsFraud/Dishonest acts• Settling/Erosion/SubsidenceSettling/Erosion/Subsidence


Under Insurance means you may only be paid Under Insurance means you may only be paid a proportion of the amount claim/lossa proportion of the amount claim/loss

Clubs with declared assets with replacement values of $50,000 Clubs with declared assets with replacement values of $50,000 or more: Ararat; Boort; Drysdale; East Geelong; and Horsham or more: Ararat; Boort; Drysdale; East Geelong; and Horsham

In last 12 months Replacement Values have increased 20%.In last 12 months Replacement Values have increased 20%.

In my 7 years as DIO there has been approx 60% increase, yet In my 7 years as DIO there has been approx 60% increase, yet clubs have generally not reviewed their sums insured.clubs have generally not reviewed their sums insured.

Google: “BMT Quantity Surveyors”Google: “BMT Quantity Surveyors”

http://www.bmtqs.com.au/ConstructionCostCalculator.aspxhttp://www.bmtqs.com.au/ConstructionCostCalculator.aspx


2. Legal Liability (Public & Products Liability) covers • injury and property damage arising our of official Rotary

activities where negligence involved/alleged• Legal costs and expenses

Limits of liability• $50M any occurrence (& in aggregate for Product Liability)• $2 Million Molestation any claim & in aggregate.• $150,000 Statutory Liability any claim & in aggregate• $100,000 Goods in Care Custody or Control• Includes Vicarious Liability for Markets


2. Public Liability ContinuedExcludes

- Railways (other than model trains for amusement rides),

- Rodeos & all animal rides, - Regular childcare services, - Martial arts or firearm activities, - Building or demolishing over $250K- Participation in sports, trials, races etc- Pharmaceuticals- Malpractice/Treatment Risk (new)


2. Public Liability Continued2. Public Liability Continued

Excesses..Excesses..• $1,000 any occurrence (cost inclusive)$1,000 any occurrence (cost inclusive)• NIL for individual membersNIL for individual members• $25,000 any claim and $125,000 aggregate $25,000 any claim and $125,000 aggregate

any perpetrator for molestationany perpetrator for molestation

Molestation Retroactive date 30 August 2005Molestation Retroactive date 30 August 2005

Complete incident reports straight away & fax or Complete incident reports straight away & fax or email to DIO (better to be proactive). email to DIO (better to be proactive).

COVER PROVIDED 2010/113. Personal Accident and TravelCovers:- Lump Sum on Death and disablement- Weekly Income replacement persons aged 18 to 79

= $1,500 (was $1,000). - Emergency Home Help $150 per week- Non-Medicare Medical $3,000- Kidnap & Ransom $250,000- Loss of Deposit $10,000- Baggage $7,000 ($1,500 any item)- Money & Travel documents $2,000- Electronic Equipment $7,000- Medical & Additional Expenses – unlimited- Political Evacuation $10,000- Personal Liability $20 Million


3. Personal Accident and Travel (continued)3. Personal Accident and Travel (continued)

LimitationsLimitations::• Travel cover journey must be over 50kmTravel cover journey must be over 50km• Journey limited to 90 days including up to 60 Journey limited to 90 days including up to 60

days private traveldays private travel• Benefit amount depends on age:Benefit amount depends on age:

Death & Lump Sum up to & including age 90Death & Lump Sum up to & including age 90 Income up to & including age 79Income up to & including age 79

• Nil excess except 7 days for income Nil excess except 7 days for income replacement and $250 Electronic Equipmentreplacement and $250 Electronic Equipment


3. Personal Accident and Travel (continued)3. Personal Accident and Travel (continued)

ExclusionsExclusions::• war, self-injury, childbirth, HIV/AIDSwar, self-injury, childbirth, HIV/AIDS• Flying in privately owned & operated aircraftFlying in privately owned & operated aircraft• Professional sports of any kindProfessional sports of any kind• Hernia howsoever causedHernia howsoever caused• Person over the age of 95Person over the age of 95

Pre- existing conditions exclusion has been deleted Pre- existing conditions exclusion has been deleted but approval from usual doctor must be but approval from usual doctor must be obtained advising fit to travelobtained advising fit to travel

Wording/PDS/FSG download District 9780 websiteWording/PDS/FSG download District 9780 website


4. Association Liability $2 Million – includes• Directors & Office Bearers Liability, • Association Entity & Reimbursement, • Professional Indemnity, • Fidelity Guarantee (limit $10,000),• Employment Practices, and• Taxation Investigation (limit $10,000).

In simple terms covers District for liability incurred for such things as libel or slander, wrongdoings by office bearers, theft of funds etc


4. Association Liability (continued)4. Association Liability (continued)ExtensionsExtensionsLoss of Documents, External Directorships, Joint Loss of Documents, External Directorships, Joint

Venture, OH&S, Breach of Copyright, Spousal Venture, OH&S, Breach of Copyright, Spousal Liability, Fines & Penalties ($100,000), Liability, Fines & Penalties ($100,000),

ExclusionsExclusionsMedical, Financial or Legal Services, Contractual Medical, Financial or Legal Services, Contractual

Liability, Guarantees & Warranties, PollutionLiability, Guarantees & Warranties, PollutionExcessesExcessesFidelity $5,000, Taxation Investigation $2,000, Fidelity $5,000, Taxation Investigation $2,000, Insured vs Insured $1,000, NIL all other claimsInsured vs Insured $1,000, NIL all other claimsNoteNote: Claims Made policy: Claims Made policy


5. Fidelity/Crime (new cover this year)5. Fidelity/Crime (new cover this year)Covers Loss arising as result of dishonesty by Covers Loss arising as result of dishonesty by

Rotarians, Volunteers, Employees, Students & Rotarians, Volunteers, Employees, Students & Secondees whilst performing services to Rotary. Secondees whilst performing services to Rotary. Limit any loss $50,000 & in aggregate any policy Limit any loss $50,000 & in aggregate any policy year $200,000 year $200,000

ExclusionsExclusions Fines, Penalties or damages except compensatoryFines, Penalties or damages except compensatory Errors or Omissions committed or omitted by youErrors or Omissions committed or omitted by you Loss after you become aware acts committedLoss after you become aware acts committed Cost incurred to establish existence of lossCost incurred to establish existence of loss Loss of confidential informationLoss of confidential information Indirect or consequential lossIndirect or consequential loss

ExcessesExcesses: $5,000 each & every claim: $5,000 each & every claim


6. Caravan/Trailer Insurance (optional – so after 6. Caravan/Trailer Insurance (optional – so after many years of advising clubs to insure own many years of advising clubs to insure own trailers, this cover was dropped 2010/11)trailers, this cover was dropped 2010/11)

Covers trailers & caravans as declaredCovers trailers & caravans as declared• Cover: Trailers $5,000/Caravan $10,000 Cover: Trailers $5,000/Caravan $10,000 • Third Party Property Damage $10 Million Third Party Property Damage $10 Million • Supplementary Bodily Injury $5 MillionSupplementary Bodily Injury $5 Million

Excesses:Excesses: $500 except whilst hired out $1,000 $500 except whilst hired out $1,000

What you & your club members MUST do

1. Risk Management – every activity2. Advise DIO as soon as possible of all

potential claims3.Annually review value of club assets 4. Respond to DIO’s requests for info5. Read the Insurance Summary on the District

9780 Website, and only then contact the DIO6. If you have any questions, put them to the DIO

in writing (prefer email)

What the DIO does

Answer questions about the policy and Answer questions about the policy and refers matter if necessary to Rotary’s refers matter if necessary to Rotary’s BrokerBroker

Supply of Certificates of Currency & Claim Supply of Certificates of Currency & Claim forms (most of which are also on the forms (most of which are also on the District Website)District Website)

Forwards claim to Rotary’s BrokerForwards claim to Rotary’s Broker Renewal forms (based on number of Renewal forms (based on number of

Rotarians & value of assets of clubs)Rotarians & value of assets of clubs)

What the DIO does not doWhat the DIO does not do

1.1. Provide financial adviceProvide financial advice2.2. Represent the Broker or the Represent the Broker or the

Insurers (but the District)Insurers (but the District)3.3. Want to hear about every activity Want to hear about every activity

your club does – only where you your club does – only where you have read insurance summary and have read insurance summary and are uncertain or have questionsare uncertain or have questions

4.4. Check or complete your Risk Check or complete your Risk ManagementManagement

CostCost per Rotarian 2010/11per Rotarian 2010/11

Industrial Special Risks $2.26 Industrial Special Risks $2.26 (09/10 $2.26)(09/10 $2.26)

Public Liability Public Liability $8.37 $8.37 (09/10 $8.68)(09/10 $8.68)

Personal Accident/Travel $4.73 Personal Accident/Travel $4.73 (09/10 $4.73)(09/10 $4.73)

Association Liability Association Liability $0.96 $0.96 (09/10 $0.96)(09/10 $0.96)

Fidelity/Crime Fidelity/Crime $0.21 $0.21 (09/10 Nil)(09/10 Nil)

Caravan (per district) – Not selected (09/10 $0.31)Caravan (per district) – Not selected (09/10 $0.31)

Total Total $16.53 (09/10 $16.94)$16.53 (09/10 $16.94)

CONTACT DETAILS

Don Shields

32-34 Ormond Road, East Geelong 3219P O Box 96, Geelong 3220

Work (03) 5229 0061Mobile 0419 390 303

[email protected]

don shields district insurance officer 9780 may 2011

Documents

event slide

health insurance

insurance needs

level of risk

funds slide

premium slide

reference slide

risk analysis updates