A lot of you have expressed interest in the new common room insurance recently made available exclusively to residents of housing providers insured under SHSC’s group insurance program. I thought I’d take this opportunity to address some of the most frequently asked questions about the new program.
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Do my residents need this insurance for regular meetings or casual gatherings (i.e.: teas, card games)?
No. This insurance is intended for one-time events that may or may not include alcohol. Your residents may want to host a family dinner or other celebration like a wedding shower and ask for the use of your common room for such an event. Whether you charge a rental fee is up to you, but you should consider adding an insurance requirement to your usage agreement that requires event organizers and/or hosts to purchase event insurance coverage for it.
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We rent our common room out several times a year. Is this insurance available on a yearly basis or only for one event at a time?
Because the intent of the common room insurance is to cover one-time events, a new policy must be purchased for each event separately.
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Sometimes we rent our common room to outside agencies or organizations. Can anyone buy SHSC’s common room insurance or is it available only to my tenants?
Anyone renting your common room for an event may purchase the insurance, but outside agencies or organizations will likely already have their own insurance coverage in place and won’t need to buy additional coverage. Simply ask them to have your corporation added to their policy as an Additional Insured for the event and ask for proof of the insurance.
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What is the benefit to my corporation in requiring our residents to purchase their own insurance? Can’t we rely on the corporation’s insurance policy?
Yes, you can rely on your corporation’s insurance policy to cover you for these events, but by doing so, any claims that arise from an event in your common room put on by one of your tenants or outside agency will be reported under your policy under your corporation’s name. This means that your insurance company will have to pay costly investigation and legal expenses to defend you against allegations made surrounding the event, even if your only involvement was to supply space for the event to occur. Your claims history and loss record will reflect these types of claims as well and may affect your insurance premiums. In addition, if the claim is settled for money damages, you will have to contribute your deductible to the settlement.
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But what if my corporation is named in a lawsuit anyway along with the event organizers? Won’t my insurance policy still have to respond to it?
No. If your residents purchase SHSC’s common room insurance for their events, your corporation will automatically be added to the policy as an Additional Insured so that even if you are named, you are protected. The common room insurance policy will be called upon to respond, not your corporation’s policy. When a policy is purchased, a copy of the Certificate of Insurance will be sent to your office for your records.
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Our common room rental contract and/or user agreement does not currently have any insurance requirements in it. Should we add a requirement in and where can we get help with the wording?
If you are going to make insurance a requirement of the rental contract or user agreement, the wording for it should be added to your current contract or agreement. Any wording should be clear and unambiguous. Your best option for assistance with wording is to obtain legal advice.
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How much does the insurance cost and how do our residents apply for it?
Premiums will vary based on the number of expected attendees and whether alcohol will be served. Rates start as low as 27$ for coverage of $2,000,000. Applications and additional information may be obtained from our website or by downloading the application form.
Further information on common room insurance can be obtained in our latest issue of Risky Business and/or from my 2010 five-part blog series:
Over the last few weeks, we’ve talked about the different considerations when renting out your common and/or party rooms. What have we learned?
The first thing to consider is what type of event will be hosted in these rooms and whether alcohol will be served. If you’ve determined that alcohol will be served, you should ensure that the event organisers obtain the requisite Special Occasion Permit (SOP) from the Alcohol and Gaming Commission of Ontario.
The next thing to consider is whether to rely on your housing corporation’s own insurance and whether to enter into a rental contract that clearly outlines each party’s rights and obligations regarding the rental of your common and/or party room. While the existence of a contract will not likely absolve you of all liability, it will certainly aid in any defence your insurance company lays out for you.
Risky Business - Spring 2010 Edition
Another option is to require event organisers to purchase their own insurance coverage for their events, commonly known as Special Event Insurance or Social Host Liability Insurance. For additional information on this type of insurance, visit Elliot Special Risks.
Lastly, it is important to remember that your housing corporation’s insurance policy does not provide coverage to any property or contents belonging to your tenants, guests, event organisers or event attendees. Event organisers should be made aware of this and it should be spelled out in your rental contract or agreement. Property belonging to your housing corporation will be covered as long as the property was lost or damaged due to a covered risk.
In our ever-increasingly litigious society, it is important to do everything possible to reduce our exposure to common hazards associated with the shared spaces in our residential buildings. For more risk management tips, check out our newest edition of Risky Business.
When renting out your common and/or party rooms, one last thing to remember is that any property belonging to your tenants, the event attendees or organizers is not covered by your corporation’s insurance policy. It is important to make this clear when you are renting these rooms and in any rental contract or agreement. If; however, anything happens at or during the event that results in loss or damage to property belonging to your housing corporation, your policy will provide coverage as long as the cause of the loss or damage is an “Insured Peril” (aka: a covered risk).
We’ve talked about several different aspects of the risks and issues for you to think about regarding common and/or party room rentals recently and our final installment in our series will recap them all. In the meantime, refer to parts 1, 2 and 3 for a refresher or for anything you may have missed.
Party Room/Common Room Rentals Series
Last time, we talked about the issues and risks of relying on your corporation’s own insurance coverage when renting out your common/party rooms. This week we’ll tackle another consideration when renting out these rooms: requiring the event organizers to purchase their own insurance.
Special Event insurance, also known as Social Host Liability insurance, provides coverage for a specific event and its organizers, and often includes general liability and server liquor liability. If something should happen at or during the event, the injured party can make a claim against the event’s insurance policy, and not your corporation’s policy.
It is important to note that special event liability insurance does not cover the personal property of the event’s organizers or its attendees, nor does your corporation’s insurance provide this coverage. This is what we’ll talk about in part 4 of our series on common rooms.
For more information about special event insurance, visit Elliot Special Risks
In my last blog entry, I talked about the importance of ensuring that event organizers, who are using building common rooms, obtain the relevant Special Occasion Permit from the Alcohol and Gaming Commission of Ontario, if they are serving alcohol. Today, we’ll look at the liability issues that your corporation could face by allowing events that serve alcohol to take place on your property.
Some questions you need to consider: what happens if a minor consumes alcohol at the event and becomes ill? What if someone leaves the event after consuming alcohol hosted on your premises and gets into a car accident that results in injury or death? The injured party or parties could sue your corporation – even if your only connection to the event is the location.
Protecting yourself with a rental contract
So how do you protect yourself? Make sure you have a plainly written rental contract with unambiguous language that clearly sets out each party’s rights and obligations concerning the rental room. Your contract should include a clause that clearly indicates your corporation is not liable for injuries or damages incurred during the event. A carefully executed contract and a Special Occasion Permit will assist should you find it necessary to defend the corporation against a lawsuit.
Unfortunately, these documents likely won’t be enough to fully absolve you of liability. A better option is to require that the event organizers purchase their own insurance coverage. This is called Special Event insurance or Social Host Liability insurance and that’s what we’ll talk about next time.
Many of you have common rooms and/or party rooms for your tenants’ social events or community meetings. But did you know that there are insurance considerations associated with the use of these rooms? Here are a few things you should know.
There are two ways to insure these events. The first is to rely on your own insurance. The second is to require the event’s organizers to provide their own insurance coverage.
Should you choose the former, there are two important considerations from an insurance perspective: the availability of alcohol at these events and who is responsible for property belonging to the events’ organizers and attendees.
Today, I will talk about the first of those considerations, which is whether or not alcohol will be served at or during the event. If alcohol is being served, the organizers will be required to obtain a Special Occasion Permit (SOP). There are three classes of SOPs; a Sale SOP, a No Sale SOP and an Auctions SOP. Details of these permits and application forms may be found on the Alcohol and Gaming Commission of Ontario’s website.
To protect yourself from liability, you should ensure the event organizers have applied and obtained the relevant permit and should take a copy for your records.
Next time, I will talk about liability and insurance concerns surrounding alcohol-included events.
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