NOT ALL SPORT UNPROFITABLE

Not all of the specialty sports lines are unprofitable it appears. General liability coverage has been good business for Canadian managing general underwriters K&K Insurance, who write $50 to $70 million in premiums annually safeguarding teams against litigation surrounding spectator injuries. The company handles some contingency products, their biggest client in that sector being NASCAR racing, but K&K envisions soon entering the sports contract market because of the demands of their insured consumers.

Unlike sports contract insurance, which participants say runs at an underwriting profit, K&K’s general liability runs at an operating ratio estimated in the high eighties by underwriting director Tony Iatesta. He attributes the underwriting profit in this business segment to strong risk management and an actuarial science which — unlike in the contract realm — has enough data in order to accurately rate the risk.

Also, builders of the new sports stadiums popping up all over North America have been safety conscious, Sandee Howle, K&K senior vice president maintains. “Using Toronto as an example, the Air Canada Centre is better lit with wider steps than Maple Leaf Gardens. Less accidents are bound to happen at the new stadiums and arenas and our loss experiences in them show it.”