The Back Office: Insurance Primer

AS A GUIDE or outfitter, you may ask yourself, “Do I need general liability insurance?” Consider the following true story. A guide had put two wild-hog hunters in two different stationary treestands that were a few hundred yards apart and stood overlooking a bait station each. The rules of the hunt had been explicitly explained to the hunters, including directions to not leave the stand until the guide arrived to pick them up.

On this particular day, the hunt was nearing completion as darkness began to set in. One of the hunters heard something move in the woods. He looked through the dim light toward the noise and saw what he had been looking for all evening. The hunter shot and saw the animal fall. When he walked up to the game, he realized the worst: he had just accidentally shot his best friend. The injured hunter, close to death, was airlifted and miraculously survived but suffered permanent disability.

Fortunately, the outfitter had proper insurance, which covered more than $700,000 in damages and medical expenses. So.... Yes. You do need general liability insurance.

General Insurance Facts
In fact, anyone who owns a business—especially a business that offers outdoor recreation, such as hunting—should purchase Commercial General Liability Insurance (GL) to help protect their assets and interests. Further, GL claims do not have to be so dramatic as a hunter accidentally shooting his buddy. Claims are common, can come up during normal business operations, and can get very expensive quickly.

There are multiple types of GL claims that can arise. Bodily injuries and property damage can include customer slip-and-fall accidents—for example, a client falling from a horse on a backcountry hunt or a guest becoming injured on a fly-fishing excursion.

Other less obvious claims could include advertising injury, which is defamation caused by your business operation; copyright Infringement, such as using someone else’s work in your business advertisements without their approval; and reputational harm, which could be something so simple as you or an employee may have said about another business that may have negatively impacted their company.

For each of these instances, GL insurance would cover the costs of property damage claims, medical expenses if someone is injured as the result of your business operations, administrative costs for covered claims, and court costs such as judgments and settlements for covered claims. But GL won’t cover everything, such as commercial automobile accidents, injuries to employees that occur on the job, and damages you or your employees inflict on your own business property.

For auto claims, you’d need a commercial auto policy. Make sure limits of liability purchased are at a minimum $300,000 combined single limit, which pays bodily injury and damage claims out of one sum, as opposed to split limit, which has separate limits for bodily injury claims. Your agent will be able to explain in more detail the need to purchase auto liability limits well above your state’s minimum requirements. Also, make sure to purchase equal limits of Hired and Nonowned Liability. Commercial automobile insurance provides coverage for picking up and transporting clients to and from the airport, hunting areas, etc.

For employees who suffer injuries or illnesses from their work, you’ll need Workers Compensation Insurance, which helps cover their medical bills, ongoingcare expenses, lost income, etc. Most states require it if you have even just one employee. Depending on your state, you can get this insurance from a private insurance company, a state-run agency, or a monopolistic state fund.

For damages to your business property, you will need Commercial Property Insurance which helps protect your owned or rented building and business equipment. The primary danger of not having GL is being swamped. Judgments, settlements, legal-defense fees, and court costs can be extremely expensive. If a claim winds up in court or even if it’s dropped, costs can easily exceed $100,000–just remember the example that began this article.

You might also want to consider Commercial Umbrella Insurance. In some cases, claims can exceed the insured’s primary GL. The umbrella simply provides the business owner with increased liability insurance protection.

The Expertise You Need
Many insurance companies offer GL, but not all of them have expertise in the outdoor-recreation arena, and a guiding business needs just that. So look for a company that specializes in providing insurance to guides and outfitters, hunt clubs and leases, angling and hunting lodges, archery and gun clubs, landowners, and even taxidermists.

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Brit Barker is president and CEO of Costal Plains Outdoors, which specializes in insuring lodges and businesses owned by outfitters, guides, and others in the outdoor-recreation industry. For more, please visit cpoutdoorinsurance.com or call 800-664-0222, ext 1.

From the Spring 2022 issue of Guidefitter Journal.