Compare the Market for Golf Insurance
Despite some of the price competition facing the insurance industry, many agents and brokers specializing in golf insurance believe the programs they offer will continue to be profitable books of business and will weather the recession and the slow amount of traffic at the golf courses and country clubs recently.
Many insurance specialists believe the game of golf is feeling the effects of the real estate market and overall recession. With many families or individuals having less disposable income, fewer rounds of golf are being played. However, golf is an addictive sport and leisure activity that has been around a long time and is not going to disappear any time soon. Prior to the recession, there was a huge surge in interest in golf, especially in younger players inspired by the likes of Tiger Woods and other young golf super stars.
Premiums are very price competitive right now, not only because of the soft commercial insurance market, but also because of the number of new insurance companies that have ventured into the market for golf courses and country clubs during the past decade. As the commercial insurance market has softened, premiums have fallen. With the entry and relatively high number of new companies entering into the golf insurance market in the past several years we are seeing a big competition in insurance markets for golf course policies.
In the past several years, carriers such as Fairway Underwriters, Philadelphia Insurance Cos., Harleysville Insurance Co. and Safeco have increased their efforts to gain their share of the golf insurance market.
Meanwhile, long standing players in this insurance market have increased their policy offerings and increased services such as loss and risk control to stay competitive. The market for insuring a golf course or country club is attractive because of the success some of the longstanding companies have had such as AIG, Chartis, Chubb and Travelers in the golf insurance market.
From an insurance standpoint many companies view golf courses or country clubs as a good risk. Statistics show that golf courses tend to not file claims for every little item because they have large maintenance and ground crews. Most of the time if any damage happens on the course the ground or maintenance crew for the golf course is able to fix the problem. Country clubs tend to only submit a very large claim or damage to the course and most insurance professionals note that those claims occur very few and far between.
Severity, rather than frequency, is the bigger concern with claims when it comes to golf courses and country clubs. Consequently, carriers that focus on serving the golf industry tend to emphasize their value added loss and risk programs, particularly during recessions like this one.
Golf Courses have unique risks and therefore companies must design custom tailored policies for country clubs that can cover their unique claims. For most commercial buildings, fire, wind and water are the biggest concerns for claims.
Golf courses can possess large electrical storage units for golf carts, club houses, restaurants, pools, and irrigation systems and can be often at risk for random lightning strikes. However, even with all those added risks and potentially more expensive claim submissions most insurance agents and companies feel there is a solid stream of income to be made in the golf insurance market.
Offering a line of golf course insurance can diversify an insurance company and help with the overall bottom line. The key factor when jumping into any insurance market is conducting the proper research and understanding the risks and benefits that are found in the market prior to adopting any new policy lines to the company.