Why do Yoga Instructors need their own insurance coverage? I know it may sound like a simple question with a simple answer, but you would be surprised at how many yoga and Pilates instructors and personal trainers choose not to carry their own liability insurance protection. There are three main reasons why these individuals choose to go “bare”. Many part time instructors go without insurance protection because they feel that by teaching only a few classes a week, the cost to be insured doesn’t make sense. Yoga instructors who are working as “independent contractors” are also led to believe that they are covered under the liability insurance of the facilities they instruct at. Other yoga instructors who are “employees” of a yoga studio or fitness center are comfortable knowing that they are covered by the facility’s insurance policy. With any of these scenarios, the instructor or trainer MAY have liability protection; MOST do not. In the case of the part time yoga instructor, the decision to go without insurance coverage is purely financial. Why would a person who only makes $25 a class 3 days per week need insurance? The answer is simple…we live in the most litigious society in history. If just one person twists their ankle in class or pulls a muscle during a stretching maneuver, don’t think for a minute that you, as the instructor, won’t be named when the lawsuit is filed. The facility and the instructor will both be named in the complaint and will all have to provide their own separate defense. In the case where the instructor is not an employee of the club, the need for having their own policy is crucial. Regardless of fault, that instructor will be forced to hire an attorney to prepare a defense. If the yoga instructor is an independent contractor, having your own insurance policy is as important as keeping your certification status current; if not more so. As a certified yoga instructor or trainer, you are proclaiming to the world that you have considerable expertise in the areas of physical fitness, weight loss, and nutrition/supplement advice and food management. In other words, you are holding yourself out as a professional in these areas and you have the credentials to prove it. Obtaining this level of education and experience is both a blessing and a curse. The blessing; as a certified or credentialed professional, you can charge a considerable fee for your services. The curse comes in to play if your client is injured during their session or becomes ill from a food supplement or nutrition advice you may have provided, your credentials have set your level of care to a higher degree. In other words, no one should EVER be injured while under the guidance of a “professional” instructor. Even if the client is injured through no fault of the instructor (which is generally the case), that instructor is now at risk of having to defend themselves should the client want to seek damages. Defense costs alone can reach tens of thousands of dollars. In the last scenario where the instructors are “employees” of a yoga studio or fitness facility, there usually is coverage in place to extend liability insurance protection to all employees. Unfortunately, these instructors have no way of knowing whether or not the owner of the facility has renewed their policy or may have purchased a standard liability insurance policy that does not contain a professional liability endorsement. In other words, these trainers and instructors are at the mercy of a third party (their boss) having the proper insurance in place to protect them. As I mentioned earlier, when someone files a lawsuit, ALL parties are going to be named. If that facility owner does not have the correct insurance coverage or worse yet, has no policy in force, the trainer will be placed in a position to hire their own attorney and may have to pay the claim out of their own pocket. The bottom line here is that EVERY yoga instructor, certified personal trainer, group exercise instructor, martial arts instructor, nutrition counselor, and dance teacher should have their OWN liability insurance coverage. At a cost of about $3.15 a week for $1,000,000 of protection, it is silly not to have your own insurance policy. For more information about liability insurance coverage for yoga instructors you can go to www.yogafitinsurance.com. Also, for a copy of our latest recommended waiver form designed for yoga instructors, please contact me at ken@clubinsurance.com.

Although the title of this article addresses a “tongue in cheek” look at our members and society in general, we all know too well that there is great deal of truth in this statement. Unlike previous articles I have written in the past in which I have attacked the hallowed and revered Trail Lawyers, I would like to turn the tables a bit and point out the problems with the other side; the liability insurance companies.

 

I know that it is not nice to criticize the very industry that has allowed me to enjoy a comfortable lifestyle, but the truth must be told.   Most insurance companies don’t have a clue about the concept of “customer service”.   After 20 years in the insurance business, I have yet to find an insurance company claims department that would earn the right to be called responsive or professional.

 

As a result of their poor customer service and performance, insurance companies have actually increased the success and attorney compensation levels of the Trial Lawyers Association. Granted, some insurance companies are worse than others, but in general, every single one of them could improve their communication skills and most of them could use a “backbone” transplant. Personal Injury Attorney’s will never admit this, but they actually share information about which insurance companies are pushovers and which ones will put up a fight.   They will even discuss the various insurance company’s “threshold of pain”, or settlement trends. In other words, even if the claim is totally groundless and without merit, a personal injury attorney will have a good idea of how much to ask for to “go away”.   It makes me sick. Now for my disclaimer. In fairness to our new liability insurance company, National Casualty, I must give them the benefit of the doubt. We have reached a conceptual understanding of proper claims management technique and I feel confident that they will rise to the occasion.

 

The following are, what I believe to be, the key issues involving liability claims from a defense position.

 

• Prompt notification by the club owner. When a member is hurt at the club, it is often a minor injury.   (Member falls off treadmill, member slips in the shower, member drops a weight on their own foot. etc.)   Once an incident occurs, it is reported to the acting club manager, who then reports the injury to the agent. The insurance agent then completes certain reports to forward to the claims department at the insurance company.   In a perfect world, this should all happen on the same day the incident occurred. However, if the club decides that the injury was insignificant, no report may ever be filed.   This, of course, could be a major problem. If the injured member decides six months from now that the injury he or she sustained is still bothering them, or if a friend or relative suggests that they contact an attorney, we are now saddled with the task of re-creating the event. The longer that time passes, the less likely we will be able to develop an accurate accounting of what exactly took place.   Insurance companies are then forced to deal with a claim that boils down to a “our word against theirs” scenario.   The insurance company will lose. It is important to document EVERY incident at the club the DAY the accident occurred.   Be sure to obtain any witness reports as well.   Keep in mind, that it is not necessary for the injured person to file a report, in fact we advise against it. Remember that we are documenting these events as WE see them.
• Prompt response from the claims department. It is unfortunate that many of the problems involving a claim occur at this level. I can’t tell you how many times a simple $200 medical payment has escalated into a $10,000 litigation process. If insurance company claims adjusters would simply pick up the phone and contact the injured member within 48 hours, they would be able to establish a professional relationship with the claimant early thereby reducing the probability that the claimant will contact an attorney.   Nearly all insurance policies written in our industry contain a $5,000 premises medical payments coverage regardless of fault. Therefore, it only makes sense to move quickly to get these minor medical bills paid. Early communication is essential.   If a claim is more serious or if the injured person is seeking compensation from the club, it is still necessary for contact to be made immediately.   Claims adjusters who sit on their files have become a real problem.
• Take a stand and stick to it. Nothing upsets me more than an insurance company who is not willing to stand up for the rights of the club owner and the integrity of the insurance policy.   If a member injures themselves as a result of their own carelessness and they are seeking damages other than what is covered under “premises medical” payments, than the insurance company needs to inform the plaintiff attorney that we are sorry their client was injured, but its not our fault. PERIOD.
• Too eager to “settle”. How many times have you heard from your insurance company that it is cheaper to just settle a claim than to engage in a long legal battle. I, personally, would rather fight regardless of the litigation costs.   However, I can also understand the insurance company’s reluctance to go to court.   After all, the fate of the case is ultimately in the hands of a jury comprised of individuals who already have pre-conceived ideas of the health club industry and chances are that 90% of the jurors have never set foot in a health club. I think you can understand the reluctance on the part of the insurance company to go to court. Not to mention, juries have been known to award huge settlements for the most ridiculous claims.   Does anyone remember the McDonald’s coffee spill incident?   If an insurance company decides it is better to settle than to litigate, fine. Negotiate a settlement quickly or go to court.   Too often insurance companies will allow a file to remain “open” for years.   They forget the basic rule of claims management and business in general; time is money. The longer a claim remains open, the more it will cost. Reputation is everything to an insurance company.   They should be responsive and fair with legitimate claims and tough as hell on the rest.

 

Is it Member vs. Club Owner or Personal Injury Attorney vs. The Insurance Company? It is an important question to ponder.   A very good client of mine, Jay D’Amato who owns two clubs in Missouri, told me a story about a member who was injured through no fault of the club.   The member was insistent upon filing a claim against Jay’s insurance company. Jay told the member that if he filed a claim, it would not be against the insurance company, the claim would be against him personally. Technically Jay is totally correct but more importantly, the member never really stopped to consider that he would be directly accusing Jay of being negligent for his injury. Jay talked to the member at great length about his grievance and instead worked out an arrangement extending his membership for three months at no charge. The member is now a big supporter of the club and has brought in family members and friends to join. Imagine that; two individuals working out a problem without attorneys and claims adjusters.   How many club owners would take this approach?   Can you see how our society has been trained to think that its O.K. to sue the insurance company and not the club owner?   It amazes me how many claims we have pending where the plaintiff is still an active member at the same gym that they are in the process of suing.

 

In closing, there are several factors that decide the ultimate outcome of any lawsuit; but perhaps the biggest factor of all is how we, as citizens, view what is proper and fair in our society. Accountability for our own actions, reasonable compensation awards, and punitive damages are on-going topics of disagreement. Keep in mind that our courts are nothing more than a reflection of ourselves. Thanks to the dramatic escalation of personal injury cases brought about by an eroding moral foundation that transfers the scope of accountability from the individual to someone else and an insurance industry that lacks in basic customer service skills, our “system” of litigation in this country has become out of control. We all know who ultimately pays for the cost of this system. How much did you pay last year for your auto, homeowners, workers compensation and gym insurance?

 

So, maybe I’ll go out and slip on someone’s sidewalk, or chip a tooth on a water glass in a fancy restaurant, or go work out at a gym and strain a back muscle.   After all, I could use the money.