How affinity insurance provided affordable cover for a national sports body and its members

For what is widely regarded as a low-risk sport, golf courses face numerous hazards. A national golf organization in Australia was faced with the task of insuring risks for 400,000-plus members, non-members, and board members across 2,000 clubs. The risks were diverse, including flood, bushfire, personal injury, and third-party damage — to name a few. However, due to a high level of claims, some of these risks were extremely unattractive to insurers, making it expensive for individual clubs to get appropriate coverage.

Marsh created a new affinity insurance solution covering the courses in the organization’s portfolio by aggregating the risk and pooling the premium in order to place the program. Ultimately, the program enables individual golf courses the opportunity to get the right level of coverage at a competitive cost.

The program also provides visibility on losses and fast tracks claims payments, particularly those relating to high-frequency, low-cost events.

Risks faced by golf courses and golfers

In Australia, many golf courses are located on highly-exposed land that is susceptible to flood, bushfire, and storm damage.

Golf course greens, fairways, tees, plants, shrubs, machinery, and buildings must be maintained to a high standard and can be easily damaged by natural events or even rogue golfers.

There is risk of injury from stray golf balls to players, spectators, and people walking on public footpaths that traverse golf courses. And, there is the ever-present risk of a golf ball damaging a car in the club parking lot.

Why use an affinity insurance program?

• An affordable insurance program. By aggregating all of the member facilities’ total risk and pooling premiums, Marsh was able to provide competitive cover options for the organization’s members.
• Coverage for high-risk or uninsurable risks. Under the new program, the clubs were able to insure certain items such as the greens or golf carts that had extremely limited coverage options.
• A fast-tracked claims process. Some of the risks golf courses have to grapple with are high frequency, such as a golf ball hitting a car in the parking lot or damage to a vehicle from a fallen tree branch. Under the program, a pre-agreed amount for these kinds of losses is paid out to club members straight away.
• Enhanced liability coverage for club members and non-members In Australia, golf courses cater to annual fee-paying members as well as non-members. Marsh leveraged 400,000-plus regular golf club members to enable insurance of non-members.
• Helping clubs mitigate against future loss. Clubs that make a high number of insurance claims are identified under the program. Marsh engages with them to mitigate their risk.  This includes providing expert advice to restructure a hole, put up nets, and in the case of public footpaths crossing greens, add signposting to warn people they are entering a golf course.
• Insurance value educational program. Articulating the benefit of insurance to the clubs and their members was not always easy. Marsh rolled out a communication plan for the organization to educate club members, management, and boards on the value of the new insurance program.

* Marsh’s Affinity practice supports clients globally across sports, sponsored programs, sharing economy and mobility, automotive, and consumer electronics.